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<SEC-DOCUMENT>0000950136-07-005646.txt : 20070814
<SEC-HEADER>0000950136-07-005646.hdr.sgml : 20070814
<ACCEPTANCE-DATETIME>20070814120420
ACCESSION NUMBER:		0000950136-07-005646
CONFORMED SUBMISSION TYPE:	10-Q
PUBLIC DOCUMENT COUNT:		9
CONFORMED PERIOD OF REPORT:	20070630
FILED AS OF DATE:		20070814
DATE AS OF CHANGE:		20070814

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:		10-Q
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-11398
		FILM NUMBER:		071052659

	BUSINESS ADDRESS:	
		STREET 1:		200A EXECUTIVE DR
		CITY:			EDGEWOOD
		STATE:			NY
		ZIP:			11717
		BUSINESS PHONE:		5165865200
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>file1.htm
<DESCRIPTION>FORM 10-Q
<TEXT>
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<a name="page"></a><font style="font-family:serif;font-weight:normal;color:#000000;font-size:8pt;  text-align: left; font-style: normal; line-height: 10pt; background-color: #ffffff"><a href="#toc">Table of Contents</a></font>
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<font style="opacity:100; position:relative; ">SECURITIES AND EXCHANGE COMMISSION</font>
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<p style="font-family:serif;font-weight:bold;color:#000000;font-size:12pt;  width: 456pt; text-align: center; font-style: normal; line-height: 14pt; padding-top: 6pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: pt; padding-bottom: 0pt; background-color: #ffffff;">
<font style="opacity:100; position:relative; ">Washington, D.C. 20549</font>
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<font style="opacity:100; position:relative; ">FORM 10-Q</font>
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<p style="font-family:serif;font-weight:bold;color:#000000;font-size:14pt;  width: 456pt; text-align: center; font-style: normal; line-height: 16pt; padding-top: 24pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: pt; padding-bottom: 6pt; background-color: #ffffff;">
<font style="opacity:100; position:relative; ">QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)</font>
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<font style="opacity:100; position:relative; ">OF THE SECURITIES EXCHANGE ACT OF 1934</font>
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<table style="border-top:none; border-bottom:none;border-left:none; border-right:none;margin-left:0px; " cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">For the quarterly period</font>
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<font style="opacity:100; position:relative; "> ended June&nbsp;30,&nbsp;2007</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="center" valign="t" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Commission File Number 1-11398</font></font></td>
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<font style="opacity:100; position:relative; ">CPI AEROSTRUCTURES, INC.</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: 6pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: pt; padding-bottom: 6pt; background-color: #ffffff;">
<font style="opacity:100; position:relative; font-weight: normal;font-style:normal;">(Exact name of registrant as specified in its charter)</font>
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<td><img src="spacer.gif" height="1" width="293"></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">New York</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">11-2520310</font></font></td>
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<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">(State or other jurisdiction</font>
<br>
<font style="opacity:100; position:relative; "> of incorporation or organization)</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="center" valign="top" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">(IRS Employer Identification Number)</font></font></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-left: 10pt; text-indent: -10pt; padding-top: 32pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">60 Heartland Blvd., Edgewood, NY</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-left: 0pt; text-indent: 0pt; padding-top: 32pt; background-color: #ffffff;	" align="center" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">11717</font></font></td>
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<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">(Address of principal executive offices)</font></font></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="center" valign="top" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">(zip code)</font></font></td>
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<font style="opacity:100; position:relative; font-weight: normal;font-style:normal;">(631) 586-5200</font>
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<font style="opacity:100; position:relative; font-weight: normal;font-style:normal;">(Registrant&rsquo;s telephone number including area code)</font>
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<font style="opacity:100; position:relative; ">Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.&nbsp;&nbsp;&nbsp;&nbsp;Yes&nbsp;&nbsp;&nbsp;</font><img src="xbox.gif" alt="[X]" width="10" height="10"><font style="opacity:100; position:relative; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No&nbsp;&nbsp;&nbsp;</font><img src="ebox.gif" alt="[ ]" width="10" height="10"></p>
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<font style="opacity:100; position:relative; ">Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of &lsquo;&lsquo;accelerated filer&rsquo;&rsquo; and &lsquo;&lsquo;large accelerated filer&rsquo;&rsquo; in Rule 12b-2 of the Exchange Act (Check one):</font>
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<font style="opacity:100; position:relative; ">Large accelerated filer&nbsp;&nbsp;&nbsp;&nbsp;</font><img src="ebox.gif" alt="[ ]" width="10" height="10"><font style="opacity:100; position:relative; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accelerated filer&nbsp;&nbsp;&nbsp;&nbsp;</font><img src="ebox.gif" alt="[ ]" width="10" height="10"><font style="opacity:100; position:relative; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-accelerated filer&nbsp;&nbsp;&nbsp;&nbsp;</font><img src="xbox.gif" alt="[X]" width="10" height="10"><font style="opacity:100; position:relative; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font>
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<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">
<font style="opacity:100; position:relative; ">Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).&nbsp;&nbsp;&nbsp;&nbsp;Yes&nbsp;&nbsp;&nbsp;</font><img src="ebox.gif" alt="[ ]" width="10" height="10"><font style="opacity:100; position:relative; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No&nbsp;&nbsp;&nbsp;</font><img src="xbox.gif" alt="[X]" 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">
<font style="opacity:100; position:relative; ">As of August&nbsp;10,&nbsp;2007, the number of shares of common stock, par value $.001 per share, outstanding was 5,750,273.</font>
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<font style="opacity:100; position:relative; ">INDEX</font>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">Part I:&nbsp;&nbsp;&nbsp;&nbsp;Financial Information:</font></font></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
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<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Item 1 &ndash; Condensed Financial Statements:</font></font></td>
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<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><a href="#page3"><font style="opacity:100; position:relative; ">Condensed Balance Sheets as of June&nbsp;30,&nbsp;2007 (Unaudited) and December&nbsp;31,&nbsp;2006</font></a></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><a href="#page3"><font style="opacity:100; position:relative; ">3</font></a></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><a href="#page4"><font style="opacity:100; position:relative; ">Condensed Statements of Operations for the Three Months and Six Months ended June&nbsp;30,&nbsp;2007 (Unaudited) and 2006 (Unaudited)</font></a></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><a href="#page4"><font style="opacity:100; position:relative; ">4</font></a></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><a href="#page5"><font style="opacity:100; position:relative; ">Condensed Statements of Cash Flows for the Six Months ended June&nbsp;30,&nbsp;2007 (Unaudited) and 2006 (Unaudited)</font></a></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><a href="#page5"><font style="opacity:100; position:relative; ">5</font></a></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><a href="#page6"><font style="opacity:100; position:relative; ">Notes to Condensed Financial Statements (Unaudited)</font></a></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><a href="#page6"><font style="opacity:100; position:relative; ">6</font></a></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><a href="#page9"><font style="opacity:100; position:relative; ">Item 2 &ndash; Management&rsquo;s Discussion and Analysis of Financial Condition and Results of Operations</font></a></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><a href="#page9"><font style="opacity:100; position:relative; ">9</font></a></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><a href="#page14"><font style="opacity:100; position:relative; ">Item 3 &ndash; Quantitative and Qualitative Disclosures About Market Risk</font></a></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><a href="#page14"><font style="opacity:100; position:relative; ">14</font></a></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
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<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><a href="#page14"><font style="opacity:100; position:relative; ">Item 4 &ndash; Controls and Procedures</font></a></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><a href="#page14"><font style="opacity:100; position:relative; ">14</font></a></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">Part II: Other Information</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
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<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><a href="#page15"><font style="opacity:100; position:relative; ">Item 1A &ndash; Risk Factors</font></a></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><a href="#page15"><font style="opacity:100; position:relative; ">15</font></a></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><a href="#page15"><font style="opacity:100; position:relative; ">Item 4 &ndash; Submission of Matters to a Vote of Security Holders</font></a></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><a href="#page15"><font style="opacity:100; position:relative; ">15</font></a></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><a href="#page15"><font style="opacity:100; position:relative; ">Item 6 &ndash; Exhibits</font></a></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><a href="#page15"><font style="opacity:100; position:relative; ">15</font></a></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><a href="#page16"><font style="opacity:100; position:relative; ">Signatures and Certifications</font></a></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><a href="#page16"><font style="opacity:100; position:relative; ">16</font></a></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
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<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>
<a name="page3"></a><font style="font-family:serif;font-weight:normal;color:#000000;font-size:8pt;  text-align: left; font-style: normal; line-height: 10pt; background-color: #ffffff"><a href="#toc">Table of Contents</a></font>
<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: pt; padding-bottom: 0pt; background-color: #ffffff;">
<font style="opacity:100; position:relative; ">Part I:&nbsp;&nbsp;&nbsp;&nbsp;Financial Information:</font>
</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;">
<font style="opacity:100; position:relative; ">Item 1 &mdash; Financial Statements:</font>
</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;">
<font style="opacity:100; position:relative; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;CPI AEROSTRUCTURES, INC.</font>
<br>
</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: 6pt; background-color: #ffffff;">
<font style="opacity:100; position:relative; ">CONDENSED BALANCE SHEETS</font>
</p>
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<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">June 30,</font>
<br>
<font style="opacity:100; position:relative; ">2007</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">December 31,</font>
<br>
<font style="opacity:100; position:relative; ">2006</font></font></td>
</tr>
<tr>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">(Unaudited)</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">(Note 1)</font></font></td>
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<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">ASSETS</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Current Assets:</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Cash</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,041,745</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">38,564</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Accounts receivable, net</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,756,599</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,422,135</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Costs and estimated earnings in excess of billings on uncompleted contracts</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">29,326,300</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">28,783,708</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Prepaid expenses and other current assets</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">403,882</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">133,618</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Refundable income taxes</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">528,470</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">628,470</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">Total current assets</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: bold; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: bold; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">33,056,996</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: bold; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: bold; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: bold; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">31,006,495</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: bold; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Plant and equipment, net</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">781,492</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">855,736</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Other assets</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">229,319</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">297,956</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">Total Assets</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 3px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff; font-weight: bold; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff;font-weight: bold; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">34,067,807</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: bold; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 3px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff; font-weight: bold; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff;font-weight: bold; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">32,160,187</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: bold; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">LIABILITIES AND SHAREHOLDERS&rsquo; EQUITY</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Current liabilities:</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Accounts payable</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">4,919,126</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">4,758,763</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Accrued expenses</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">102,751</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">225,040</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Current portion of long-term debt</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">14,215</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">42,188</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Line of credit</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&mdash;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">350,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Deferred income taxes</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">508,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">508,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">Total current liabilities</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: bold; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: bold; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">5,544,092</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: bold; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: bold; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: bold; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">5,883,991</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: bold; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Other liabilities</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">114,570</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">98,541</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">Total Liabilities</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff; font-weight: bold; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff;font-weight: bold; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">5,658,662</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: bold; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff; font-weight: bold; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff;font-weight: bold; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">5,982,532</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: bold; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 8pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Shareholders&rsquo; Equity:</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 8pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 8pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 8pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 8pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 8pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 8pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Common stock &ndash; $.001 par value; authorized 50,000,000 shares,</font>
<br>
<font style="opacity:100; position:relative; "> issued 5,793,807 and 5,478,807 shares, respectively, and</font>
<br>
<font style="opacity:100; position:relative; "> outstanding 5,730,273 and 5,447,792 shares, respectively</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">5,794</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">5,479</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Additional paid-in capital</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">24,656,208</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">23,048,520</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Retained earnings</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">4,288,149</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">3,444,512</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Treasury stock, 63,534 and 32,980 shares (at cost), respectively</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(541,006</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(320,856</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">Total Shareholders&rsquo; Equity</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff; font-weight: bold; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff;font-weight: bold; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">28,409,145</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: bold; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff; font-weight: bold; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff;font-weight: bold; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">26,177,655</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: bold; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">Total Liabilities and Shareholders&rsquo; Equity</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 3px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #ffffff; font-weight: bold; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #ffffff;font-weight: bold; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">34,067,807</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: bold; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 3px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #ffffff; font-weight: bold; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #ffffff;font-weight: bold; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">32,160,187</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: bold; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
</table>
</div>
</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">
<font style="opacity:100; position:relative; ">See Notes to Condensed Financial Statements</font>
</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>
<a name="page4"></a><font style="font-family:serif;font-weight:normal;color:#000000;font-size:8pt;  text-align: left; font-style: normal; line-height: 10pt; background-color: #ffffff"><a href="#toc">Table of Contents</a></font>
<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;">
<font style="opacity:100; position:relative; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;CPI AEROSTRUCTURES, INC.</font>
<br>
<font style="font-weight:bold; font-style:normal">&nbsp;</font>
</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: 6pt; background-color: #ffffff;">
<font style="opacity:100; position:relative; ">CONDENSED STATEMENTS OF OPERATIONS</font>
</p>
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<td bgcolor="#000000"><img src="spacer.gif" height="4"><img src="spacer.gif" height="4" width="602"></td>
<td><img src="spacer.gif" height="4" width="0"></td>
</tr>
<tr>
<td><img src="spacer.gif" height="8" width="4"></td>
</tr>
</table>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px solid #FFFFFF; width: 602px; padding-top: 6px; border-left:none;margin-bottom:10px;" align="left">
<div class="WhiteBorder" style="padding:0;margin:0;text-align:center;">
<table style="border-top:none; border-bottom:none;border-left:none; border-right:none;margin-left:0px; " cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
<tr style="background-color:none">
<td><img src="spacer.gif" height="1" width="299"></td>
<td><img src="spacer.gif" height="1" width="6"></td>
<td><img src="spacer.gif" height="1" width="4.40"></td>
<td><img src="spacer.gif" height="1" width="0"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="60"></td>
<td><img src="spacer.gif" height="1" width="0"></td>
<td><img src="spacer.gif" height="1" width="4.40"></td>
<td><img src="spacer.gif" height="1" width="4.40"></td>
<td><img src="spacer.gif" height="1" width="0"></td>
<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="0"></td>
<td><img src="spacer.gif" height="1" width="4.40"></td>
<td><img src="spacer.gif" height="1" width="4.40"></td>
<td><img src="spacer.gif" height="1" width="0"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="67"></td>
<td><img src="spacer.gif" height="1" width="0"></td>
<td><img src="spacer.gif" height="1" width="4.40"></td>
<td><img src="spacer.gif" height="1" width="4.40"></td>
<td><img src="spacer.gif" height="1" width="0"></td>
<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="0"></td>
</tr>
<tr>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="10"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">For the Three</font>
<br>
<font style="opacity:100; position:relative; ">Months Ended June 30,</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="10"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">For the Six</font>
<br>
<font style="opacity:100; position:relative; ">Months Ended June 30,</font></font></td>
</tr>
<tr>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">2007</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">2006</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">2007</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">2006</font></font></td>
</tr>
<tr>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="10"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">(Unaudited)</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="10"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">(Unaudited)</font></font></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Revenue</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">7,490,669</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">2,457,016</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">12,962,637</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">7,487,210</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Cost of sales </font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">5,302,049</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">3,361,506</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">9,415,336</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">7,426,508</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Gross profit (loss)</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">2,188,620</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(904,490</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">3,547,301</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">60,702</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Selling, general and administrative expenses</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,262,172</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,133,844</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">2,185,664</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,982,142</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Income (loss) before provision for (benefit from)</font>
<br>
<font style="opacity:100; position:relative; "> income taxes</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">926,448</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(2,038,334</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,361,637</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(1,921,440</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Provision for (benefit from) income taxes</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">351,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(705,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">518,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(657,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Net income (loss)</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">575,448</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(1,333,334</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">843,637</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(1,264,440</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Income (loss) per common share &ndash; basic</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">0.10</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(0.24</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">0.15</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(0.23</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Income (loss) per common share &ndash; diluted</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 3px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">0.10</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 3px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(0.24</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 3px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">0.14</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 3px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(0.23</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Shares used in computing income (loss) per common share:</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Basic </font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">5,691,811</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">5,447,042</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">5,596,963</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">5,446,263</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Diluted</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">6,026,829</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">5,447,042</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">5,908,891</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">5,446,263</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
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<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">
<font style="opacity:100; position:relative; ">See Notes to Condensed Financial Statements</font>
</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>
<a name="page5"></a><font style="font-family:serif;font-weight:normal;color:#000000;font-size:8pt;  text-align: left; font-style: normal; line-height: 10pt; background-color: #ffffff"><a href="#toc">Table of Contents</a></font>
<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;">
<font style="opacity:100; position:relative; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;CPI AEROSTRUCTURES, INC.</font>
<br>
<font style="font-weight:bold; font-style:normal">&nbsp;</font>
</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: 6pt; background-color: #ffffff;">
<font style="opacity:100; position:relative; ">CONDENSED STATEMENTS OF CASH FLOWS</font>
</p>
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<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="10"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">For the Six</font>
<br>
<font style="opacity:100; position:relative; ">Months Ended June 30,</font></font></td>
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<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">2007</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">2006</font></font></td>
</tr>
<tr>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="10"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">(Unaudited)</font></font></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Cash flows from operating activities:</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Net income (loss)</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">843,637</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(1,264,440</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Adjustments to reconcile net income to net</font>
<br>
<font style="opacity:100; position:relative; "> cash provided by (used in) operating activities:</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Depreciation and amortization</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">110,506</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">103,249</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Other liabilities</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">16,029</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">21,825</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Stock compensation expense</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">360,252</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">252,425</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Tax benefit from stock option exercise</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(538,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(4,600</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Deferred portion of provision for income taxes</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">57,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(48,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Changes in operating assets and liabilities:</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 40pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Increase in accounts receivable</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(334,464</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(368,616</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 40pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">(Increase) decrease in costs and estimated earnings in excess of billings on uncompleted contracts</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(542,592</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">3,171,318</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 40pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Decrease in prepaid expenses and other assets</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">279,374</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">195,663</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 40pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">(Increase) decrease in refundable income taxes</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">100,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(890,281</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 40pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Increase (decrease) in accounts payable and accrued expenses </font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">38,074</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(1,415,273</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 40pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Decrease in income taxes payable</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&mdash;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(133,110</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 50pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Net cash provided by (used in) operating activities</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">389,816</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(379,840</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Cash used in investing activities &ndash; purchase of plant and equipment</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 12pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 12pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(36,262</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 12pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 12pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 12pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(51,093</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 12pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Cash flows from financing activities:</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Payment of long-term debt</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(27,973</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(47,749</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Repayment of line of credit</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(350,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&mdash;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Proceeds from exercise of stock options</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">489,600</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">19,050</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Tax benefit from stock option exercise</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">538,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">4,600</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 50pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Net cash provided by (used in) financing activities</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">649,627</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(24,099</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Net increase (decrease) in cash</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,003,181</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(455,032</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Cash at beginning of period</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 12pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 12pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">38,564</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 12pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 12pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 12pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">877,182</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 12pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Cash at end of period</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 3px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,041,745</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 3px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">422,150</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Supplemental disclosures of cash flow information:</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 12pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 12pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 12pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 12pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 12pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 12pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 12pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Cash paid during the period for:</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 12pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Interest</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 3px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">18,284</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 3px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">6,117</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 20pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Income taxes</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 3px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">100,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 3px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">403,093</font></td>
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<font style="opacity:100; position:relative; ">See Notes to Condensed Financial Statements</font>
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<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">5</p>
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<font style="opacity:100; position:relative; font-variant:none; text-transform:uppercase;">CPI Aerostructures, Inc.</font>
<br>
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<font style="opacity:100; position:relative; ">NOTES TO CONDENSED FINANCIAL STATEMENTS</font>
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<font style="opacity:100; position:relative; font-variant:none; text-transform:uppercase;">(UNAUDITED)</font>
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<font style="opacity:100; position:relative; ">1. </font><font style="opacity:100; position:relative; font-variant:none; text-transform:uppercase;">Interim Financial Statements</font><font style="opacity:100; position:relative; ">:</font>
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<font style="opacity:100; position:relative; ">The financial statements of CPI Aerostructures, Inc. (the &lsquo;&lsquo;Company&rsquo;&rsquo;) as of June&nbsp;30,&nbsp;2007 and for the three and six months ended June&nbsp;30,&nbsp;2007 and 2006 are unaudited, however, in the opinion of the management of the Company, these financial statements reflect all adjustments (consisting solely of normal recurring adjustments) necessary to present fairly the financial position of the Company and its results of operations and cash flows. The results of operations for such interim periods are not necessarily indicative of the results to be obtained for a full year.</font>
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<font style="opacity:100; position:relative; ">The balance sheet at December&nbsp;31,&nbsp;2006 has been derived from the audited financial statements at that date; but does not include all of the information and notes required by accounting principles generally accepted in the United States for complete financial statements. For further information, refer to the financial statements and notes thereto included in the Company&rsquo;s Annual Report on Form 10-K for the year ended December&nbsp;31,&nbsp;2006.</font>
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<font style="opacity:100; position:relative; font-variant:none; text-transform:uppercase;">2. stock-based compensation:</font>
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<font style="opacity:100; position:relative; ">The Company accounts for compensation expense associated with stock options in accordance with Statement of Financial Accounting Standards (&lsquo;&lsquo;SFAS&rsquo;&rsquo;) No. 123R, &lsquo;&lsquo;Share-Based Payment.&rsquo;&rsquo;</font>
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<font style="opacity:100; position:relative; ">The Company&rsquo;s net income for the three and six months ended June&nbsp;30,&nbsp;2007 includes approximately $251,000 and $360,000, respectively, of non-cash compensation expense related to the Company&rsquo;s stock options. The Company&rsquo;s net loss for the three and six months ended June&nbsp;30,&nbsp;2006 includes approximately $154,000 and $252,000, respectively, of non-cash compensation expense related to the Company&rsquo;s stock options. The non-cash compensation expense related to all of the Company&rsquo;s stock-based compensation arrangements is recorded as a component of selling, general and administrative expenses.</font>
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<font style="opacity:100; position:relative; ">The estimated fair value of each option award granted was determined on the date of grant using the Black-Scholes option valuation model. The following weighted-average assumptions were used for option grants during the six month period ended June&nbsp;30,&nbsp;2007:</font>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Risk-free interest rate </font></font></td>
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<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #cceeff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">4.50% - 5.25%</font></font></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Expected volatility</font></font></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">61% - 73%</font></font></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Dividend yield</font></font></td>
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<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #cceeff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">0%</font></font></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Expected option term-in years </font></font></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">5</font></font></td>
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<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">6</p>
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<a name="page7"></a><font style="font-family:serif;font-weight:normal;color:#000000;font-size:8pt;  text-align: left; font-style: normal; line-height: 10pt; background-color: #ffffff"><a href="#toc">Table of Contents</a></font>
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<font style="opacity:100; position:relative; font-variant:none; text-transform:uppercase;">CPI Aerostructures, Inc.</font>
<br>
</p>
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<font style="opacity:100; position:relative; ">NOTES TO CONDENSED FINANCIAL STATEMENTS</font>
<br>
<font style="opacity:100; position:relative; font-variant:none; text-transform:uppercase;">(UNAUDITED)</font>
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<font style="opacity:100; position:relative; ">A summary of the status of the Company&rsquo;s stock option plans as of June&nbsp;30,&nbsp;2007 and changes during the period is as follows:</font>
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<td><img src="spacer.gif" height="1" width="1"></td>
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<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Fixed Options</font></font></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Options</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Weighted average</font>
<br>
<font style="opacity:100; position:relative; ">Exercise Price</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Weighted average</font>
<br>
<font style="opacity:100; position:relative; "> remaining</font>
<br>
<font style="opacity:100; position:relative; ">contractual</font>
<br>
<font style="opacity:100; position:relative; ">term (in years)</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Aggregate</font>
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<font style="opacity:100; position:relative; ">Intrinsic</font>
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<font style="opacity:100; position:relative; ">Value</font></font></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Outstanding at beginning of period</font></font></td>
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<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,240,418</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">5.17</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Granted during period</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">80,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">7.01</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Exercised</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">(315,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><font style="position:absolute;white-space:nowrap;line-height:12pt"><font style="opacity:100; position:relative; ">)</font></font>&nbsp;
								</td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">2.25</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom:  1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom:  1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom:  1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom:  1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">&nbsp;</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Outstanding at end of period</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 3px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,005,418</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 3px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">6.24</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 3px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">4.46</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom:  1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 3px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">2,530,326</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Vested at end of period</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 3px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">980,418</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 3px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">6.23</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 3px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">4.33</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom:  1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 3px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px double #000000;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">2,491,576</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 3px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
</table>
</div>
</div>
<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">
<font style="opacity:100; position:relative; ">As of June&nbsp;30,&nbsp;2007, there was $76,105 of unrecognized compensation cost related to non-vested stock option awards which will be amortized through December&nbsp;2008.</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: 20pt; background-color: #ffffff">
<font style="opacity:100; position:relative; ">During the six months ended June&nbsp;30,&nbsp;2007, 230,000 stock options were exercised for cash resulting in proceeds to the Company of $489,600. In addition, 85,000 stock options were exercised on a cashless basis, pursuant to provisions of the stock option plans. The Company received 30,554 shares of its common stock in exchange for the 85,000 shares issued in the exercise. The 30,554 shares that the Company received were valued at $220,150, the fair market value of the shares on the date of exercise, and were added to treasury stock.</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: 20pt; background-color: #ffffff">
<font style="opacity:100; position:relative; ">During the six months ended June&nbsp;30,&nbsp;2007, the company earned a tax benefit of approximately $538,000 resulting from the exercise of stock options.&nbsp;The amount has been credited to paid in capital and applied to the current tax liability with the balance of $277,000 reflected in prepaid expenses and other current assets.</font>
</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;">
<font style="opacity:100; position:relative; ">3. </font><font style="opacity:100; position:relative; font-variant:none; text-transform:uppercase;">costs and estimated earnings in excess of billings on uncompleted contracts:</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: 6pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">
<font style="opacity:100; position:relative; ">Costs and estimated earnings in excess of billings on uncompleted contracts consist of:</font>
</p>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px solid #FFFFFF; width: 602px; padding-top: 12px; border-left:none;margin-bottom:10px;" align="left">
<div class="WhiteBorder" style="padding:0;margin:0;text-align:center;">
<table style="border-top:none; border-bottom:none;border-left:none; border-right:none;margin-left:0px; " cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
<tr style="background-color:none">
<td><img src="spacer.gif" height="1" width="320"></td>
<td><img src="spacer.gif" height="1" width="6"></td>
<td><img src="spacer.gif" height="1" width="8.13"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="67"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<td><img src="spacer.gif" height="1" width="8.13"></td>
<td><img src="spacer.gif" height="1" width="8.13"></td>
<td><img src="spacer.gif" height="1" width="0"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="67"></td>
<td><img src="spacer.gif" height="1" width="0"></td>
<td><img src="spacer.gif" height="1" width="8.13"></td>
<td><img src="spacer.gif" height="1" width="8.13"></td>
<td><img src="spacer.gif" height="1" width="0"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="73"></td>
<td><img src="spacer.gif" height="1" width="0"></td>
</tr>
<tr>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="16"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">June&nbsp;30,&nbsp;2007</font></font></td>
</tr>
<tr>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">U.S. Government</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Commercial</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Total</font></font></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Costs incurred on uncompleted contracts</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">51,105,784</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">15,622,461</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">66,728,245</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Estimated earnings</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">31,880,494</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">6,853,813</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">38,734,307</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Sub-total</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">82,986,278</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">22,476,274</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">105,462,552</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Less billings to date</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">55,388,261</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">20,747,991</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">76,136,252</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">Costs and estimated earnings in excess of billings on uncompleted contracts</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">27,598,017</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,728,283</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">29,326,300</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
</table>
</div>
</div>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px solid #FFFFFF; width: 602px; padding-top: 6px; border-left:none;margin-bottom:10px;" align="left">
<div class="WhiteBorder" style="padding:0;margin:0;text-align:center;">
<table style="border-top:none; border-bottom:none;border-left:none; border-right:none;margin-left:0px; " cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
<tr style="background-color:none">
<td><img src="spacer.gif" height="1" width="321"></td>
<td><img src="spacer.gif" height="1" width="6"></td>
<td><img src="spacer.gif" height="1" width="8.96"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="67"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<td><img src="spacer.gif" height="1" width="8.96"></td>
<td><img src="spacer.gif" height="1" width="8.96"></td>
<td><img src="spacer.gif" height="1" width="0"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="67"></td>
<td><img src="spacer.gif" height="1" width="0"></td>
<td><img src="spacer.gif" height="1" width="8.96"></td>
<td><img src="spacer.gif" height="1" width="8.96"></td>
<td><img src="spacer.gif" height="1" width="0"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="67"></td>
<td><img src="spacer.gif" height="1" width="0"></td>
</tr>
<tr>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="16"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">December&nbsp;31,&nbsp;2006</font></font></td>
</tr>
<tr>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">U.S. Government</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Commercial</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Total</font></font></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Costs incurred on uncompleted contracts</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">45,799,483</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">15,312,176</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">61,111,659</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Estimated earnings</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">27,022,765</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">6,666,257</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">33,689,022</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Sub-total</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">72,822,248</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">21,978,433</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">94,800,681</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
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<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Less billings to date</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">45,978,150</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">20,038,823</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">66,016,973</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">Costs and estimated earnings in excess of billings on uncompleted contracts</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">26,844,098</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,939,610</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><font style="opacity:100; position:relative; ">$</font></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">28,783,708</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
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<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">7</p>
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<font style="opacity:100; position:relative; font-variant:none; text-transform:uppercase;">CPI Aerostructures, Inc.</font>
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<font style="opacity:100; position:relative; ">NOTES TO CONDENSED FINANCIAL STATEMENTS</font>
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<font style="opacity:100; position:relative; font-variant:none; text-transform:uppercase;">(UNAUDITED)</font>
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<font style="opacity:100; position:relative; ">4. </font><font style="opacity:100; position:relative; font-variant:none; text-transform:uppercase;">income PER COMMON SHARE:</font>
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<font style="opacity:100; position:relative; ">Basic income per common share is computed using the weighted average number of shares outstanding. Diluted income per common share for the three and six month periods ended June&nbsp;30,&nbsp;2007 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 335,018 and 311,928 were used in the calculation of diluted income per common share in the three month and six month periods ended June&nbsp;30,&nbsp;2007, respectively. Incremental shares of 295,000 and 333,750 were not included in the diluted earnings per share calculations for the three month and six month periods ended June&nbsp;30,&nbsp;2007, respectively, as their exercise price was in excess of the Company&rsquo;s average stock price for the period and, accordingly, these shares are not assumed to be exercised for the diluted earnings per share calculation, as they w
ould be anti-dilutive. Incremental shares of 865,277 were not included in the diluted earnings per share calculation at June&nbsp;30,&nbsp;2006 because of the reported net loss, and accordingly their effect would be anti-dilutive.</font>
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<font style="opacity:100; position:relative; ">5. CREDIT FACILITY:</font>
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<font style="opacity:100; position:relative; ">In September&nbsp;2003, the Company entered into a three year, revolving credit facility with JP Morgan Chase Bank (the &lsquo;&lsquo;Chase Facility&rsquo;&rsquo;), secured by our assets. In August&nbsp;2006, the Company borrowed $350,000 under the Chase Facility. The Chase Facility was amended and restated in October&nbsp;2006, further amended in May&nbsp;2007 and it expired on June&nbsp;30,&nbsp;2007. All borrowings under this facility were repaid in May&nbsp;2007.</font>
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<font style="opacity:100; position:relative; ">6. </font><font style="opacity:100; position:relative; font-variant:none; text-transform:uppercase;">recent accounting pronouncements:</font>
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<font style="opacity:100; position:relative; ">In June&nbsp;2006, the FASB issued FASB Interpretation 48, &lsquo;&lsquo;Accounting for Uncertainty in Income Taxes (as amended) &mdash; an interpretation of Statement of Accounting Standards 109&rsquo;&rsquo; (&lsquo;&lsquo;FIN 48&rsquo;&rsquo;). FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprise&rsquo;s financial statements in accordance with SFAS 109, &lsquo;&lsquo;Accounting for Income Taxes,&rsquo;&rsquo; and prescribes a recognition threshold and measurement attribute for the financial statements recognition and measurement of a tax position taken or expected to be taken in a tax return. FIN 48 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. During the six months ended June&nbsp;30,&nbsp;2007, the Company adopted FIN 48 and the impact of adoption was not material to its financial position and results of operations.</font>
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<font style="opacity:100; position:relative; ">We may, from time to time, be assessed interest and/or penalties by major taxing jurisdictions, although any such assessments historically have been minimal and immaterial to our financial results. In the event we have received an assessment for interest and/or penalties, it has been classified in the statement of operations as other general and administrative expenses.</font>
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<font style="opacity:100; position:relative; ">7. </font><font style="opacity:100; position:relative; font-variant:none; text-transform:uppercase;">Subsequent event:</font>
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<font style="opacity:100; position:relative; ">In August&nbsp;2007, the Company entered into a new two-year, $2.5&nbsp;million revolving credit facility with Sovereign Bank (the &lsquo;&lsquo;Sovereign Facility&rsquo;&rsquo;), secured by the Company&rsquo;s assets. The Sovereign Facility specifies an interest rate equal to the lower of LIBOR plus 2% or Sovereign Bank&rsquo;s prime rate. The Sovereign Facility contains financial covenants related to interest coverage, net income and capital expenditures, as defined in the agreement.</font>
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<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">8</p>
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<font style="opacity:100; position:relative; ">Item 2 &mdash; Management&rsquo;s Discussion and Analysis of Financial Condition and Results of Operations</font>
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<font style="opacity:100; position:relative; ">The following discussion should be read in conjunction with the Company&rsquo;s Condensed Financial Statements and footnotes thereto contained in this report.</font>
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<font style="opacity:100; position:relative; ">Forward Looking Statements</font>
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<font style="opacity:100; position:relative; ">When used in this Form 10-Q and in future filings by us with the Commission, the words or phrases &lsquo;&lsquo;will likely result,&rsquo;&rsquo; &lsquo;&lsquo;management expects&rsquo;&rsquo; or &lsquo;&lsquo;we expect,&rsquo;&rsquo; &lsquo;&lsquo;will continue,&rsquo;&rsquo; &lsquo;&lsquo;is anticipated,&rsquo;&rsquo; &lsquo;&lsquo;estimated&rsquo;&rsquo; or similar expressions are intended to identify &lsquo;&lsquo;forward-looking statements&rsquo;&rsquo; within the meaning of the Private Securities Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance on any such forward-looking statements, each of which speaks only as of the date made. Such statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical earnings and those presently anticipated or projected. The risks are included in &lsquo;&lsquo;Item 1A: Risk Factors&rsquo;&rsquo; included in our Annual Report on Form
 10-K for the year ended December&nbsp;31,&nbsp;2006 and &lsquo;&lsquo;Item 7: Management&rsquo;s Discussion and Analysis of Financial Condition and Results of Operations&rsquo;&rsquo; included in this Form 10-Q. We have no obligation to publicly release the result of any revisions, which may be made to any forward-looking statements to reflect anticipated or unanticipated events or circumstances occurring after the date of such statements.</font>
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<font style="opacity:100; position:relative; ">Business Operations</font>
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<font style="opacity:100; position:relative; ">We are engaged in the contract production of structural aircraft parts principally for the United States Air Force and other branches of the U.S. armed forces and, to a lesser extent, for prime military aircraft contractors. We also provide aircraft parts to the commercial sector of the aircraft industry. Our strategy for growth has focused on government and military sales as a prime contractor and as a subcontractor for other defense prime contractors. Due to growth in the commercial sector, we are also pursuing opportunities to increase our commercial contract business as a subcontractor.</font>
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<font style="opacity:100; position:relative; ">Notwithstanding defense budget increases and the Department of Defense&rsquo;s (&lsquo;&lsquo;DoD&rsquo;&rsquo;) commitment to maintaining support for aging aircraft during the two-year period through August&nbsp;2006, there was a significant slowdown in government contract awards as well as releases under previously awarded contracts. Faced with the uncertainties of appropriations and timing of contract awards and releases under previously awarded contracts, which we believe have been driven by the uncertainties of war and market and economic trends, we have expanded our activities to include operating as a subcontractor to leading aerospace prime contractors. While the slowdown in government contract awards also has affected these prime contractors, because they are able to bid on and receive contract awards for different programs than we are, we believe that pursuing such opportunities will enable us to access programs that we would not otherwise be able to a
ccess given our smaller size and resources. By increasing our customer base, we have positioned our company to take advantage of additional market opportunities and reduce the impact of the slowdown in government contract awards and releases. These subcontracting opportunities have begun to materialize, and we were awarded approximately $7.0&nbsp;million of subcontracts during 2006 compared to $2.2&nbsp;million in 2005. In addition, through July&nbsp;31,&nbsp;2007, we were awarded approximately $10.9&nbsp;million of subcontracts. We currently have proposals submitted to multiple prime contractors, and while we cannot predict the timing of awards, some of our outstanding proposals are so significant in size that any single award could increase our revenue and net income substantially.</font>
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<font style="opacity:100; position:relative; ">The length of the contract varies but is typically between six months and two years for U.S. government contracts (although our T-38 contract and our C-5 TOP contract are for periods of 10 years and 7 years, respectively), and up to 10 years for commercial contracts. Our one commercial contract has an indefinite life. Except in cases where contract terms permit us to bill on a progress basis, we must incur upfront costs in producing assemblies and bill our customers upon delivery. Because of the upfront costs incurred, the timing of our billings and the nature of the percentage-of-completion method of accounting described below, there can be a significant disparity between the periods in which (a) costs are expended, (b) revenue and earnings are recorded and (c) cash is received.</font>
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<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">9</p>
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<font style="opacity:100; position:relative; ">Item 2 &mdash; Management&rsquo;s Discussion and Analysis of Financial Condition and Results of Operations</font>
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<font style="opacity:100; position:relative; ">Critical Accounting Policies</font>
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<font style="opacity:100; position:relative; font-weight: bold; font-style: italic;">Revenue Recognition</font>
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<font style="opacity:100; position:relative; ">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 &lsquo;&lsquo;Costs and estimated earnings in excess of billings on uncompleted contracts.&rsquo;&rsquo; Contracts where billings to date have exceeded recognized revenues are recorded as a liability captioned &lsquo;&lsquo;Billings in excess of costs and estimated earnings on uncompleted contracts.&rsquo;&rsquo; 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 you 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 fund our work in process or to pay taxes until the reported earnings materialize to actual cash receipts.</font>
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<font style="opacity:100; position:relative; ">Stock Based Compensation</font>
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<font style="opacity:100; position:relative; ">Effective January&nbsp;1,&nbsp;2006, we adopted SFAS No. 123R, &lsquo;&lsquo;Share-Based Payment&rsquo;&rsquo; for employee options, using the modified prospective transition method. SFAS 123R revised SFAS 123 to eliminate the option to use the intrinsic value method and required the Company to expense the fair value of all employee stock-based compensation over the vesting period. Under the modified prospective transition method, we recognized compensation cost for the year ended December&nbsp;31,&nbsp;2006, which includes (1) period compensation cost related to share-based payments granted prior to, but not yet vested as of, January&nbsp;1,&nbsp;2006, based on the grant date fair value estimated in accordance with the original provisions of SFAS 123 and (2) compensation cost related to share-based payments granted within the period, which vested fully upon grant.</font>
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<font style="opacity:100; position:relative; ">Results of Operations</font>
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<font style="opacity:100; position:relative; font-weight: bold; font-style: italic;">Revenue </font>
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<font style="opacity:100; position:relative; ">Revenue for the three months ended June&nbsp;30,&nbsp;2007 was $7,490,669 compared to $2,457,016 for the same period last year, representing an increase of $5,033,653 or 205%. For the six months ended June&nbsp;30,&nbsp;2007, revenue increased $5,475,427 or 73% to $12,962,637, compared to $7,487,210 for the six&nbsp;months ended June&nbsp;30,&nbsp;2006.</font>
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<font style="opacity:100; position:relative; ">We generate revenue primarily from government contracts and, to a lesser extent, from one commercial contract. Revenue from government contracts (including subcontract work for government aircraft) for the six months ended June&nbsp;30,&nbsp;2007 was $12,464,796 compared to $6,688,492 for the six months ended June&nbsp;30,&nbsp;2006, an increase of $5,776,304 or 86%. Our one commercial contract accounted for revenue of approximately $497,841 for the six months ended June&nbsp;30,&nbsp;2007 compared to approximately $798,718 for the six months ended June&nbsp;30,&nbsp;2006.</font>
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<font style="opacity:100; position:relative; ">In the second half of 2006, we received approximately $22.0&nbsp;million of new government contract awards. Included in 2006 contract awards were approximately $7.0&nbsp;million of awards for subcontract </font>
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<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">10</p>
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<font style="opacity:100; position:relative; ">Item 2 &mdash; Management&rsquo;s Discussion and Analysis of Financial Condition and Results of Operations</font>
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work. During the six months ended June&nbsp;30,&nbsp;2007, we received approximately $8.6&nbsp;million of new contract awards including approximately $7.7&nbsp;million of subcontract work, compared to $7.9&nbsp;million of new contract awards in the same period last year. Included in last years&rsquo; award amount is a $5.0&nbsp;million release on our C-5 TOP contract. Revenue increased in the first six months of 2007 as we have been performing on these contracts.</font>
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<font style="opacity:100; position:relative; ">As of June&nbsp;30,&nbsp;2007, we had approximately $285&nbsp;million in bids outstanding. We continue to make bids on contracts on a weekly basis.</font>
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<font style="opacity:100; position:relative; font-weight: bold; font-style: italic;">Gross Profit</font>
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<font style="opacity:100; position:relative; ">Gross profit for the three months ended June&nbsp;30,&nbsp;2007 was $2,188,620 compared to a gross loss of $904,490 for the three months ended June&nbsp;30,&nbsp;2006, an increase of $3,093,110. As a percentage of revenue, gross profit for the three months ended June&nbsp;30,&nbsp;2007 was 29% compared to gross loss of 37% for the same period last year. For the six months ended June&nbsp;30,&nbsp;2007, gross profit was $3,547,301, or 27% of revenue, compared with $60,702, or 1% of revenue for the first six months of last year.</font>
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<font style="opacity:100; position:relative; ">During the six months ended June&nbsp;30,&nbsp;2006, we incurred overtime and rework costs to correct poor supplier workmanship and delays in deliveries by some of our suppliers. In addition, we had maintained our factory overhead and labor cost structure in anticipation of releases on contracts that we had already been awarded, including the C-5 TOP contract, as well as new awards on some of our major outstanding bids. At the end of the second quarter of 2006, when these awards did not materialize, we reduced our labor force by approximately 12% and took other cost saving measures in an attempt to increase gross profit. The increase in gross profit percentage for the six months ended June&nbsp;30,&nbsp;2007 was due to better control over suppliers and an improved factory overhead application rate.</font>
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<font style="opacity:100; position:relative; ">We anticipate that our overhead costs for the remainder of the year will remain consistent with those incurred in the six months ended June&nbsp;30,&nbsp;2007. Therefore, if the level of shop activity remains similar to our present level, overhead rates and gross margin should remain similar to our current rates.</font>
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<font style="opacity:100; position:relative; font-weight: bold; font-style: italic;">Selling, General and Administrative Expenses</font>
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<font style="opacity:100; position:relative; ">Selling, general and administrative expenses for the three months ended June&nbsp;30,&nbsp;2007 were $1,262,172 compared to $1,133,844 for the three months ended June&nbsp;30,&nbsp;2006, an increase of $128,328, or 11%. For the six months ended June&nbsp;30,&nbsp;2007, selling, general and administrative expenses were $2,185,664 compared to $1,982,142 for the same period last year, an increase of $203,522, or 10%. This increase was primarily due to:</font>
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<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; font-style: normal; width: 20pt;"></td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; padding-bottom: 3pt; text-align: left; font-style: normal; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">&bull;</font>&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; padding-bottom: 3pt; text-align: left; font-style: normal; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">a $182,000 increase in consulting fees related to bids and proposals;</font></td>
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<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; font-style: normal; width: 20pt;"></td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; padding-bottom: 3pt; text-align: left; font-style: normal; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">&bull;</font>&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; padding-bottom: 3pt; text-align: left; font-style: normal; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">a $73,000 increase in public company fees, which includes fees paid for investor relations, fees for printing our reports and SEC filings, transfer agent fees and other expenses associated with being a public company;</font></td>
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<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; font-style: normal; width: 20pt;"></td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; padding-bottom: 3pt; text-align: left; font-style: normal; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">&bull;</font>&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; padding-bottom: 3pt; text-align: left; font-style: normal; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">a $54,000 increase in stock compensation expense; and</font></td>
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<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; font-style: normal; width: 20pt;"></td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; padding-bottom: 3pt; text-align: left; font-style: normal; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">&bull;</font>&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; padding-bottom: 3pt; text-align: left; font-style: normal; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">a $49,000 increase in travel expenses related to trips for vendor management and subcontracting sales.</font></td>
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<font style="opacity:100; position:relative; ">This increase was offset by a decrease in salaries of $82,000 and a decrease in accounting and legal fees of $84,000.</font>
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<font style="opacity:100; position:relative; font-weight: bold; font-style: italic;">Income (Loss) Before Provision for (Benefit from) Income Taxes</font>
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<font style="opacity:100; position:relative; ">Income before provision for income taxes for the three months ended June&nbsp;30,&nbsp;2007 was $926,448 compared to loss before benefit from income taxes of $2,038,334 for the same period last year, an </font>
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<font style="opacity:100; position:relative; ">Item 2 &mdash; Management&rsquo;s Discussion and Analysis of Financial Condition and Results of Operations</font>
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increase of $2,964,782. For the six months ended June&nbsp;30,&nbsp;2007, income before provision for income taxes was $1,361,637 compared to a loss before benefit from income taxes of $1,921,440 for the same period last year, an increase of $3,283,077. This increase was primarily due to the increase in gross profit described above.</font>
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<font style="opacity:100; position:relative; font-weight: bold; font-style: italic;">Provision for (Benefit from) Income Taxes</font>
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<font style="opacity:100; position:relative; ">Provision for income taxes was $518,000 for the six months ended June&nbsp;30,&nbsp;2007, or 38% of pre-tax income. For the three months ended June&nbsp;30,&nbsp;2007, the provision for income taxes was $351,000, or 38% of pre-tax income. There was a benefit from income taxes for the three months ended June&nbsp;30,&nbsp;2006 of $705,000, which was the result of a recovery of taxes expensed in the first quarter of 2006, as well as federal taxes paid in 2005 which are refundable through the filing of a carryback claim. There was a benefit from income taxes of $657,000 for the six months ended June&nbsp;30,&nbsp;2006, which was the result of the refundable 2005 taxes paid.</font>
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<font style="opacity:100; position:relative; font-weight: bold; font-style: italic;">Net Income</font>
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<font style="opacity:100; position:relative; ">As a result, basic net income for the three months ended June&nbsp;30,&nbsp;2007 was $575,448, or $0.10 per basic share, compared to a net loss of $1,333,334, or $0.24 per basic share, for the same period last year. For the six months ended June&nbsp;30,&nbsp;2007, basic net income was $843,637, or $0.15 per basic share, compared with a net loss of $1,264,440, or $0.23 per basic share, for the same period last year. Diluted income per share for the three months ended June&nbsp;30,&nbsp;2007 was $0.10, calculated utilizing 6,026,829 average shares outstanding. Diluted income per share for the six months ended June&nbsp;30, 2007 was $0.14, calculated utilizing 5,908,891 average shares outstanding. Diluted loss per share for the three and six months ended June&nbsp;30,&nbsp;2006 is the same as basic loss per share because the effect of 865,277 incremental shares were not taken into account as such effect would be anti-dilutive.</font>
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<font style="opacity:100; position:relative; ">Liquidity and Capital Resources</font>
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<font style="opacity:100; position:relative; font-weight: bold; font-style: italic;">General</font>
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<font style="opacity:100; position:relative; ">At June&nbsp;30,&nbsp;2007, we had working capital of $27,512,904 compared to $25,122,504 at December&nbsp;31,&nbsp;2006, an increase of $2,390,400, or 9.5%.</font>
</p>
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<font style="opacity:100; position:relative; font-weight: bold; font-style: italic;">Cash Flow</font>
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<font style="opacity:100; position:relative; ">A large portion of our cash is used to pay for materials and processing costs associated with contracts that are in process and which do not provide for progress payments. Contracts that permit us to bill on a progress basis must be classified as &lsquo;&lsquo;on time&rsquo;&rsquo; for us to apply for progress payments. In February&nbsp;2007, we agreed to pay $75,000 to have the late delivery orders on the C-5 TOP contract classified as &lsquo;&lsquo;on time.&rsquo;&rsquo; Accordingly, beginning in February&nbsp;2007, we were able to apply for progress payments under this program. Costs for which we are not able to bill on a progress basis are components of &lsquo;&lsquo;Costs and estimated earnings in excess of billings on uncompleted contracts&rsquo;&rsquo; on our 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.</font>
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<font style="opacity:100; position:relative; ">Because the POC method of accounting requires us to use estimates in determining revenues, costs and profits and in assigning the amounts to accounting periods, there can be a significant disparity between earnings (both for accounting and tax purposes) as reported and actual cash that we receive during any reporting period. Accordingly, it is possible that we may have a shortfall in our cash flow and may need to borrow money until the reported earnings materialize into actual cash receipts.</font>
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<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">12</p>
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<a name="page13"></a><font style="font-family:serif;font-weight:normal;color:#000000;font-size:8pt;  text-align: left; font-style: normal; line-height: 10pt; background-color: #ffffff"><a href="#toc">Table of Contents</a></font>
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<font style="opacity:100; position:relative; ">Item 2 &mdash; Management&rsquo;s Discussion and Analysis of Financial Condition and Results of Operations</font>
<br>
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<font style="opacity:100; position:relative; ">At June&nbsp;30,&nbsp;2007, we had a cash balance of $1,041,745 compared to $38,564 at December&nbsp;31, 2006. In addition to the increase in cash during the six months ended June&nbsp;30,&nbsp;2007, our accounts receivable increased by approximately $334,000, while our liabilities decreased by approximately $70,000. The increase in accounts receivable was primarily due to an increase in amounts due for subcontract work.</font>
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<font style="opacity:100; position:relative; ">During the years ended December&nbsp;31,&nbsp;2006 and 2005, we used cash of $1,015,151 and $676,767, respectively, to fund our operations. Because of our historical use of cash, and the expiration of a long term line of credit, beginning in June&nbsp;2006, we began to reduce expenses and implement a plan to improve cash flow. As described earlier, the reduction of expenses has resulted in improved gross margin and profitability, and as a result, for the six month period ended June&nbsp;30,&nbsp;2007 our operations yielded a positive cash flow of approximately $390,000.</font>
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<font style="opacity:100; position:relative; ">Based on the positive results in the six months ended June&nbsp;30,&nbsp;2007, our projected cash expenses and sources of cash, we expect to have positive cash flow during the twelve month period ending June&nbsp;30,&nbsp;2008.</font>
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<font style="opacity:100; position:relative; ">Credit Facility</font>
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<font style="opacity:100; position:relative; font-weight: bold; font-style: italic;">JP MorganChase</font>
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<font style="opacity:100; position:relative; ">In September&nbsp;2003, we entered into a three year, revolving credit facility with JP Morgan Chase Bank (the &lsquo;&lsquo;Chase Facility&rsquo;&rsquo;), secured by our assets. In August&nbsp;2006, we borrowed $350,000 under the Chase Facility. The Chase Facility was amended and restated in October&nbsp;2006, further amended in May&nbsp;2007 and it expired on June&nbsp;30,&nbsp;2007. All borrowings under this facility were repaid in May&nbsp;2007.</font>
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<font style="opacity:100; position:relative; font-weight: bold; font-style: italic;">Sovereign Bank</font>
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<font style="opacity:100; position:relative; ">In August&nbsp;2007, we entered into a new two-year, $2.5&nbsp;million revolving credit facility with Sovereign Bank (the &lsquo;&lsquo;Sovereign Facility&rsquo;&rsquo;), secured by our assets. The Sovereign Facility specifies an interest rate equal to the lower of LIBOR plus 2% or Sovereign Bank&rsquo;s prime rate. The Sovereign Facility contains financial covenants related to interest coverage, net income and capital expenditures, as defined in the agreement.</font>
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<font style="opacity:100; position:relative; ">We believe that our existing resources, together with the availability under our credit facility, will be sufficient to meet our current working capital needs for at least the next 12 months.</font>
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<font style="opacity:100; position:relative; ">Contractual Obligations</font>
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<font style="opacity:100; position:relative; ">The table below summarizes information about our contractual obligations as of June&nbsp;30,&nbsp;2007 and the effects these obligations are expected to have on our liquidity and cash flow in the future years.</font>
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<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1" rowspan="2"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Contractual Obligations</font></font></td>
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<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="28"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Payments Due By Period ($)</font></font></td>
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<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Total</font></font></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Less than 1 year</font></font></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">1-3 years</font></font></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">4-5 years</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 8pt; line-height:10pt; color: #000000; border-bottom: 1px solid #000000;padding-top: 0pt; background-color: #ffffff;	" align="center" valign="bottom" colspan="4"><font style="font-family: serif; font-size: 8pt; line-height:10pt; color: #000000; font-weight: bold; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">After 5 years</font></font></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Short-Term Debt</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">14,215</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">14,215</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
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<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
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<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">-0-</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">-0-</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Operating Leases</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">3,338,786</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">403,805</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">844,316</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">895,735</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,194,930</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #cceeff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #cceeff;"><font style="opacity:100; position:relative; ">Employment Agreement Compensation*</font></font></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,560,875</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">670,575</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">770,300</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">120,000</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #cceeff;border-bottom: 1px solid #cceeff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">-0-</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #cceeff;padding-top: 0pt; background-color: #cceeff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
<tr>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 10pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="bottom" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Total Contractual Cash Obligations</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">4,913,876</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,088,595</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,614,616</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,015,735</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff;"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal;" align="right" valign="bottom"><img src="spacer.gif" width="1"></td>
<td align="right" style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff;font-weight: normal; font-style: normal; " valign="bottom"><font style="opacity:100; position:relative; ">1,194,930</font></td>
<td style="font-size: 10pt;  line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-top: 0pt; background-color: #ffffff; font-weight: normal; font-style: normal; " valign="bottom" align="left"><img src="spacer.gif" width="1"></td>
</tr>
</table>
</div>
</div>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-bottom: 6pt;   width: 18pt; padding-left: 0pt;"><font style="opacity:100; position:relative; ">*</font></td>
<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-bottom: 6pt;   width: pt; "><font style="opacity:100; position:relative; ">The employment agreements provide for bonus payments that are excluded from these amounts.</font></td>
</tr>
</table>
<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>
<a name="page14"></a><font style="font-family:serif;font-weight:normal;color:#000000;font-size:8pt;  text-align: left; font-style: normal; line-height: 10pt; background-color: #ffffff"><a href="#toc">Table of Contents</a></font>
<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;">
<font style="opacity:100; position:relative; ">Item 3 &mdash; Quantitative and Qualitative Disclosure About Market Risk</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: 20pt; background-color: #ffffff">
<font style="opacity:100; position:relative; ">None</font>
</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;">
<font style="opacity:100; position:relative; ">Item 4 &mdash; Controls and Procedures</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: 20pt; background-color: #ffffff">
<font style="opacity:100; position:relative; ">An evaluation of the effectiveness of our disclosure controls and procedures was made as of June&nbsp;30,&nbsp;2007 under the supervision and with the participation of our management, including our chief executive officer and chief financial officer. During the first quarter of 2007, we implemented a plan to remediate the material weaknesses identified by our independent registered public accounting firm and discussed in detail in our Annual Report on Form 10-K for the year ended December&nbsp;31,&nbsp;2006. These material weaknesses related to our failure to properly recognize revenue, cost incurred and billings to the customer on certain contracts in that:</font>
</p>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="552"></td>
</tr>
<tr>
<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; font-style: normal; width: 20pt;"></td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; padding-bottom: 3pt; text-align: left; font-style: normal; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">&bull;</font>&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; padding-bottom: 3pt; text-align: left; font-style: normal; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">the sales and cost estimates used to recognize revenue on a significant contract did not reflect the most current available information. As a result, the 2006 margin with respect to this contract was overstated; and</font></td>
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<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; font-style: normal; width: 20pt;"></td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; padding-bottom: 3pt; text-align: left; font-style: normal; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">&bull;</font>&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; padding-bottom: 3pt; text-align: left; font-style: normal; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">gross margin was overstated on certain contracts because we recognized revenue on change orders where the customer approval had not been obtained.</font></td>
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<font style="opacity:100; position:relative; ">These two errors resulted in an overstatement of net income in our statement of operations for the year ended December&nbsp;31,&nbsp;2006, which were corrected prior to filing of our Annual Report on Form 10-K.</font>
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<font style="opacity:100; position:relative; ">Our internal control over reviewing and recording revenue recognition did not detect these matters and therefore was not effective at preventing or detecting material misstatement of the financial statements. Although we have begun remediation of these deficiencies, we have not had sufficient time to test whether these actions will be effective.</font>
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<font style="opacity:100; position:relative; ">To remediate these material weaknesses, during the first quarter of 2007, our senior management implemented a new procedure requiring our chief financial officer and vice president of operations to review sales and cost estimates used to recognize revenue subsequent to the preparation of the financial statements to insure that such estimates used the most current available information. In addition, a procedure was designed to insure that all change orders have customer approval before being reflected in our contract estimates.</font>
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<font style="opacity:100; position:relative; ">In addition, during the second quarter of 2007 we began to take the following corrective actions:</font>
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<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; font-style: normal; width: 20pt;"></td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; padding-bottom: 3pt; text-align: left; font-style: normal; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">&bull;</font>&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; padding-bottom: 3pt; text-align: left; font-style: normal; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">We added resources to our accounting department to manage the estimating process necessary to properly and timely report our revenue.</font></td>
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<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; padding-bottom: 3pt; text-align: left; font-style: normal; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">&bull;</font>&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 3pt; padding-bottom: 3pt; text-align: left; font-style: normal; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">We started planning a regular education program for additional members of our accounting department to diversify the task of financial reporting management and allow a higher level of review.</font></td>
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<font style="opacity:100; position:relative; ">Because we have not completed our remediation plan, our chief executive officer and chief financial officer have concluded that our disclosure controls and procedures were not effective as of June&nbsp;30,&nbsp;2007 to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission&rsquo;s rules and forms, and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding disclosure.</font>
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<font style="opacity:100; position:relative; ">During the most recently completed fiscal quarter, except as described above, there has been no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.</font>
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<font style="opacity:100; position:relative; ">.</font>
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<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">14</p>
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<a name="page15"></a><font style="font-family:serif;font-weight:normal;color:#000000;font-size:8pt;  text-align: left; font-style: normal; line-height: 10pt; background-color: #ffffff"><a href="#toc">Table of Contents</a></font>
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<font style="opacity:100; position:relative; ">Part II:&nbsp;&nbsp;&nbsp;&nbsp;Other Information</font>
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<font style="opacity:100; position:relative; ">Item 1A &mdash; Risk Factors</font>
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<font style="opacity:100; position:relative; ">There are no material changes from the risk factors set forth in Item 1A, &lsquo;&lsquo;Risk Factors,&rsquo;&rsquo; of our Annual Report on Form 10-K for the year ended December&nbsp;31,&nbsp;2006. Please refer to that section for disclosures regarding the risks and uncertainties to our business.</font>
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<font style="opacity:100; position:relative; ">Item 4 &mdash; Submission of Matters to a Vote of Security Holders</font>
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<font style="opacity:100; position:relative; ">We held our Annual Meeting of Shareholders on June&nbsp;12,&nbsp;2007. At the meeting, the director nominated for election, Edward J. Fred, was reelected for a three-year term expiring in 2010, with 5,194,460 shares voted in favor of his election and 59,105 shares for which authority was withheld. The terms of office of Kenneth McSweeney and Harvey J. Bazaar will expire at the Annual Meeting of Shareholders to be held in 2008. The terms of office of Walter Paulick and Eric Rosenfeld will expire at the Annual Meeting of Shareholders to be held in 2009.</font>
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<font style="opacity:100; position:relative; ">Item 6 &mdash; Exhibits</font>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Exhibit 10.27</font></font></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Credit Agreement between CPI Aerostructures, Inc., and Sovereign Bank, dated as of August 13, 2007</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom:  1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Exhibit 10.28</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Commercial Security Agreement, dated August 13, 2007, between CPI</font>
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<font style="opacity:100; position:relative; ">Aerostructures, Inc., Grantor, and Sovereign Bank, Lender</font></font></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom:  1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Exhibit 31.1</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Section 302 Certification by Chief Executive Officer</font></font></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom:  1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Exhibit 31.2</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Section 302 Certification by Chief Financial Officer</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 30pt; text-indent: -10pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Exhibit 32</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Section 906 Certification by Chief Executive Officer and Chief Financial Officer</font></font></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom:  1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
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<font style="opacity:100; position:relative; ">SIGNATURES</font>
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<font style="opacity:100; position:relative; ">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.</font>
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<td><img src="spacer.gif" height="1" width="281"></td>
</tr>
<tr>
<td style="font-size: 9pt; line-height:11pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 9pt; line-height:11pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 9pt; line-height:11pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="4"><font style="font-family: serif; font-size: 9pt; line-height:11pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">CPI AEROSTRUCTURES, INC.</font></font></td>
</tr>
<tr>
<td style="font-size: 9pt; line-height:11pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 32pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 9pt; line-height:11pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Dated: August&nbsp;14,&nbsp;2007</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 9pt; line-height:11pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 32pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 9pt; line-height:11pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">By:</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 9pt; line-height:11pt; color: #000000; border-bottom: 1px solid #000000;padding-left: 0pt; text-indent: 0pt; padding-top: 32pt; background-color: #ffffff;	" align="center" valign="top" colspan="1"><font style="font-family: serif; font-size: 9pt; line-height:11pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">/S/ Edward J. Fred</font></font></td>
</tr>
<tr>
<td style="font-size: 9pt; line-height:11pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 9pt; line-height:11pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 9pt; line-height:11pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 9pt; line-height:11pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 9pt; line-height:11pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="center" valign="top" colspan="1"><font style="font-family: serif; font-size: 9pt; line-height:11pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Edward J. Fred</font>
<br>
<font style="opacity:100; position:relative; ">Chief Executive Officer, President, and Secretary </font></font></td>
</tr>
<tr>
<td style="font-size: 9pt; line-height:11pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 32pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 9pt; line-height:11pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Dated: August&nbsp;14,&nbsp;2007</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 9pt; line-height:11pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 32pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 9pt; line-height:11pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">By:</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 9pt; line-height:11pt; color: #000000; border-bottom: 1px solid #000000;padding-left: 0pt; text-indent: 0pt; padding-top: 32pt; background-color: #ffffff;	" align="center" valign="top" colspan="1"><font style="font-family: serif; font-size: 9pt; line-height:11pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">/S/ Vincent Palazzolo</font></font></td>
</tr>
<tr>
<td style="font-size: 9pt; line-height:11pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 9pt; line-height:11pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 9pt; line-height:11pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 9pt; line-height:11pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 9pt; line-height:11pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="center" valign="top" colspan="1"><font style="font-family: serif; font-size: 9pt; line-height:11pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Vincent Palazzolo</font>
<br>
<font style="opacity:100; position:relative; ">Chief Financial Officer</font></font></td>
</tr>
</table>
</div>
</div>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">16</p>
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<hr width="760" style="padding-left: 0pt;" align="left">
<br>



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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.27
<SEQUENCE>2
<FILENAME>file2.htm
<DESCRIPTION>CREDIT AGREEMENT
<TEXT>
<HTML>
<HEAD>
<TITLE>
</TITLE>
</HEAD>
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  <PAGE>
	 <P STYLE=" margin-bottom:0pt; margin-top:16pt;text-align:center;">
		<B><FONT STYLE="FONT-SIZE:10PT">CREDIT AGREEMENT</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:16pt;text-align:center;">
		<B><FONT STYLE="FONT-SIZE:10PT">BETWEEN</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:16pt;text-align:center;">
		<B><FONT STYLE="FONT-SIZE:10PT">CPI AEROSTRUCTURES, INC. <BR>(the
		&#147;Borrower&#148;)</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:16pt;text-align:center;">
		<B><FONT STYLE="FONT-SIZE:10PT">AND</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:16pt;text-align:center;">
		<B><FONT STYLE="FONT-SIZE:10PT">SOVEREIGN BANK</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<B><FONT STYLE="font-size:10pt">(the &#147;Bank&#148;)</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:16pt;text-align:center;">
		<B><FONT STYLE="FONT-SIZE:10PT">DATED AS OF AUGUST 13, 2007</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
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	 SIZE="2"><PAGE>
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	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">CREDIT AGREEMENT dated as of August 13,
		2007, between CPI AEROSTRUCTURES, INC., a New York corporation, with an office
		at 60 Heartland Boulevard, Edgewood, New York 11717 (the &#147;Borrower&#148;),
		and SOVEREIGN BANK, a New York bank, with an office at 3 Huntington Quadrangle,
		Melville, New York 11747 (the &#147;Bank&#148;).</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">The parties hereto hereby agree as
		follows:</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:center;">
		<FONT STYLE="FONT-SIZE:10PT">SECTION 1. </FONT><U><FONT
		STYLE="FONT-SIZE:10PT">DEFINITIONS</FONT></U>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">1.1 </FONT><U><FONT
		STYLE="font-size:10pt">Defined Terms</FONT></U><FONT STYLE="font-size:10pt">.
		As used herein the following terms shall have the following meanings:</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Affiliate</FONT></U><FONT STYLE="font-size:10pt">&#148;
		as applied to any Person, means any other Person directly or indirectly through
		one or more intermediaries controlling, controlled by, or under common control
		with, that Person. For the purposes of this definition, &#147;control&#148;
		(including with correlative meanings, the terms &#147;controlling&#148;,
		&#147;controlled by&#148; and &#147;under common control with&#148;), as
		applied to any Person, means the possession, directly or indirectly, of the
		power to direct or cause the direction of the management and policies of that
		Person, whether through the ownership of voting securities or by contract or
		otherwise.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Agreement</FONT></U><FONT STYLE="font-size:10pt">&#148;
		shall mean this Credit Agreement, as the same from time to time may be amended,
		supplemented or modified.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Business Day</FONT></U><FONT
		STYLE="font-size:10pt">&#148; or &#147;</FONT><U><FONT
		STYLE="font-size:10pt">Banking Day</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean, with respect to Libor Rate Loans, a
		London Banking Day and, with respect to Prime Rate Loans and in all other
		cases, any day other than a day on which commercial banks in New York are
		required or permitted by law to close.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Capital Expenditures</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean, for any period, the aggregate amount
		of all payments made by any Person directly or indirectly for the purpose of
		acquiring, constructing or maintaining fixed assets, real property or
		equipment, which, in accordance with GAAP, would be added as a debit to the
		fixed asset account of such Person, including, without limitation, all amounts
		paid or payable with respect to capitalized lease obligations and interest
		which are required to be capitalized in accordance with GAAP.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Commitment</FONT></U><FONT STYLE="font-size:10pt">&#148;
		shall mean the obligation of the Bank to make Revolving Credit Loans to the
		Borrower during the Commitment Period pursuant to the terms hereof as such
		Commitment is described in Section 2.1 hereof and is subject to reduction in
		accordance with the terms hereof.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Commitment Period</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean the period from and including the date
		hereof to and including the Termination Date or such earlier date as the
		Commitment shall terminate as provided herein.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Cleanup Laws</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean any Federal, state or local statute or
		regulation relating to hazardous or toxic wastes or substances or the removal
		thereof.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 SIZE="2"><PAGE>
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	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Contractual Obligations</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean, as to any Person, any provision of
		any security issued by such Person or of any agreement, instrument or
		undertaking to which such Person is a party or by which it or any of its
		property is bound.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Control</FONT></U><FONT STYLE="font-size:10pt">&#148;
		means the possession, directly or indirectly, of the power to direct or cause
		the direction of the management or policies of a Person, whether through the
		ability to exercise majority voting power, by contract or otherwise.
		&#147;Controlling&#148; and &#147;Controlled&#148; have meanings correlative
		thereto.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Default</FONT></U><FONT STYLE="font-size:10pt">&#148;
		shall mean any of the events specified in Section 8 hereof, whether or not any
		requirement for the giving of notice, the lapse of time, or both, has been
		satisfied.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Dollars</FONT></U><FONT STYLE="font-size:10pt">&#148; or
		&#147;$&#148; shall mean dollars in lawful currency of the United States of
		America.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Environmental Laws</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean any Federal, state or local statute or
		regulation relating to hazardous or toxic wastes or substances or the removal
		thereof.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="FONT-SIZE:10PT">ERISA</FONT></U><FONT STYLE="font-size:10pt">&#148;
		shall mean the Employee Retirement Income Security Act of 1974, as amended from
		time to time.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Event of Default</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean any of the events specified in Section
		8 hereof, provided that any requirement for the giving of notice, the lapse of
		time, or both, or any other condition, has been satisfied.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="FONT-SIZE:10PT">GAAP</FONT></U><FONT STYLE="font-size:10pt">&#148; shall
		mean generally accepted accounting principles in the United States applied in a
		manner consistent with that employed in the preparation of the financial
		statements described in Section 3.1.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Governmental Authority</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean any nation or government, any state or
		other political subdivision thereof, any entity exercising executive,
		legislative, judicial, regulatory or administrative functions of or pertaining
		to government, and any corporation or other entity owned or controlled (through
		stock or capital ownership or otherwise) by any of the foregoing.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><FONT
		STYLE="font-size:10pt"><U>Guaranty</U>&#148; or
		&#147;<U>Guaranties</U></FONT><FONT STYLE="font-size:10pt">&#148; shall mean
		the guaranty or guaranties executed by the Guarantors on the Bank&#146;s
		standard form.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Guarantors</FONT></U><FONT STYLE="font-size:10pt">&#148;
		shall mean any Person or Persons who guarantee the payment and performance of
		the Borrower&#146;s indebtedness and obligations (including the Obligations)
		hereunder, including (without limitation) all Persons required to guarantee
		pursuant to Section 5.9 hereof.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Indebtedness</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean, with respect to any Person, (a) all
		obligations of such Person for borrowed money or with respect to deposits or
		advances of any kind, (b) all obligations of such Person evidenced by bonds,
		debentures, notes or other similar instruments, (c) all obligations of such
		Person for the deferred purchase price of property or services, except current
		accounts payable</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:12pt">-</FONT><FONT
		STYLE="font-size:10pt">2</FONT><FONT STYLE="font-size:12pt">-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">arising in the ordinary course of business
		and not overdue beyond such period as is commercially reasonable for such
		Person&#146;s business, (d) all obligations of such Person under conditional
		sale or other title retention agreements relating to property purchased by such
		Person, (e) all payment obligations of such Person with respect to interest
		rate or currency protection agreements, (f) all obligations of such Person as
		an account party under any letter of credit or in respect of bankers
		acceptances, (g) all obligations of any third party secured by property or
		assets of such Person (regardless of whether or not such Person is liable for
		repayment of such obligations), (h) all guarantees of such Person and (i) the
		redemption price of all redeemable preferred stock of such Person, but only to
		the extent that such stock is redeemable at the option of the holder or
		requires sinking fund or similar payments at any time prior to the Termination
		Date.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Intellectual Property</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean the collective reference to all
		rights, provisions and privileges relating to intellectual property, whether
		arising under United States, multinational, or foreign laws or otherwise,
		including, without limitation, copyrights, copyright licenses, patents, patent
		licenses, trademarks, trademark licenses, technology, know-how and processes,
		and all rights to sue at law or in equity for any infringement or other
		impairment thereof, including the right to receive all proceeds and damages
		therefrom.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Interest Expense</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean, with respect to the Borrower and its
		Subsidiaries for the applicable period of determination thereof, the interest
		expense of the Borrower and its Subsidiaries during such period determined on a
		consolidated basis in accordance with GAAP, and shall in any event include
		without limitation, (i) the amortization of debt discounts, (ii) the
		amortization of all fees payable in connection with the incurrence of
		Indebtedness to the extent included in interest expense, and (iii) the portion
		of any capitalized lease obligation allocable to interest expense.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Interest Period</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean any period during which a Revolving
		Credit Loan bears interest at a Libor Rate as elected by the Borrower in
		accordance with the terms of this Agreement.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(a) If any Interest Period would otherwise
		end on a day which is not a Business Day, that Interest Period shall be
		extended to the next succeeding Business Day unless the result of such
		extension would be to extend such Interest Period into another calendar month,
		in which event such Interest Period shall end on the immediately preceding
		Business Day.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(b) No Interest Period shall extend beyond
		the Termination Date.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Libor Rate Loan</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean Revolving Credit Loans hereunder (or
		any portion of the outstanding principal balance thereof) that bear interest
		for the Interest Period applicable thereto at a rate of interest based upon the
		Libor Rate plus the applicable margin.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Libor Rate</FONT></U><FONT STYLE="font-size:10pt">&#148;
		shall mean as applicable to any Libor Rate Loan and Interest Period applicable
		thereto, (i) a rate per annum (rounded upward, if necessary, to the nearest
		1/32 of one percent) equal to the composite London Interbank Offered Rate which
		appears on the Telerate page 3750 as of 11:00 a.m. London time on the day that
		is two (2) London Banking Days preceding the first day of such Interest Period
		(or if not reported thereon, then as determined by the Bank from another
		recognized source or interbank quotation). In the event that the Board of
		Governors of the</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:12pt">-</FONT><FONT
		STYLE="font-size:10pt">3</FONT><FONT STYLE="font-size:12pt">-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
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	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">Federal Reserve System shall impose a
		Reserve Percentage with respect to Libor deposits of the Bank, then for any
		period during which such Reserve Percentage shall apply, Libor shall be equal
		to the amount determined above divided by an amount equal to 1 minus the
		Reserve Percentage. &#147;Reserve Percentage&#148; shall mean the maximum
		aggregate reserve requirement (including all basic, supplemental, marginal and
		other reserves) which is imposed on member banks of the Federal Reserve System
		against &#147;Euro-currency Liabilities&#148; as defined in Regulation D.
		</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Lien</FONT></U><FONT STYLE="font-size:10pt">&#148; shall
		mean any mortgage, pledge, security interest, hypothecation, assignment,
		deposit arrangement, encumbrance, or preference, priority or other security
		agreement or preferential arrangement of any kind or nature whatsoever
		(including, without limitation, any conditional sale or other title retention
		agreement, any financing lease having substantially the same economic effect as
		any of the foregoing, and the filing of any financing statement under the
		Uniform Commercial Code or comparable law of any jurisdiction).</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Loan Documents</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean, collectively, this Agreement, the
		Revolving Credit Note, the Security Agreement, the Additional Documents (as
		defined in Section 10.14 hereof), the Replacement Documents (as defined in
		Section 10.15 hereof) and each document, agreement and instrument executed in
		connection herewith or pursuant hereto together with each document, agreement
		and instrument made by the Borrower or any Guarantor with or in favor of or
		owing to the Bank.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">London Banking Day</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean, with respect to Libor Rate Loans, any
		day on which commercial banks are open for international business (including
		dealing in U.S. Dollar ($) deposits) in London, England and New York.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Obligations</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall have the meaning set forth in Section
		9.1.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Person</FONT></U><FONT STYLE="font-size:10pt">&#148;
		shall mean any individual, corporation, partnership, joint venture, trust,
		unincorporated organization or any juridical entity, or a government or state
		or any agency or political subdivision thereof.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Plan</FONT></U><FONT STYLE="font-size:10pt">&#148; shall
		mean any plan described in Section 4021(a) of ERISA in respect of which the
		Borrower is an &#147;employer&#148; as defined in Section 3(5) of ERISA.</FONT>

	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Post Default Rate</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean at any time a rate of interest equal
		to four (4%) percent per annum in excess of the rate that would then be
		applicable to the Revolving Credit Loans.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Prime Rate</FONT></U><FONT STYLE="font-size:10pt">&#148;
		shall mean the rate per annum from time to time established by the Bank as the
		Prime Rate and made available by the Bank at its main office or, in the
		discretion of the Bank, the base, reference or other rate then designated by
		the Bank for general commercial loan reference purposes, it being understood
		that such rate is a reference rate, not necessarily the lowest, established
		from time to time, which serves as the basis upon which effective interest
		rates are calculated for loans making reference thereto (the
		&#147;Index&#148;). The Index is not necessarily the lowest rate charged by the
		Bank on its loans and is set by the Bank in its sole discretion. If the Index
		becomes unavailable during the term of this Agreement, the Bank may designate a
		substitute index after notifying the Borrower. The Bank will tell the Borrower
		the current Index rate upon the</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:12pt">-</FONT><FONT
		STYLE="font-size:10pt">4</FONT><FONT STYLE="font-size:12pt">-</FONT>
	 </P>
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	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">Borrower&#146;s request. The interest rate
		change will not occur more often than each time as and when the Index
		changes.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Prime Rate Loan</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean Revolving Credit Loans hereunder (or
		any portion of the outstanding principal balance thereof) which bear interest
		based upon the Prime Rate.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Real Property</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean any real property owned or leased by
		any Specified Person.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Reportable Event</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean any of the events set forth in Section
		4043(b) of ERISA or the regulations thereunder.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Requirements of Law</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean, as to any Person, the certificate of
		incorporation and by-laws or other organizational or governing documents of
		such Person, and any law, treaty, rule or regulation, or determination of any
		arbitrator or a court or other Governmental Authority, in each case applicable
		to or binding upon such Person or any of its property or to which such Person
		or any of its property is subject.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Revolving Credit Loan</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean a loan made pursuant to Section 2.1
		hereof.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Revolving Credit Note</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean the note referred to in Section 2.2
		hereof.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Security Agreement</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean the security agreement referred to in
		Section 4.1(b) hereof.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Specified Person</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean the Borrower, any Guarantor, any
		Subsidiaries of the Borrower or any Guarantor, or the Subsidiaries of any of
		their Subsidiaries.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Subordination Agreement</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean the Subordination Agreement by the
		Borrower and the Bank in favor of the United States of America of even date
		herewith.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Subsidiary</FONT></U><FONT STYLE="font-size:10pt">&#148;
		or &#147;</FONT><U><FONT STYLE="font-size:10pt">Subsidiaries</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean, with respect to any Person (the
		&#147;parent&#148;) at any date, any corporation, limited liability company,
		partnership, association or other entity the accounts of which would be
		consolidated with those of the parent in the parent&#146;s consolidated
		financial statements if such financial statements were prepared in accordance
		with GAAP as of such date, as well as any other corporation, limited liability
		company, partnership, association or other entity of which securities or other
		ownership interests representing more than 50% of the equity or more than 50%
		of the ordinary voting power or, in the case of a partnership, more than 50% of
		the partnership interests are, as of such date, owned, controlled or held,
		directly or indirectly, by the parent.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">&#147;</FONT><U><FONT
		STYLE="font-size:10pt">Termination Date</FONT></U><FONT
		STYLE="font-size:10pt">&#148; shall mean August 13, 2009 or, if such date is
		not a Business Day, the Business Day next succeeding such date.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:12pt">-</FONT><FONT
		STYLE="font-size:10pt">5</FONT><FONT STYLE="font-size:12pt">-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
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	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">1.2 </FONT><U><FONT
		STYLE="font-size:10pt">Accounting Terms</FONT></U><FONT
		STYLE="font-size:10pt">. As used herein and in any certificate or other
		document made or delivered pursuant hereto, accounting terms not specifically
		defined herein shall have the respective meanings given to them under
		GAAP.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:center;">
		<FONT STYLE="FONT-SIZE:10PT">SECTION 2.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<U><FONT STYLE="FONT-SIZE:10PT">AMOUNT AND TERMS OF REVOLVING CREDIT
		COMMITMENT</FONT></U>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">2.1 </FONT><U><FONT
		STYLE="font-size:10pt">Revolving Credit Commitment</FONT></U><FONT
		STYLE="font-size:10pt">. Subject to the terms and conditions hereof, the Bank
		agrees to make revolving credit loans to the Borrower (collectively, the
		&#147;Revolving Credit Loans&#148;) from time to time during the Commitment
		Period in the aggregate principal amount at any one time outstanding of up to
		(but not exceeding) $2,500,000.00, as such maximum available amount may be
		hereafter reduced as provided in this Agreement (the &#147;Commitment&#148;).
		During the Commitment Period, the Borrower may use the Commitment for obtaining
		Revolving Credit Loans by borrowing, paying, prepaying in whole or in part and
		reborrowing on a revolving basis, all in accordance with the terms and
		conditions hereof provided that no more than three (3) types of Libor Rate
		Loans may be outstanding at any time.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">2.2 </FONT><U><FONT
		STYLE="font-size:10pt">Revolving Credit Note</FONT></U><FONT
		STYLE="font-size:10pt">. The Revolving Credit Loans made by the Bank to the
		Borrower pursuant to Section 2.1 hereof shall be evidenced by a promissory note
		of the Borrower substantially in the form of Exhibit A hereto with appropriate
		insertions (the &#147;Revolving Credit Note&#148;), payable to the order of the
		Bank and representing the obligation of the Borrower to pay the lesser of (a)
		the amount of the Commitment, or (b) the aggregate unpaid principal amount of
		all Revolving Credit Loans made by the Bank to the Borrower, with interest
		thereon as hereinafter prescribed. The Revolving Credit Note shall (i) be dated
		the date hereof, (ii) be stated to mature on the Termination Date and (iii)
		bear interest with respect to the unpaid principal balance thereof from time to
		time outstanding at a rate per annum to be elected by the Borrower in
		accordance with the notice provisions set forth in Section 2.3 hereof, and, in
		the case of Libor Rate Loans, for the Interest Period therein specified, equal
		to (y) 2.0% in excess of the Libor Rate, or (z) the Prime Rate. All
		computations of interest under this Agreement shall be made on the basis of a
		three hundred sixty (360) day year and the actual number of days elapsed. In
		all cases, interest shall be payable as provided in Section 2.9(a) hereof,
		subject to Section 10.13 hereof. After any stated or accelerated maturity, the
		Revolving Credit Note shall bear interest at the rate set forth in Section
		2.9(c) hereof, subject to Section 10.13 hereof.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">2.3 </FONT><U><FONT
		STYLE="font-size:10pt">Procedure for Borrowing</FONT></U><FONT
		STYLE="font-size:10pt">. The Borrower may borrow under the Commitment during
		the Commitment Period on any Business Day by giving the Bank irrevocable
		written notice of a request for a Revolving Credit Loan hereunder (a) in the
		case of Libor Rate Loans, three (3) Business Days before a proposed borrowing
		or continuation or conversion and (b) in the case of all other Revolving Credit
		Loans, not less than one (1) nor more than five (5) Business Days before a
		proposed borrowing or continuation or conversion, setting forth (i) the amount
		of the loan request, which shall not be less than $100,000.00, (ii) the
		requested borrowing date or Interest Period commencement date, as the case may
		be, (iii) whether the borrowing or Interest Period is to be for a Libor Rate
		Loan or a Prime Rate Loan or a combination thereof, and (iv) if entirely or
		partially a Libor Rate Loan, the length of the Interest Period therefor, which
		shall be one (1), two (2), three (3), four (4), five (5) or six (6) months. As
		used in this Section 2.3, &#147;conversion&#148; shall mean the conversion from
		one interest rate to another interest rate as more fully described in Section
		2.7 </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:12pt">-</FONT><FONT
		STYLE="font-size:10pt">6</FONT><FONT STYLE="font-size:12pt">-</FONT>
	 </P>
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	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">hereof. Such notice shall be written
		(including, without limitation, via facsimile transmission) and shall be
		sufficient if received by 1:00 p.m. on the date on which such notice is to be
		given. If any such request is sent by facsimile it shall be confirmed in
		writing sent by the Borrower to the Bank within two (2) Business Days
		thereafter. Unless notification is otherwise furnished by the Borrower to the
		Bank (in a manner consistent with the requirements of this Section 2.3),
		Revolving Credit Loans will be made by credits to the Borrower&#146;s demand
		deposit account maintained with the Bank. If the Borrower furnishes such notice
		but no election is made as to the type of loan or the Interest Period to be
		applicable thereto, the Revolving Credit Loan will automatically then be made
		as a Prime Rate Loan until such required information is furnished pursuant to
		the terms hereof.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">2.4 </FONT><U><FONT
		STYLE="font-size:10pt">Commitment Fee</FONT></U><FONT STYLE="font-size:10pt">.
		As additional compensation for the Commitment on the revolving basis provided
		for herein, the Borrower agrees to pay the Bank a commitment fee for the
		Commitment Period at the rate of .25% per annum on the average daily unused
		portion of the Commitment hereunder. Such commitment fee shall be payable
		quarterly, on the last day of each March, June, September and December during
		the Commitment Period, commencing September 30, 2007, and on the Termination
		Date. If the Borrower so fails to pay any such amount to the Bank the
		obligations to make such payment shall bear interest from such date not paid
		when due at the Post Default Rate. The obligation to so pay interest shall not
		be construed so as to waive the requirement to pay the commitment fees as
		hereinabove set forth.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">2.5 </FONT><U><FONT
		STYLE="font-size:10pt">Regulatory Changes</FONT></U><FONT
		STYLE="font-size:10pt"> in Capital Requirements. If, after the date hereof, the
		Bank reasonably determines that (i) the adoption of a change in law, rule,
		regulation or guideline regarding capital requirements for banks or bank
		holding companies, or any change in the interpretation or application thereof
		by any Governmental Authority charged with the administration thereof, or (ii)
		compliance by the Bank or its parent bank holding company with any guideline,
		request, or directive of any such entity regarding capital adequacy (whether or
		not having the force of law), the effect of reducing the return on the
		Bank&#146;s or such holding company&#146;s capital as a consequence of the
		Bank&#146;s Commitment hereunder to a level below that which the Bank or such
		holding company could have achieved but for such adoption, change or compliance
		(taking into consideration the Bank&#146;s or such holding company&#146;s then
		existing policies with respect to capital adequacy and assuming the full
		utilization of such entity&#146;s capital) by any amount deemed by the Bank to
		be material, then the Bank may notify the Borrower thereof. Following receipt
		of such notice, the Borrower agrees to pay the Bank on demand the amount of
		such reduction of return on capital as and when such reduction is determined,
		payable within ninety (90) days after presentation by the Bank of a statement
		in the amount and setting forth in reasonable detail the Bank&#146;s
		calculation thereof and the assumptions upon which such calculation was based
		(which statement shall be deemed true and correct absent manifest error). In
		determining such amount, the Bank may use any reasonable averaging and
		attribution methods.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">2.6 </FONT><U><FONT
		STYLE="font-size:10pt">Termination or Reduction of Commitment</FONT></U><FONT
		STYLE="font-size:10pt">. The Borrower shall have the right, upon not less than
		three (3) Business Days&#146; irrevocable written notice, to terminate the
		Commitment or, from time to time, to reduce the amount of the Commitment,
		provided that (a) any such reduction (i) shall be in the minimum amount of
		$100,000.00 or a multiple thereof, (ii) shall reduce permanently the amount of
		the Commitment then in effect, and (iii) shall be accompanied by prepayment of
		the Revolving Credit Loans outstanding to the extent, if any, that the
		aggregate of the Revolving Credit Loans then outstanding exceed the amount of
		the Commitment as then reduced, together with </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:12pt">-</FONT><FONT
		STYLE="font-size:10pt">7</FONT><FONT STYLE="font-size:12pt">-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
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	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">accrued interest on the amount so prepaid to
		and including the dates of each such prepayment and any amounts payable
		pursuant to Section 2.12 in connection therewith and the payment of any unpaid
		commitment fee then accrued hereunder; and (b) any such termination of the
		Commitment shall be accompanied by prepayment in full of the Revolving Credit
		Loans outstanding (together with accrued interest thereon to and including the
		date of prepayment) the payment of any amounts payable pursuant to Section 2.12
		in connection therewith and the payment of any unpaid commitment fee then
		accrued hereunder.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">2.7 </FONT><U><FONT
		STYLE="font-size:10pt">Continuation and Conversion of Loans</FONT></U><FONT
		STYLE="font-size:10pt">. The Borrower shall have the right at any time on prior
		irrevocable written or facsimile notice to the Bank as specified in Section
		2.3: (i) to continue any Revolving Credit Loan into a subsequent Interest
		Period, (ii) to convert any Loan into another type of Loan (specifying, in the
		case of a Libor Rate Loan, the Interest Period to be applicable thereto), and
		(iii) to convert any Prime Rate Loan into a Libor Rate Loan (specifying the
		Interest Period to be applicable thereto), subject to the following:</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(a) in the case of a conversion of less than
		all of the outstanding Revolving Credit Loans, the aggregate principal amount
		of Revolving Credit Loans converted shall not be less than $100,000.00 and
		shall be an integral multiple thereof;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(b) no Revolving Credit Loan (other than a
		Prime Rate Loan) shall be converted at any time other than at the end of an
		Interest Period applicable thereto;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(c) any portion of a Revolving Credit Loan
		maturing or required to be prepaid in less than one month may not be converted
		into or continued as a Libor Rate Loan; and</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(d) no more than three (3) types of Libor
		Rate Loans may be outstanding at any one time.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">In the event that the Borrower shall not
		give notice to continue any Libor Rate Loan into a subsequent Interest Period
		or convert any such Revolving Credit Loan, into a Revolving Credit Loan of
		another type, on the last day of the Interest Period thereof, such Revolving
		Credit Loan (unless prepaid) shall automatically be converted into a Prime Rate
		Loan. The Interest Period applicable to any Libor Rate Loan resulting from a
		conversion or continuation shall be specified by the Borrower in the
		irrevocable notice delivered by the Borrower pursuant to this Section and
		Section 2.3; provided, however, that, if such notice does not specify either
		the type of loan or the Interest Period to be applicable thereto, the Revolving
		Credit Loan shall automatically be converted into, or continued as, as the case
		may be, a Prime Rate Loan until such required information is furnished pursuant
		to the terms hereof. Notwithstanding anything to the contrary contained above,
		if an Event of Default shall have occurred and is continuing, no Libor Rate
		Loan may be continued into a subsequent Interest Period and no Prime Rate Loan
		may be converted into a Libor Rate Loan.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">2.8 </FONT><U><FONT
		STYLE="font-size:10pt">Prepayment</FONT></U><FONT
		STYLE="font-size:10pt">.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(a) </FONT><U><FONT
		STYLE="font-size:10pt">Voluntary</FONT></U><FONT STYLE="font-size:10pt">. The
		Borrower may prepay any Prime Rate Loan in whole or in part without premium or
		penalty; provided, however, that each partial prepayment on account of any
		Prime Rate Loan shall be in an amount not less than $50,000.00. Except as
		provided in Section </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:12pt">-</FONT><FONT
		STYLE="font-size:10pt">8</FONT><FONT STYLE="font-size:12pt">-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
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	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">2.8(b) or in connection with a termination
		or reduction of the Commitment pursuant to Section 2.6, the Borrower may not
		prepay any Libor Rate Loan prior to the last day of the Interest Period
		therefor. Any amount prepaid on account of a Revolving Credit Loan may be
		reborrowed in accordance with the provisions of Section 2.1 hereof. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(b) </FONT><U><FONT
		STYLE="font-size:10pt">Mandatory</FONT></U><FONT STYLE="font-size:10pt">. If,
		at any time, the aggregate outstanding principal balance of Revolving Credit
		Loans exceeds the Commitment, within three (3) days of the first day there
		exists such excess the Borrower shall make payment to the Bank in an amount
		equal to such excess together with any amounts payable pursuant to Section 2.12
		in connection therewith. Such payment shall be applied to reduce the aggregate
		unpaid principal balance of Revolving Credit Loans then outstanding in the
		Bank&#146;s reasonable discretion. Each prepayment shall be made together with
		payment of accrued interest on the amount prepaid to and including the date of
		prepayment.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt;text-indent:5%; text-align:left;">
		<FONT STYLE="font-size:10pt">2.9 </FONT><U><FONT
		STYLE="font-size:10pt">Payments</FONT></U><FONT STYLE="font-size:10pt">.</FONT>

	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(a) Interest accrued on each Revolving
		Credit Loan shall be payable, without duplication, on:</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:15%;text-align:left;">
		<FONT STYLE="font-size:10pt">(i) the Termination Date;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:15%;text-align:left;">
		<FONT STYLE="font-size:10pt">(ii) with respect to any portion of any
		Revolving Credit Loan repaid or prepaid pursuant to this Agreement, the date of
		such repayment or prepayment, as the case may be;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:15%;text-align:left;">
		<FONT STYLE="font-size:10pt">(iii) with respect to that portion of the
		outstanding principal amount of all Revolving Credit Loans maintained as Prime
		Rate Loans, the first day of each month and commencing with the first such date
		following the date of the making of such Revolving Credit Loans;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:15%;text-align:left;">
		<FONT STYLE="font-size:10pt">(iv) with respect to that portion of the
		outstanding principal amount maintained as Libor Rate Loans, the last day of
		each applicable Interest Period (and, if such Interest Period shall exceed
		three months, on the last day of each three-month period occurring during such
		Interest Period); and</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:15%;text-align:left;">
		<FONT STYLE="font-size:10pt">(v) with respect to that portion of the
		outstanding principal amount converted into Prime Rate Loans or Libor Rate
		Loans on a day when interest would not otherwise have been payable pursuant to
		Sections 2.9(a)(iii) or 2.9(a)(iv), the date of such conversion.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(b) All payments (including prepayments) to
		be made by the Borrower on account of principal or interest with respect to any
		Revolving Credit Loan or on account of fees or any other obligations of the
		Borrower to the Bank hereunder shall be made to the Bank at the office of the
		Bank set forth in Section 10.1 hereof or at such other place as the Bank may
		from time to time designate in writing in lawful money of the United States of
		America in immediately available funds. The Borrower hereby authorizes the Bank
		to deduct from any general deposit account of the Borrower the amount of any
		loan payment including all payments of interest, principal and other sums due
		(&#147;Automatic Payment&#148;), from time to time, under this Agreement and/or
		the Revolving Credit Note; the Bank will thereafter promptly notify the
		Borrower of the amount so charged. If the</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:12pt">-</FONT><FONT
		STYLE="font-size:10pt">9</FONT><FONT STYLE="font-size:12pt">-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
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	 SIZE="2"><PAGE>
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	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">funds in the account are insufficient to
		cover any payment due, the Bank shall not be obligated to advance funds to
		cover the payment. The failure of the Bank so to charge any account or to give
		any such notice shall not affect the obligation of the Borrower to pay
		interest, principal or other sums as provided herein or in the Revolving Credit
		Note, at any time and for any reason the Borrower or the Bank may voluntarily
		terminate the Automatic Payment. Termination by the Borrower of the Automatic
		Payment must be made by written notice to the Bank. Subject to the provisions
		of subparagraph (a) in the definition of Interest Period set forth in Section
		1.1 hereof, if any payment to be so made hereunder, or under the Revolving
		Credit Note, becomes due and payable on a day other than a Business Day, such
		payment shall be extended to the next succeeding Business Day and, to the
		extent permitted by applicable law, interest thereon shall be payable at the
		then applicable rate during such extension.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(c) If all or a portion of the principal or
		interest of any Revolving Credit Loan shall not be paid when due (whether at
		the stated or any accelerated maturity of such Revolving Credit Loan) or if any
		fee or other amount due hereunder shall not be paid when due, or upon the
		occurrence of an Event of Default, the Borrower&#146;s right to select pricing
		options shall cease and all Revolving Credit Loans, and such interest, fee or
		amount due hereunder, to the extent permitted by applicable law, shall bear
		interest (payable on demand) (i) in all cases other than Libor Rate Loans at
		the Post Default Rate until paid and (ii) in the case of Libor Rate Loans at
		the Post Default Rate until the expiration of the Interest Period applicable to
		such Revolving Credit Loan, at which time the Revolving Credit Loan will
		automatically be converted into a Prime Rate Loan and until paid shall bear
		interest at the Post Default Rate. In no event, however, shall interest payable
		hereunder be in excess of the maximum rate of interest permitted under
		applicable law. The obligation to so pay interest upon any reimbursement
		obligation of the Borrower to the Bank shall not be construed so as to waive
		the requirement for reimbursement on the same date that payment is made by the
		Bank as set forth in this Agreement. If a regularly scheduled payment is
		fifteen (15) days or more late, the Borrower will be charged five (5.0%)
		percent of the unpaid portion of the regularly scheduled payment, or $10.00,
		whichever is greater.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(d) All payments received will be applied
		first to interest, then to fees, and then to principal.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(e) The Borrower hereby expressly authorizes
		the Bank to record on the schedule attached to the Revolving Credit Note the
		amount and date of each Revolving Credit Loan, the rate of interest thereon,
		the date and amount of each payment of principal and the unpaid principal
		balance; provided, however, that the failure of the Bank to make any such
		notation shall not in any manner affect the obligation of the Borrower to repay
		any Revolving Credit Loan in accordance with the terms hereof. All such
		notations shall be presumed to be correct.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">2.10 </FONT><U><FONT
		STYLE="font-size:10pt">Use of Proceeds</FONT></U><FONT STYLE="font-size:10pt">.
		The proceeds of Revolving Credit Loans hereunder shall be used to finance
		working capital requirements of the Borrower and for general corporate
		purposes. No part of the proceeds of any Revolving Credit Loan will be used,
		whether directly or indirectly, for any purpose that entails a violation of any
		of the Federal Reserve Board Regulations including Regulations T, U and
		X</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-10-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">2.11 </FONT><U><FONT
		STYLE="font-size:10pt">Increased Costs</FONT></U><FONT STYLE="font-size:10pt">.
		If the Bank determines that the effect of any applicable law or government
		regulation, guideline or order or the interpretation thereof by any
		Governmental Authority charged with the administration thereof (such as, for
		example, a change in official reserve requirements which the Bank is required
		to maintain in respect of loans or deposits or other funds procured for funding
		such loans) is to increase the cost to the Bank of making or continuing Libor
		Rate Loans hereunder or to reduce the amount of any payment of principal or
		interest receivable by the Bank thereon, then the Borrower will pay to the Bank
		on demand such additional amounts as the Bank may reasonably determine to be
		required to compensate the Bank for such additional costs or reduction. Any
		additional payment under this section will be computed from the effective date
		at which such additional costs have to be borne by the Bank. A certificate as
		to any additional amounts payable pursuant to this Section 2.11 setting forth
		the basis and method of determining such amounts shall be conclusive, absent
		manifest error, as to the determination by the Bank set forth therein if made
		reasonably and in good faith. The Borrower shall pay any amounts so certified
		to it by the Bank within ten (10) days of receipt of any such certificate. For
		purposes of this Section 2.11 all references to the &#147;Bank&#148; shall be
		deemed to include any participant in the Commitment and/or Revolving Credit
		Loans.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">2.12 </FONT><U><FONT
		STYLE="font-size:10pt">Indemnities</FONT></U><FONT STYLE="font-size:10pt">. The
		Borrower hereby indemnifies the Bank against any and all loss and reasonable
		expenses which the Bank may sustain or incur as a consequence of any of the
		following:</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(a) default in payment of the principal
		amount of any Libor Rate Loan or any part thereof or interest accrued thereon,
		or any other amount due in connection with the Loan Documents;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(b) the occurrence of any other Default
		under this Agreement; or</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(c) the failure of the Borrower to borrow a
		Libor Rate Loan after sending notice of the amount and requested interest rate
		with respect to the making of any such Revolving Credit Loan;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(d) the receipt or recovery by the Bank of
		all or any part of a Libor Rate Loan prior to the last day of the Interest
		Period thereof (whether by prepayment, acceleration or otherwise); or</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(e) the conversion, prior to the last day of
		an applicable Interest Period, of one type of Libor Rate Loan into another type
		of Libor Rate Loan or into a Prime Rate Loan.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">Without limiting the effect of the
		foregoing, the amount to be paid by the Borrower to the Bank in order to so
		indemnify the Bank for any loss occasioned by any of the events described in
		the proceeding paragraph, and as liquidated damages therefor, shall be equal to
		the excess, discounted to its present value as of the date paid to the Bank, of
		(i) the amount of interest which otherwise would have accrued on the principal
		amount so received, recovered, converted or not borrowed during the period (the
		&#147;Indemnity Period&#148;) commencing with the date of such receipt,
		recovery, conversion, or failure to borrow to the last day of the applicable
		Interest Period for such Libor Rate Loan at the rate of interest applicable to
		such Revolving Credit Loan (or rate of interest agreed to in the case of a
		failure to borrow), provided for herein (prior to a Default) over (ii) the
		amount of interest which </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-11-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">would be earned by the Bank during the
		Indemnity Period if it invested the principal amount so received, recovered,
		converted or not borrowed at the rate per annum determined by the Bank as the
		rate it would bid in the London interbank market for a deposit of eurodollars
		in an amount approximately equal to such principal amount for a period of time
		comparable to the Indemnity Period.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">A certificate as to any additional amounts
		payable pursuant to this Section 2.12 setting forth the basis and method of
		determining such amounts shall be presumed correct, absent manifest error, as
		to the determination by the Bank set forth therein if made reasonably and in
		good faith. The Borrower shall pay any amounts so certified to it by the Bank
		within ten (10) days of receipt of any such certificate. For purposes of this
		Section 2.12, all references to the &#147;Bank&#148; shall be deemed to include
		any participant in the Commitment and/or Revolving Credit Loans.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">2.13 </FONT><U><FONT
		STYLE="font-size:10pt">Alternate Rate of Interest</FONT></U><FONT
		STYLE="font-size:10pt">. In the event, and on each occasion, that on the day
		two Business Days prior to the commencement of any Interest Period for a
		Revolving Credit Loan, the Bank shall have reasonably determined (i) that
		dollar deposits in the amount of the requested principal amount of such Loan
		are not generally available in the London Interbank Market, (ii) that the rate
		at which such dollar deposits are being offered will not adequately and fairly
		reflect the cost to the Bank of making or maintaining such Loan during such
		Interest Period, or (iii) that reasonable means do not exist for ascertaining
		the Libor Rate, the Bank shall, as soon as practicable thereafter, give written
		or facsimile notice of such determination to the Borrower. In the event of any
		such determination, until the circumstances giving rise to such notice no
		longer exist, no Libor Rate Loans will be made hereunder. Each determination by
		the Bank hereunder shall be conclusive absent manifest error. For purposes of
		this Section 2.13, all references to the &#147;Bank&#148; shall be deemed to
		include any participant in the Commitment and/or the Revolving Credit
		Loans.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">2.14 </FONT><U><FONT
		STYLE="font-size:10pt">Change in Legality</FONT></U><FONT
		STYLE="font-size:10pt">.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(a) Notwithstanding anything to the contrary
		herein contained, if any change in any law or regulation or in the
		interpretation thereof by any governmental authority charged with the
		administration or interpretation thereof shall make it unlawful for the Bank to
		make or maintain any Libor Rate Loan, then, by written notice to the Borrower,
		the Bank may:</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:15%;text-align:left;">
		<FONT STYLE="font-size:10pt">(i) declare that Libor Rate Loans will not
		thereafter be made by the Bank hereunder, whereupon the Borrower shall be
		prohibited from requesting Libor Rate Loans from the Bank hereunder unless such
		declaration is subsequently withdrawn; and</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:15%;text-align:left;">
		<FONT STYLE="font-size:10pt">(ii) require that all outstanding Libor Rate
		Loans made by it be converted to Prime Rate Loans, in which event (x) all such
		Libor Rate Loans shall be automatically converted to Prime Rate Loans as of the
		effective date of such notice as provided in paragraph (b) below and (y) all
		payments and prepayments of principal which would otherwise have been applied
		to repay the converted Libor Rate Loans shall instead be applied to repay the
		Prime Rate Loans resulting from the conversion of such Libor Rate Loans.</FONT>

	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(b) For purposes of this Section 2.14, (i) a
		notice to the Borrower by the Bank pursuant to paragraph (a) above shall be
		effective, if lawful, on the last day of the then current </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-12-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">Interest Period; in all other cases, such
		notice shall be effective on the day of receipt by the Borrower and (ii) for
		purposes of this Section 2.14, all references to the &#147;Bank&#148; shall be
		deemed to include any participant in the Commitment and/or the Revolving Credit
		Loans.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt; text-align:center;">
		<FONT STYLE="FONT-SIZE:10PT">SECTION 3. </FONT><U><FONT
		STYLE="FONT-SIZE:10PT">REPRESENTATIONS AND WARRANTIES</FONT></U>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">In order to induce the Bank to enter into
		this Agreement and to make the financial accommodations herein provided for,
		the Borrower hereby covenants, represents and warrants to the Bank that:</FONT>

	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">3.1 </FONT><U><FONT
		STYLE="font-size:10pt">Financial Condition</FONT></U><FONT
		STYLE="font-size:10pt">. The balance sheet of the Borrower as at December 31,
		2006, and the related statements of income, retained earnings and cash flows
		for the fiscal year ended on such date, audited by J.H. Cohn LLP, CPAs and the
		unaudited balance sheet of the Borrower as at March 31, 2007 and the related
		statements of income, retained earnings and cash flows for the fiscal quarter
		ended on such date, copies of which statements have heretofore been furnished
		to the Bank, are complete and correct and present fairly the financial
		condition of the Borrower as at such dates, and the results of its operations
		and changes in financial position for the fiscal periods then ended. Such
		financial statements, including schedules and notes thereto, have been prepared
		in accordance with GAAP. The Borrower does not have any material contingent
		obligations, contingent liabilities or liabilities for taxes, long-term leases
		or unusual forward or long-term commitments, which are not reflected in the
		foregoing statements or in the notes thereto. Since the date of the
		aforementioned financial statements, there has been no material adverse change
		in the business, operations, assets or financial or other condition of the
		Borrower.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">3.2 </FONT><U><FONT
		STYLE="font-size:10pt">Corporate Existence; Compliance with the
		Law</FONT></U><FONT STYLE="font-size:10pt">. The Borrower and each of its
		Subsidiaries (a) is duly organized, validly existing and in good standing under
		the laws of the jurisdiction of its incorporation; (b) has the corporate power
		and authority and the legal right to own and operate its property, and to
		conduct the business in which it is currently engaged; (c) is duly qualified as
		a corporation and is in good standing under the laws of each jurisdiction where
		its ownership or operation of property or the conduct of its business require
		such qualification; and (d) is in compliance with all Requirements of
		Law.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">3.3 </FONT><U><FONT
		STYLE="font-size:10pt">Corporate Power; Authorization; Enforceable
		Obligations</FONT></U><FONT STYLE="font-size:10pt">. The Borrower has the
		corporate power, authority and legal right to make, execute, deliver and
		perform its obligations under this Agreement and the Loan Documents to which it
		is a party and to borrow hereunder; and has taken all necessary corporate
		action to authorize the borrowings on the terms and conditions of this
		Agreement and such Loan Documents and to authorize the execution, delivery and
		performance of this Agreement and such Loan Documents. No consent or
		authorization of, filing with, or other act by or in respect of any other
		Person (including shareholders and creditors of the Borrower) or any
		Governmental Authority, other than the filing of UCC-1 Financing Statements
		with the applicable office in connection with the Security Agreement, is
		required in connection with the borrowings hereunder or with the execution,
		delivery, performance, validity or enforceability of this Agreement or such
		Loan Documents. This Agreement and such Loan Documents will be duly executed
		and delivered on behalf of the Borrower, and this Agreement and such Loan
		Documents, when executed and delivered, will each constitute a legal, valid and
		binding obligation of the Borrower enforceable against the Borrower in
		accordance with its terms, except as enforceability </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-13-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 SIZE="2"><PAGE>
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	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">may be limited by applicable bankruptcy,
		insolvency, reorganization, moratorium, fraudulent conveyance or similar laws
		affecting the enforcement of creditors&#146; rights generally.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">3.4 </FONT><U><FONT
		STYLE="font-size:10pt">No Legal Bar</FONT></U><FONT STYLE="font-size:10pt">.
		The execution, delivery and performance of the Loan Documents and the
		borrowings hereunder and the use of the proceeds thereof by the Borrower and
		the execution, delivery and performance of the Loan Documents to which it is a
		party by any Specified Person, will not violate any Requirement of Law or any
		Contractual Obligation of any Specified Person, and will not result in, or
		require, the creation or imposition of any Lien on any of its properties or
		revenues pursuant to any Requirement of Law or Contractual Obligation except
		those in favor of the Bank provided herein.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">3.5 </FONT><U><FONT
		STYLE="font-size:10pt">No Material Litigation</FONT></U><FONT
		STYLE="font-size:10pt">. No litigation, investigation or proceeding of or
		before any arbitrator or Governmental Authority is pending by or against any
		Specified Person or against any of their properties or revenues (a) with
		respect to the Loan Documents or any of the transactions contemplated hereby or
		thereby, or (b) which if adversely determined, would have a material adverse
		effect on the business, operations, property or financial or other condition of
		any Specified Person.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">3.6 </FONT><U><FONT
		STYLE="font-size:10pt">No Default</FONT></U><FONT STYLE="font-size:10pt">. No
		Specified Person is in default under or with respect to any Contractual
		Obligation in any respect which could be materially adverse to the business,
		operations, property or financial or other condition of such Specified Person,
		or which could materially and adversely affect the ability of any Specified
		Person to perform its respective obligations under the Loan Documents to which
		it is a party. No Default or Event of Default has occurred and is
		continuing.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">3.7 </FONT><U><FONT
		STYLE="font-size:10pt">No Burdensome Restrictions</FONT></U><FONT
		STYLE="font-size:10pt">. No Contractual Obligation of any Specified Person and
		no Requirement of Law materially adversely affects, or insofar as the Borrower
		may reasonably foresee may so affect, the business, operations, property or
		financial or other condition of any such Specified Person.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">3.8 </FONT><U><FONT
		STYLE="font-size:10pt">Taxes</FONT></U><FONT STYLE="font-size:10pt">. Each
		Specified Person has filed or caused to be filed all tax returns which to the
		knowledge of the Borrower are required to be filed or has received extensions
		that are validly in effect, and have paid all taxes shown to be due and payable
		on said returns or on any assessments made against them or any of their
		property.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">3.9 </FONT><U><FONT
		STYLE="font-size:10pt">Federal Regulations</FONT></U><FONT
		STYLE="font-size:10pt">. The Borrower is not engaged nor will it engage,
		principally or as one of its important activities, in the business of extending
		credit for the purpose of &#147;purchasing&#148; or &#147;carrying&#148; any
		&#147;margin stock&#148; within the respective meanings of each of the quoted
		terms under Regulation U of the Board of Governors of the Federal Reserve
		System as now and from time to time hereafter in effect. No part of the
		proceeds of any Revolving Credit Loans hereunder will be used for
		&#147;purchasing&#148; or &#147;carrying&#148; &#147;margin stock&#148; as so
		defined or for any purpose which violates, or which would be inconsistent with,
		the provisions of the Regulations of such Board of Governors.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">3.10 </FONT><U><FONT
		STYLE="font-size:10pt">Environmental Matters</FONT></U><FONT
		STYLE="font-size:10pt">.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-14-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 SIZE="2"><PAGE>
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	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(a) None of the Real Property contains, or
		to the best knowledge of the Borrower has previously contained, any hazardous
		or toxic waste or substances or underground storage tanks.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(b) The Real Property is in material
		compliance with all applicable Federal, state and local environmental standards
		and requirements affecting such Real Property, and there are no environmental
		conditions which could materially interfere with the continued use of the Real
		Property.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(c) No Specified Person has received any
		notices of violations or advisory action by regulatory agencies regarding
		environmental control matters or permit compliance.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(d) To the knowledge of the Borrower,
		hazardous waste has not been transferred from any of the Real Property to any
		other location which is not in compliance with all applicable environmental
		laws, regulations or permit requirements.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(e) With respect to the Real Property, there
		are no proceedings, governmental administrative actions or judicial proceedings
		pending or, to the best knowledge of the Borrower, contemplated under any
		Federal, state or local law regulating the discharge of hazardous or toxic
		materials or substances into the environment, to which the Borrower or any of
		its Subsidiaries is named as a party.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">3.11 </FONT><U><FONT
		STYLE="font-size:10pt">Ownership of Property; Liens</FONT></U><FONT
		STYLE="font-size:10pt">. Each Specified Person has title in fee simple to, or a
		valid leasehold interest in, all Real Property, and good title to, or a valid
		leasehold interest in, all its other property, and none of such property is
		subject to any Lien except as permitted by Section 7.4 hereof.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">3.12 </FONT><U><FONT
		STYLE="font-size:10pt">Intellectual Property</FONT></U><FONT
		STYLE="font-size:10pt">. Each Specified Person owns, or is licensed to use, all
		Intellectual Property necessary for the conduct of its business as currently
		conducted. No material claim has been asserted and is pending by any Person
		challenging or questioning the use of any Intellectual Property or the validity
		or effectiveness of any Intellectual Property, nor does the Borrower know of
		any valid basis for any such claim. To the knowledge of the Borrower, the use
		of Intellectual Property by any Specified Person does not infringe on the
		rights of any Person in any material respect.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">3.13 </FONT><U><FONT
		STYLE="font-size:10pt">Labor Matters</FONT></U><FONT STYLE="font-size:10pt">.
		There are no strikes or other labor disputes against any Specified Person
		pending, or, to the knowledge of the Borrower, threatened that (individually or
		in the aggregate) could reasonable be expected to have a material adverse
		effect upon the Borrower&#146;s business, operations or property. Hours worked
		by any payment to employees of each Specified Person have not been in violation
		of the Fair Labor Standards Act or any other applicable Requirement of Law
		dealing with such matters that (individually or in the aggregate) could
		reasonably be expected to have a material adverse effect upon the
		Borrower&#146;s business, operations or property. All payments due from any
		Specified Person on account of employee health and welfare insurance that
		(individually or in the aggregate) could reasonably be expected to have a
		material adverse effect upon the Borrower&#146;s business, operations or
		property if not paid have been paid or accrued as a liability on the books of
		each Specified Person.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-15-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">3.14 </FONT><U><FONT
		STYLE="font-size:10pt">Borrower Subsidiaries</FONT></U><FONT
		STYLE="font-size:10pt">. The Borrower has no Subsidiaries as of the date
		hereof.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:center;">
		<FONT STYLE="FONT-SIZE:10PT">SECTION 4. </FONT><U><FONT
		STYLE="FONT-SIZE:10PT">CONDITIONS PRECEDENT</FONT></U><FONT
		STYLE="font-size:10pt">.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">4.1 </FONT><U><FONT
		STYLE="font-size:10pt">Conditions of Initial Extensions of
		Credit</FONT></U><FONT STYLE="font-size:10pt">. The obligation of the Bank to
		make the initial extension of credit to the Borrower hereunder is subject to
		the satisfaction of the following conditions precedent:</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(a) </FONT><U><FONT
		STYLE="font-size:10pt">Revolving Credit Note</FONT></U><FONT
		STYLE="font-size:10pt">. The Bank shall have received the Revolving Credit Note
		conforming to the requirements hereof substantially in the form of Exhibit A
		hereto with appropriate insertions and duly executed by the Borrower.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(b) </FONT><U><FONT
		STYLE="font-size:10pt">Security Agreement</FONT></U><FONT
		STYLE="font-size:10pt">. The Bank shall have received the Security Agreement
		duly executed by the Borrower together with security agreement questionnaire in
		the form provided by the Bank, UCC searches and insurance certificates and paid
		receipts naming the Bank as loss payee, evidencing personal property coverage
		(for inventory and equipment) on ACORD Form 27 and general liability coverage
		on ACORD Form 25.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(c) </FONT><U><FONT
		STYLE="font-size:10pt">Assignment Statements</FONT></U><FONT
		STYLE="font-size:10pt">. The Bank shall have received UCC-3 Assignment
		Statements and other evidence of assignment of the prior JPMorgan Chase Bank
		lien upon the Borrower&#146;s property, which lien shall be superior to that
		held by Citibank, N.A.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(d) </FONT><U><FONT
		STYLE="font-size:10pt">Legal Opinion</FONT></U><FONT STYLE="font-size:10pt">.
		The Bank shall have received a favorable opinion of counsel to the Borrower.
		Such opinion shall cover such matters incident to the transactions contemplated
		by this Agreement as the Bank shall reasonably require.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(e) </FONT><U><FONT
		STYLE="font-size:10pt">Certified Copies and Other Documents</FONT></U><FONT
		STYLE="font-size:10pt">. The Bank shall have received such certificates and
		other documents relating to the Borrower with respect to the matters herein
		contemplated as the Bank may request, including but not limited to:</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:15%;text-align:left;">
		<FONT STYLE="font-size:10pt">(i) certificates of good standing from the
		Secretary of State of New York if incorporated or formed under the laws of the
		State of New York or doing business in New York and, if incorporated or formed
		in a jurisdiction other than New York, from the Secretary of State or
		applicable Governmental Authority of such jurisdiction of incorporation and
		from the Secretary of State or applicable Governmental Authority of each
		jurisdiction in which an office is maintained; and</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:15%;text-align:left;">
		<FONT STYLE="font-size:10pt">(ii) certificates of an officer of the
		Borrower dated on or about the date of this Agreement certifying as to (w) true
		and current copies of the Borrower&#146;s certificate of incorporation and all
		amendments thereto, (x) true and correct copies of the bylaws of the Borrower
		and all amendments thereto, (y) true and correct copies of resolutions adopted
		by the board of directors of the Borrower authorizing (1) the execution,
		delivery and performance by the Borrower of each of the Loan Documents to which
		it is a party and the performance by the Borrower of its obligations under each
		of the Loan Documents to which it is a party, (2) approving forms in
		substantially execution form of each of the Loan Documents to which it is a
		party, and (3) authorizing officers of the Borrower to execute and deliver each
		of the Loan Documents to which it</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-16-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">is a party, and (z) the incumbency and
		specimen signatures of the duly authorized officers of the Borrower executing
		the Loan Documents and any other documents delivered to the Bank by the
		Borrower in connection herewith.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(f) </FONT><U><FONT
		STYLE="font-size:10pt">Searches, Etc. </FONT></U><FONT
		STYLE="font-size:10pt">The Bank shall have received and reviewed satisfactory
		lien, judgment and tax lien searches against the Borrower.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(g) </FONT><U><FONT
		STYLE="font-size:10pt">Fees</FONT></U><FONT STYLE="font-size:10pt">. The Bank
		shall have received evidence of the payment of (1) the Bank&#146;s commitment
		fee in the amount of $5,000.00, and (2) the fees and disbursements of the
		Bank&#146;s counsel.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(h) </FONT><U><FONT
		STYLE="font-size:10pt">Additional Matters</FONT></U><FONT
		STYLE="font-size:10pt">. All other documents and legal matters in connection
		with the transactions contemplated by this Agreement shall be reasonably
		satisfactory in form and substance to the Bank and its counsel.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">4.2 </FONT><U><FONT
		STYLE="font-size:10pt">Conditions to All Loans</FONT></U><FONT
		STYLE="font-size:10pt">. The obligation of the Bank to make any Revolving
		Credit Loan (including the initial Revolving Credit Loan) to be made by it
		hereunder is subject to the satisfaction of the following conditions
		precedent:</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(a) </FONT><U><FONT
		STYLE="font-size:10pt">Representations and Warranties</FONT></U><FONT
		STYLE="font-size:10pt">. The representations and warranties made by the
		Borrower herein or which are contained in any certificate, document or
		financial or other statement furnished at any time under or in connection
		herewith, shall be correct on and as of the borrowing date for such extension
		of credit as if made on and as of such date.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(b) </FONT><U><FONT
		STYLE="font-size:10pt">No Default or Event of Default</FONT></U><FONT
		STYLE="font-size:10pt">. No Default or Event of Default shall have occurred and
		be continuing on the date an extension of credit is to be made or after giving
		effect to the extension of credit to be made on such date.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:center;">
		<FONT STYLE="FONT-SIZE:10PT">SECTION 5. </FONT><U><FONT
		STYLE="FONT-SIZE:10PT">AFFIRMATIVE COVENANTS</FONT></U><FONT
		STYLE="font-size:10pt">.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">The Borrower hereby agrees that, so long as
		the Commitment remains in effect, the Revolving Credit Note remains outstanding
		and unpaid, or any amount is owing to the Bank hereunder, the Borrower will and
		will cause each Specified Person, as applicable, to:</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">5.1 </FONT><U><FONT
		STYLE="font-size:10pt">Existence, Qualification and Conduct of
		Business</FONT></U><FONT STYLE="font-size:10pt">. Take the necessary steps to
		preserve its corporate existence and its right to conduct business in all
		states in which the nature of its business requires qualification to do
		business, and continue to engage in business of the same general type as now
		conducted by it, and maintain all rights, privileges, licenses and franchises
		necessary or desirable in the ordinary course of its business.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">5.2 <U>Financial Information and Compliance
		Certificates</U>.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:0pt; text-indent:10%; text-align:left;">
		<FONT STYLE="font-size:10pt">(a) Keep its books of record and account in
		accordance with GAAP and furnish to the Bank:</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-17-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:15%;text-align:left;">
		<FONT STYLE="font-size:10pt">(i) within (y) ninety (90) days after the
		last day of each of its fiscal years, the consolidated balance sheets of the
		Borrower and consolidated statements of income, retained earnings and cash
		flows prepared in accordance with GAAP consistently applied and audited by J.H.
		Cohn LLP, CPAs or another firm of independent certified public accountants
		selected by the Borrower and reasonably satisfactory to the Bank; and (z)
		within sixty (60) days after the close of each of the first, second and third
		quarters of each fiscal year, a consolidated balance sheet of the Borrower and
		consolidated statements of income, retained earnings and cash flows as of the
		last day of and for such quarter and for the period of the fiscal year ended as
		of the close of the particular quarter, all such quarterly statements to be in
		reasonable detail, and certified by the chief financial or chief executive
		officer of the Borrower as having been prepared in accordance with GAAP
		(subject to year-end adjustments).</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:15%;text-align:left;">
		<FONT STYLE="font-size:10pt">(ii) within twenty (20) days after the end
		of each month, a schedule of projects in which the Borrower is then involved
		(each a &#147;Work-in-Progress Schedule&#148;), in form and substance
		satisfactory to the Bank and including, without limitation: (y) an
		identification of each project by name, and (z) the contract price for each
		such project (including any change orders), the costs incurred to date, gross
		profit to date, contract billings to date, costs and estimated earnings in
		excess of billings and billings in excess of costs and estimated earnings, and
		costs to complete. The Work-in-Progress Schedule will include contract revenues
		earned and contract costs for the period reported. Each such Work-in-Progress
		Schedule shall be certified by the chief financial or chief executive officer
		of the Borrower as being true, correct and complete to the best of such
		officer&#146;s knowledge.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:15%;text-align:left;">
		<FONT STYLE="font-size:10pt">(iii) with each corresponding
		Work-in-Progress Schedule as specified in subsection (ii) above, an accounts
		receivable aging schedule in form and detail reasonably acceptable to the
		Bank.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">The Borrower will also, with reasonable
		promptness, furnish such other data as may be reasonably requested by the Bank
		and will at all times and from time to time permit the Bank by or through any
		of its officers, agents, employees, attorneys or accountants to inspect and
		make extracts from the Borrower&#146;s books and records.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(b) At the same time as it delivers the
		financial statements called for by Section 5.2(a)(i), deliver a certificate of
		the chief financial or chief executive officer of the Borrower evidencing a
		computation of compliance with the provisions of Section 6 (inclusive) hereof
		and stating that in each case, except as disclosed in such certificate, the
		person making such certificate has no knowledge of any Default or Event of
		Default.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(c) Within ten (10) days of any executive
		officer of the Borrower obtaining knowledge of any Default, if such Default is
		then continuing, the Borrower shall furnish to the Bank a certificate of the
		chief financial officer of the Borrower setting forth the details thereof and
		the action which the Borrower is taking or proposes to take with respect
		thereto.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">5.3 </FONT><U><FONT
		STYLE="font-size:10pt">Insurance</FONT></U><FONT STYLE="font-size:10pt">.
		Maintain insurance with responsible and reputable insurance companies or
		associations in such amounts and covering such risks as is usually carried by
		companies engaged </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-18-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
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	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">in similar businesses and owning similar
		properties in the same general areas in which the Borrower operates.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">5.4 </FONT><U><FONT
		STYLE="font-size:10pt">Preservation of Properties; Compliance with
		Law</FONT></U><FONT STYLE="font-size:10pt">. Maintain and preserve all of its
		properties which are used or which are useful in the conduct of its business in
		good working order and condition, ordinary wear and tear excepted and comply
		with all Requirements of Law.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">5.5 </FONT><U><FONT
		STYLE="font-size:10pt">Taxes</FONT></U><FONT STYLE="font-size:10pt">. Duly pay
		and discharge all taxes or other claims which might become a lien upon any of
		its property except to the extent that any thereof are being in good faith
		appropriately contested with adequate reserves provided therefor.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">5.6 </FONT><U><FONT
		STYLE="font-size:10pt">Maintain Relationship</FONT></U><FONT
		STYLE="font-size:10pt">. Maintain its primary commercial banking relationship
		with the Bank and its primary operating accounts with the Bank.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">5.7 </FONT><U><FONT
		STYLE="font-size:10pt">Notice of Litigation</FONT></U><FONT
		STYLE="font-size:10pt">. Promptly notify the Bank in writing of any litigation,
		legal proceeding or dispute, other than disputes in the ordinary course of
		business or, whether or not in the ordinary course of business, involving
		amounts in excess of $250,000.00, affecting the Borrower or any other Specified
		Person whether or not fully covered by insurance, and regardless of the subject
		matter thereof (excluding, however, any actions relating to workers&#146;
		compensation claims or negligence claims relating to use of motor vehicles, if
		fully covered by insurance, subject to deductibles).</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">5.8 </FONT><U><FONT
		STYLE="font-size:10pt">Indemnity (Environmental Matters)</FONT></U><FONT
		STYLE="font-size:10pt">. Indemnify the Bank against any liability, loss, cost,
		damage, or expense (including, without limitation, reasonable attorneys&#146;
		fees) arising from (i) the imposition or recording of a lien by any local,
		state, or Federal government or governmental agency or authority pursuant to
		any Cleanup Laws; (ii) claims of any private parties regarding violations of
		Cleanup Laws; and (iii) costs and expenses (including, without limitation,
		reasonable attorneys&#146; fees and fees incidental to the securing of
		repayment of such costs and expenses) incurred by any Specified Person or the
		Bank in connection with compliance by any person or the Bank with any statute,
		regulation or order issued pursuant to any Cleanup Laws by any local, state or
		Federal government or governmental agency or authority.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">5.9 </FONT><U><FONT
		STYLE="font-size:10pt">New Subsidiaries</FONT></U><FONT
		STYLE="font-size:10pt">. Cause any Subsidiary formed after the date this
		Agreement to become a Guarantor of the Obligations and to execute and deliver
		promptly to the Bank: (i) a Guaranty, and (ii) certificates and charter
		documents for such Subsidiary, similar to those requested from the Borrower in
		Section 4.1(e) hereof authorizing the Guarantor&#146;s entry into and
		performance of its the Guaranty, including (without limitation) the unanimous
		written consent of its shareholders.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">5.10 </FONT><U><FONT
		STYLE="font-size:10pt">Landlord Waiver and Consent</FONT></U><FONT
		STYLE="font-size:10pt">. Within thirty (30) days after written request, the
		Bank shall have received a Landlord Waiver and Consent from the landlord with
		respect to the premises at 60 Heartland Boulevard, Edgewood, New York
		reasonably satisfactory in form and substance to the Bank and its
		counsel.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:center;">
		<FONT STYLE="FONT-SIZE:10PT">SECTION 6. </FONT><U><FONT
		STYLE="FONT-SIZE:10PT">FINANCIAL COVENANTS</FONT></U>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-19-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
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	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">The Borrower hereby agrees that, so long as
		the Commitment remains in effect, the Revolving Credit Note remains outstanding
		and unpaid, or any amount is owing to the Bank hereunder, the Borrower
		will:</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">6.1 </FONT><U><FONT
		STYLE="font-size:10pt">Interest Coverage Ratio</FONT></U><FONT
		STYLE="font-size:10pt">. Maintain as of the end of each fiscal quarter, a
		minimum Interest Coverage Ratio (as defined below) of at least 2.0 to 1.0. For
		purposes hereof, &#147;Interest Coverage Ratio&#148; means the ratio of (y)
		EBIT (as hereinafter defined) to (z) Interest Expense for such fiscal period.
		For purposes hereof, &#147;EBIT&#148; means the total of, for each period, (i)
		the net earnings of the Borrower plus (ii) all amounts deducted in computing
		such net income in respect of (a) Interest Expense on Indebtedness and (b)
		taxes based upon or measured by income as determined in accordance with
		GAAP.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">6.2 </FONT><U><FONT
		STYLE="font-size:10pt">Net Profit</FONT></U><FONT STYLE="font-size:10pt">.
		Maintain as of the end of each fiscal quarter, a net profit after taxes of at
		least $1.00.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:center;">
		<FONT STYLE="FONT-SIZE:10PT">SECTION 7. </FONT><U><FONT
		STYLE="FONT-SIZE:10PT">NEGATIVE COVENANTS</FONT></U><FONT
		STYLE="font-size:10pt">.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">The Borrower hereby agrees that, so long as
		the Commitment remains in effect, the Revolving Credit Note remains outstanding
		and unpaid, or any amount is owing to the Bank hereunder it will not, nor will
		it permit any of its Subsidiaries or any Specified Person to:</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">7.1 </FONT><U><FONT
		STYLE="font-size:10pt">Indebtedness for Borrowed Money</FONT></U><FONT
		STYLE="font-size:10pt">. Incur, or permit to exist, any Indebtedness for
		borrowed money except (i) Indebtedness incurred pursuant to borrowings
		hereunder and under any other loans made by the Bank in its discretion to the
		Borrower, (ii) Indebtedness existing on the date hereof and reflected in the
		financial statements referred to in Section 3.1 hereof and (iii) purchase money
		Indebtedness incurred in the acquisition of fixed assets permitted under
		Section 7.4(iv) hereof not in excess of $250,000.00 in the aggregate for the
		term of the Commitment.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">7.2 </FONT><U><FONT
		STYLE="font-size:10pt">Mergers, Acquisitions and Sales of
		Assets</FONT></U><FONT STYLE="font-size:10pt">. Enter into any merger or
		consolidation or liquidate, windup or dissolve itself or sell, transfer or
		lease or otherwise dispose of all or any substantial part of its assets (other
		than sales of inventory and obsolescent equipment in the ordinary course of
		business) or acquire by purchase or otherwise the business or assets of, or
		stock of, another business entity; except that any Subsidiary may merge into or
		consolidate with any other Subsidiary which is wholly-owned by the Borrower and
		any Subsidiary which is wholly-owned by the Borrower may merge with or
		consolidate into the Borrower provided that the Borrower is the surviving
		corporation.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">7.3 </FONT><U><FONT
		STYLE="font-size:10pt">Loans; Investments</FONT></U><FONT
		STYLE="font-size:10pt">. Lend or advance money, credit or property to or invest
		in (by capital contribution, loan, purchase or otherwise) any firm,
		corporation, or other Person except investments in: (i) United States
		Government obligations, certificates of deposit of any banking institution with
		combined capital and surplus of at least $200,000,000.00; (ii) accounts
		receivable arising out of sales of inventory in the ordinary course of
		business; and (iii) loans to and investments in Subsidiaries.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">7.4 </FONT><U><FONT
		STYLE="font-size:10pt">Liens</FONT></U><FONT STYLE="font-size:10pt">. Create,
		assume or permit to exist, any Lien on any of its property or assets now owned
		or hereafter acquired except (i) Liens in favor of the Bank; (ii) other Liens
		incidental to</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-20-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">the conduct of its business or the ownership
		of its property and assets which were not incurred in connection with the
		borrowing of money or the obtaining of advances or credit and which do not
		materially impair the use thereof in the operation of its business; (iii) Liens
		for taxes or other governmental charges which are not delinquent or which are
		being contested in good faith and for which a reserve shall have been
		established in accordance with GAAP; (iv) purchase money Liens granted to
		secure the unpaid purchase price of any fixed assets purchased within the
		limitations of Section 7.8 hereof, provided that (w) such Liens shall be
		created substantially simultaneously with the acquisition of such fixed assets,
		(x) such Liens do not at any time encumber any property other than the property
		financed by such Indebtedness, (y) the amount of Indebtedness secured thereby
		is not increased and (z) the principal amount of such Indebtedness shall not
		exceed 100% of the purchase price of such assets; (v) Liens set forth in the
		financial statements referred to in Section 3.1 hereof; (vi) carriers&#146;,
		warehousemen&#146;s, mechanics&#146;, materialmen&#146;s, repairmen&#146;s or
		other like Liens arising in the ordinary course of business which are not
		overdue for a period of more than thirty (30) days or which are being contested
		in good faith by appropriate proceedings; (vii) pledges or deposits in
		connection with workers&#146; compensation, unemployment insurance and other
		social security legislation; (viii) deposits to secure the performance of bids,
		trade contracts (other than for borrowed money), leases, statutory obligations,
		surety and appeal bonds, performance bonds and other obligations of a like
		nature incurred in the ordinary course of business; (ix) any interest or title
		of a lessor under any lease entered into by the Borrower or any of its
		Subsidiaries in the ordinary course of its business and covering only the
		assets to be leased; and (x) Liens in favor of the United States of America
		described in the Subordination Agreement.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">7.5 </FONT><U><FONT
		STYLE="font-size:10pt">Contingent Liabilities</FONT></U><FONT
		STYLE="font-size:10pt">. Assume, endorse, be or become liable for or guarantee
		the obligations of any Person excluding, however, the endorsement of negotiable
		instruments for deposit or collection in the ordinary course of
		business.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">7.6 </FONT><U><FONT
		STYLE="font-size:10pt">Limitation on Dividends</FONT></U><FONT
		STYLE="font-size:10pt">. Declare or pay any dividend on, or make any payment on
		account of, or set apart assets for a sinking or other analogous fund for the
		purchase, redemption, defeasance, retirement or other acquisition of any shares
		of any class of capital stock of the Borrower or any Subsidiary or any warrants
		or options to purchase any such capital stock, whether now or hereafter
		outstanding, or make any other distribution in respect thereof, either directly
		or indirectly, whether in cash or property or in obligations of the Borrower or
		any Subsidiary (collectively, &#147;Restricted Payments), except that any
		Subsidiary may make Restricted Payments to the Borrower.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">7.7 </FONT><U><FONT
		STYLE="font-size:10pt">Sales of Receivables; Sale - Leasebacks</FONT></U><FONT
		STYLE="font-size:10pt">. Sell, discount or otherwise dispose of notes, accounts
		receivable or other obligations owing to the Borrower, with or without
		recourse, except for the purpose of collection in the ordinary course of
		business; or sell any asset pursuant to an arrangement to thereafter lease such
		asset from the purchaser thereof.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">7.8 </FONT><U><FONT
		STYLE="font-size:10pt">Capital Expenditures; Capitalized Leases</FONT></U><FONT
		STYLE="font-size:10pt">. Expend in the aggregate for the Borrower and all
		Subsidiaries in excess of $750,000.00 in any fiscal year for Capital
		Expenditures. For purposes of the foregoing, Capital Expenditures shall include
		payments made on account of any deferred purchase price or on account of any
		indebtedness incurred to finance any such purchase price.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-21-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">7.9 </FONT><U><FONT
		STYLE="font-size:10pt">Nature of Business</FONT></U><FONT
		STYLE="font-size:10pt">. Enter into any business, either directly or indirectly
		through any Subsidiary, except for those businesses in which the Borrower and
		its Subsidiaries are engaged on the date of this Agreement or which are
		reasonably related thereto.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">7.10 </FONT><U><FONT
		STYLE="font-size:10pt">Stock of Subsidiaries</FONT></U><FONT
		STYLE="font-size:10pt">. Sell or otherwise dispose of any Subsidiary (except in
		connection with a merger or consolidation of such Subsidiary into the Borrower
		or another Subsidiary) or permit a Subsidiary to issue any additional shares of
		its capital stock except pro rata to its stockholders.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">7.11 </FONT><U><FONT
		STYLE="FONT-SIZE:10PT">ERISA</FONT></U><FONT STYLE="font-size:10pt">. (i)
		Terminate any Plan so as to result in any material liability to the Pension
		Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of
		ERISA (the &#147;PBGC&#148;), (ii) engage in or permit any person to engage in
		any &#147;prohibited transaction&#148; (as defined in Section 406 of ERISA or
		Section 4975 of the Internal Revenue Code of 1954, as amended) involving any
		Plan which would subject the Borrower to any material tax, penalty or other
		liability, (iii) incur or suffer to exist any material &#147;accumulated
		funding deficiency&#148; (as defined in Section 302 of ERISA), whether or not
		waived, involving any Plan, or (iv) allow or suffer to exist any event or
		condition, which presents a material risk of incurring a material liability to
		the PBGC by reason of termination of any Plan.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">7.12 </FONT><U><FONT
		STYLE="font-size:10pt">Accounting Changes</FONT></U><FONT
		STYLE="font-size:10pt">. Make, or permit any Subsidiary to make any change in
		its accounting treatment or financial reporting practices except as required or
		permitted by GAAP in effect from time to time.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">7.13 </FONT><U><FONT
		STYLE="font-size:10pt">Transactions with Affiliates</FONT></U><FONT
		STYLE="font-size:10pt">. Except as otherwise specifically set forth in this
		Agreement, directly or indirectly purchase, acquire or lease any property from,
		or sell, transfer or lease any property to, or enter into any other
		transaction, with any Affiliate except in the ordinary course of business and
		at prices and on terms not less favorable to it than those which would have
		been obtained in an arm&#146;s-length transaction with a non-affiliated third
		party.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">7.14 </FONT><U><FONT
		STYLE="font-size:10pt">Change of Control</FONT></U><FONT
		STYLE="font-size:10pt">. Without the prior written consent of the Bank, suffer
		or permit a Change of Control Transaction, as hereinafter defined. Change of
		Control Transaction means the occurrence after the date hereof of any of the
		following: (i) an acquisition after the date hereof by an individual or legal
		entity or &#147;group&#148; (as described in Rule 13d-5(b)(1) promulgated under
		the Exchange Act) of effective control (whether through legal or beneficial
		ownership of capital stock of the Borrower, by contract or otherwise) of in
		excess of 49.99% of the voting securities of the Borrower, or (ii) the Borrower
		merges into or consolidates with any other Person, or any Person merges into or
		consolidates with the Borrower and, after giving effect to such transaction,
		the stockholders of the Borrower immediately prior to such transaction own less
		than a majority of the aggregate voting power of the Borrower or the successor
		entity of such transaction, or (iii) the Borrower sells or transfers all or
		substantially all of its assets to another Person and the stockholders of the
		Borrower immediately prior to such transaction own less than a majority of the
		aggregate voting power of the acquiring entity immediately after the
		transaction, or (iv) a replacement at one time or within a two year period of
		more than one-half of the members of the Borrower&#146;s board of directors
		which is not approved by a majority of those individuals who are members of the
		board of directors on the date hereof (or by those individuals who are serving
		as members of the board of directors on any date whose nomination to the board
		of directors was approved by a majority of the </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-22-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">members of the board of directors who are
		members on the date hereof), or (v) the execution by the Borrower of an
		agreement to which the Borrower is a party or by which it is bound, providing
		for any of the events set forth in clauses (i) through (iv) above.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:center;">
		<FONT STYLE="FONT-SIZE:10PT">SECTION 8. </FONT><U><FONT
		STYLE="FONT-SIZE:10PT">EVENTS OF DEFAULT</FONT></U><FONT
		STYLE="font-size:10pt">.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">Upon the occurrence and during the
		continuance of any of the following events (each an &#147;Event of
		Default&#148;):</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(a) The Borrower shall fail to pay any
		interest on or principal of the Revolving Credit Note when due or shall fail to
		pay any other amount payable hereunder; or the Borrower or any Guarantor shall
		default beyond any applicable notice or cure period, if any) under any other
		Loan Document; or</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(b) Any representation or warranty made or
		deemed made by the Borrower or a Guarantor herein or which is contained in any
		Loan Document, certificate, document or financial or other statement furnished
		at any time under or in connection with this Agreement shall prove to have been
		false in any material respect on or as of the date made or deemed made;
		or</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(c) The Borrower shall default in the
		observance or performance of any covenant or provision contained in Sections
		5.1, 6 (inclusive) or 7 (inclusive) hereof; or</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(d) The Borrower shall default in the
		observance or performance of any other provision contained in this Agreement
		and such default shall continue unremedied for a period of twenty (20) days
		after written notice thereof is given to the Borrower by the Bank, unless such
		provision cannot be reasonably cured within such period provided that Borrower
		commence such cure promptly after discovery and diligently prosecute same
		thereafter; or</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(e) Any Specified Person shall (i) default
		in any payment of any indebtedness for borrowed money in excess of $100,000.00,
		individually or in the aggregate, (other than the Revolving Credit Note) beyond
		the period of grace, if any, provided in the instrument or agreement under
		which such indebtedness was created; or (ii) default in the observance or
		performance of any other agreement or condition relating to any such
		indebtedness or contained in any instrument or agreement evidencing, securing
		or relating thereto or any other event shall occur or condition exist, in each
		case the effect of which default or other event or condition is to cause or
		permit the holder or holders of such indebtedness (or a trustee or agent on
		behalf of such holder or holders) to cause such indebtedness to become due
		prior to its stated maturity; or</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(f) (i) Any Specified Person shall commence
		any case, proceeding or other action (A) under any existing or future law of
		any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
		reorganization or relief of debtors, seeking to have an order for relief
		entered with respect to it, or seeking to adjudicate it a bankrupt or
		insolvent, or seeking reorganization, arrangement, adjustment, winding-up,
		liquidation, dissolution, composition or other relief with respect to it or its
		debts, or (B) seeking appointment of a receiver, trustee, custodian or other
		similar official for it or for all or any substantial part of its assets, or
		any Specified Person shall make a general assignment for the benefit of its
		creditors; or (ii) there shall be commenced against any Specified Person any
		case, proceeding or other action of a nature referred to in clause (i) above
		which (A) results in the entry of an order for relief or any such adjudication
		or appointment or (B) remains undismissed, undischarged or unbonded for a
		period of 60 days; or (iii) there shall be commenced against any </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-23-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">Specified Person any case, proceeding or
		other action seeking issuance of a warrant of attachment, execution, distraint
		or similar process against all or any substantial part of its assets which
		results in the entry of any order for any such relief which shall have not been
		vacated, discharged, or stayed or bonded pending appeal within 20 days from the
		entry thereof; or (iv) any Specified Person shall take any action in
		furtherance of, or indicate its consent to, approval of, or acquiescence in,
		any of the acts set forth in clause (i), (ii) or (iii) of this Section 8(f); or
		(v) any Specified Person shall admit in writing its inability to, pay its debts
		as they become due; or</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(g) (i) any Specified Person shall engage in
		any &#147;prohibited transaction&#148; (as defined in Section 406 of ERISA or
		Section 4975 of the Code) involving any Plan, (ii) any &#147;accumulated
		funding deficiency&#148; (as defined in Section 302 of ERISA), whether or not
		waived, shall exist with respect to any Plan, (iii) a Reportable Event shall
		occur with respect to, or proceedings shall commence to have a trustee
		appointed, or a trustee shall be appointed, to administer or to terminate, any
		Plan, which Reportable Event or institution of proceedings is, in the
		reasonable opinion of the Bank, likely to result in the termination of such
		Plan for purposes of Title IV of ERISA, and, in the case of a Reportable Event,
		the continuance of such Reportable Event unremedied for 10 days after notice of
		such Reportable Event pursuant to Section 4043(a), (c) or (d) of ERISA is given
		or the continuance of such proceedings for 10 days after commencement thereof,
		as the case may be, (iv) any Plan shall terminate for purposes of Title IV of
		ERISA, and in each case in clauses (i) through (iv) above, such event or
		condition could subject the Borrower to any tax, penalty or other liabilities
		in the aggregate material in relation to the business, operations or property
		of the Borrower; or</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(h) the rendition by any court of a final
		judgment in excess of $100,000.00 against any Specified Person which shall not
		be satisfactorily stayed, discharged, vacated or set aside within thirty (30)
		days of the making thereof; or the attachment of (or enforcement proceeding
		with respect to) any property of any Specified Person which has not been
		released or provided for to the reasonable satisfaction of the Bank within
		thirty (30) days after the making therefor; or</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(i) any Loan Document shall cease to be in
		full force and effect, a default (after the expiration of any applicable grace
		period, if any, or the giving of notice, if required, or both) shall occur
		thereunder, any lien created thereby shall fail to be valid, perfected, or
		maintain its proper lien priority in accordance herewith, or any party thereto
		shall assert that it has no further obligation thereunder; or</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:10%;text-align:left;">
		<FONT STYLE="font-size:10pt">(j) the Bank shall have determined in its
		commercially reasonable discretion that one or more conditions exist or events
		have occurred which have resulted in a material adverse change in the business,
		properties or financial condition of the Borrower;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">then, in any such event, any or all of the
		following actions may be taken: (i) the Bank may, at its option, declare the
		Commitment to be terminated forthwith, whereupon the Commitment and all
		obligations to the Bank to make Revolving Credit Loans shall immediately
		terminate; and (ii) the Bank may, at its option, declare the Revolving Credit
		Loans hereunder (with accrued interest </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-24-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">thereon) and all other amounts owing under
		this Agreement and the Revolving Credit Note to be due and payable and the
		same, and all interest accrued thereon, shall forthwith become due and payable
		without presentment, demand, protest or notice of any kind (other than any
		notice specified herein), all of which are hereby waived, anything contained
		herein or in any instrument evidencing the Revolving Credit Loans to the
		contrary notwithstanding.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:center;">
		<FONT STYLE="FONT-SIZE:10PT">SECTION 9. </FONT><U><FONT
		STYLE="FONT-SIZE:10PT">COLLATERAL SECURITY</FONT></U>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">9.1 </FONT><U><FONT
		STYLE="font-size:10pt">General Loan and Collateral Agreement</FONT></U><FONT
		STYLE="font-size:10pt">. The Borrower hereby grants to the Bank a lien,
		security interest and a right of setoff as security for the payment of any and
		all sums owing under the Loan Documents and all other obligations, direct or
		contingent, joint, several or independent, of the Borrower now or hereafter
		existing due or to become due to, or held or to be held by the Bank, whether
		created directly or acquired by assignment or otherwise including, without
		limitation, any arising under this Agreement (all of such obligations being
		hereinafter collectively called the &#147;Obligations&#148;), upon and against
		all deposits, credits, collateral and property, now or hereafter in the
		possession, custody, safekeeping or control of the Bank or any entity under the
		control of the Bank, or in transit to any of them. At any time, after the
		occurrence and continuance of an Event of Default, without demand or notice,
		the Bank may set off the same or any part thereof and apply the same to any
		liability or obligation of the Borrower even though unmatured and regardless of
		the adequacy of any other collateral securing the Revolving Credit Loans. ANY
		AND ALL RIGHTS TO REQUIRE THE BANK TO EXERCISE ITS RIGHTS OR REMEDIES WITH
		RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE REVOLVING CREDIT LOANS PRIOR
		TO EXERCISING ITS RIGHT OF SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR
		OTHER PROPERTY OF THE BORROWER OR ANY GUARANTOR, ARE HEREBY KNOWINGLY,
		VOLUNTARILY AND IRREVOCABLE WAIVED. The Bank shall not be required to marshal
		any present or future security for, or guarantees of, the obligations or to
		resort to any such security or guarantee in any particular order and the
		Borrower waives, to the fullest extent that it lawfully can, (a) any right they
		might have to require to the Bank to pursue any particular remedy before
		proceeding against them and (b) any right to the benefit of, or to direct the
		application of the proceeds of any collateral until the obligations are paid in
		full.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">9.2 </FONT><U><FONT
		STYLE="font-size:10pt">Additional Collateral Security</FONT></U><FONT
		STYLE="font-size:10pt">. In addition to the collateral described in Section 9.1
		hereof, payment of the Obligations is also secured by, </FONT><U><FONT
		STYLE="font-size:10pt">inter</FONT></U><FONT STYLE="font-size:10pt">
		</FONT><U><FONT STYLE="font-size:10pt">alia</FONT></U><FONT
		STYLE="font-size:10pt">, (a) a first priority security interest in all personal
		property of the Borrower, whether now owned or hereafter acquired, to the
		extent provided in the Security Agreement executed and delivered by the
		Borrower to the Bank, and (b) all right, title and interest of the Borrower in
		and to its cash and marketable securities accounts with the Bank, together with
		all property contained therein and all proceeds of the foregoing in whatever
		form received, in each case whether now owned or hereafter acquired.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:center;">
		<FONT STYLE="FONT-SIZE:10PT">SECTION 10. </FONT><U><FONT
		STYLE="FONT-SIZE:10PT">MISCELLANEOUS</FONT></U><FONT
		STYLE="font-size:10pt">.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.1 </FONT><U><FONT
		STYLE="font-size:10pt">Notices</FONT></U><FONT STYLE="font-size:10pt">. All
		notices, requests and demands to or upon the respective parties hereto to be
		effective shall be in writing unless otherwise expressly provided herein and
		shall be deemed to have been duly given or made when delivered by hand, or
		telecopy, or when deposited in the mail addressed as follows, or to such
		address as may be hereafter notified in writing by the respective parties
		hereto and any future holders of the Revolving Credit Note:</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-25-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" margin-left:51.85pt;border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="19%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">The Borrower:</FONT>
				</P>
			 </TD>
			 <TD WIDTH="4%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="75%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">CPI Aerostructures, Inc.</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">60 Heartland Boulevard</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Edgewood, New York 11717</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Attn: Mr.&nbsp;Vincent
				  Palazzolo</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT
					STYLE="font-size:10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chief
				  Financial Officer</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">with a copy to:</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Graubard Miller</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">405 Lexington Avenue, 19th
				  Floor</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">New York, New York 10174</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Attn: Marci Frankenthaler,
				  Esq.</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">The Bank:</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Sovereign Bank</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">3 Huntington Quadrangle</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Suite 101 North and 103 South</FONT>

				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Melville, New York 11747</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Attn: Ms.&nbsp;Christine
				  Gerula</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT
					STYLE="font-size:10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Senior
				  Vice President</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:0pt; text-indent:46%;text-align:justify;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.2 </FONT><U><FONT
		STYLE="font-size:10pt">No Waiver; Cumulative Remedies</FONT></U><FONT
		STYLE="font-size:10pt">. No failure to exercise and no delay in exercising, on
		the part of the Bank, any right, remedy, power or privilege hereunder shall
		operate as a waiver thereof; nor shall any single or partial exercise of any
		right, remedy, power or privilege hereunder preclude any other or further
		exercise thereof or the exercise of any other right.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.3 </FONT><U><FONT
		STYLE="font-size:10pt">Survival of Representations and
		Warranties</FONT></U><FONT STYLE="font-size:10pt">. All representations and
		warranties made hereunder and in any document, certificate or statement
		delivered pursuant hereto or in connection herewith shall survive the execution
		and delivery of this Agreement and the Revolving Credit Note.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.4 </FONT><U><FONT
		STYLE="font-size:10pt">Payment of Expenses; Examination</FONT></U><FONT
		STYLE="font-size:10pt">. The Borrower agrees to pay or reimburse the Bank for
		all its costs and expenses incurred in connection with (a) the preparation of
		the Loan Documents and the closing of the transactions described by the Loan
		Documents, (b) the enforcement or preservation of any rights under this
		Agreement or the Loan Documents or any other instrument or agreement entered
		into in connection herewith or therewith including, without limitation, the
		reasonable fees and disbursements of attorneys for the Bank (which may include,
		without limitation, the allocable cost of the Bank&#146;s internal legal
		counsel), and (c) any claim or action threatened, made or brought against the
		Bank arising out of or relating to any extent to this Agreement, or any Loan
		Documents or any instrument or agreement entered into in connection with the
		transactions contemplated hereby or thereby if the Bank prevails in any such
		action or proceeding or the Borrower makes payment to the Bank on account of
		any sums demanded by it prior to the disposition of any such action or
		proceeding or in settlement thereof.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.5 </FONT><U><FONT
		STYLE="FONT-SIZE:10PT">WAIVER OF JURY TRIAL; SET-OFF AND
		COUNTERCLAIM</FONT></U><FONT STYLE="font-size:10pt">. THE BORROWER AND THE BANK
		MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A
		TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED HEREON, ARISING OUT OF, UNDER OR IN
		CONNECTION WITH THIS AGREEMENT OR ANY LOAN DOCUMENTS OR ANY COURSE OF CONDUCT,
		COURSE OF </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-26-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="FONT-SIZE:10PT">DEALING, STATEMENTS (WHETHER VERBAL OR IN
		WRITING) OR ACTIONS OF ANY PARTY. THE BORROWER WAIVES THE RIGHT TO INTERPOSE
		ANY SET-OFF OR COUNTERCLAIM OF ANY KIND OR DESCRIPTION IN ANY SUCH LITIGATION.
		THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR THE BANK TO ACCEPT THIS
		AGREEMENT AND MAKE THE REVOLVING CREDIT LOANS.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.6 </FONT><U><FONT
		STYLE="FONT-SIZE:10PT">WAIVER OF AUTOMATIC STAY</FONT></U><FONT
		STYLE="font-size:10pt">. THE BORROWER AGREES THAT, IN THE EVENT THAT THE
		BORROWER, ANY GUARANTOR OR ANY OF THE PERSONS OR PARTIES CONSTITUTING THE
		BORROWER OR A GUARANTOR SHALL (i) FILE WITH ANY BANKRUPTCY COURT OF COMPETENT
		JURISDICTION OR BE THE SUBJECT OF ANY PETITION UNDER TITLE 11 OF THE U.S. CODE,
		AS AMENDED (&#147;BANKRUPTCY CODE&#148;), (ii) BE THE SUBJECT OF ANY ORDER FOR
		RELIEF ISSUED UNDER THE BANKRUPTCY CODE, (iii) FILE OR BE THE SUBJECT OF ANY
		PETITION SEEKING ANY REORGANIZATION, ARRANGEMENT, COMPOSITION, READJUSTMENT,
		LIQUIDATION, DISSOLUTION, OR SIMILAR RELIEF UNDER ANY PRESENT OR FUTURE FEDERAL
		OR STATE ACT OR LAW RELATING TO BANKRUPTCY, INSOLVENCY, OR OTHER RELIEF FOR
		DEBTORS, (iv) HAVE SOUGHT OR CONSENT TO OR ACQUIESCED IN THE APPOINTMENT OF ANY
		TRUSTEE, RECEIVER, CONSERVATOR, OR LIQUIDATOR, OR (v) BE THE SUBJECT OF ANY
		ORDER, JUDGMENT, OR DECREE ENTERED BY ANY COURT OF COMPETENT JURISDICTION
		APPROVING A PETITION FILED AGAINST SUCH PARTY FOR ANY REORGANIZATION,
		ARRANGEMENT, COMPOSITION, READJUSTMENT, LIQUIDATION, DISSOLUTION, OR SIMILAR
		RELIEF UNDER ANY PRESENT OR FUTURE FEDERAL OR STATE ACT OR LAW RELATING TO
		BANKRUPTCY, INSOLVENCY, OR RELIEF TO DEBTORS, THE BANK SHALL THEREUPON BE
		ENTITLED AND THE BORROWER IRREVOCABLY CONSENTS TO IMMEDIATE AND UNCONDITIONAL
		RELIEF FROM ANY AUTOMATIC STAY IMPOSED BY SECTION 362 OF THE BANKRUPTCY CODE,
		OR OTHERWISE, ON OR AGAINST THE EXERCISE OF THE RIGHTS AND REMEDIES OTHERWISE
		AVAILABLE TO THE BANK AS PROVIDED FOR HEREIN, IN THE REVOLVING CREDIT NOTE,
		OTHER LOAN DOCUMENTS DELIVERED IN CONNECTION HEREWITH AND AS OTHERWISE PROVIDED
		BY LAW, AND THE BORROWER HEREBY IRREVOCABLY WAIVES ANY RIGHT TO OBJECT TO SUCH
		RELIEF AND WILL NOT CONTEST ANY MOTION BY THE BANK SEEKING RELIEF FROM THE
		AUTOMATIC STAY AND THE BORROWER WILL COOPERATE WITH THE BANK, IN ANY MANNER
		REQUESTED BY THE BANK, IN ITS EFFORTS TO OBTAIN RELIEF FROM ANY SUCH STAY OR
		OTHER PROHIBITION.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.7 </FONT><U><FONT
		STYLE="font-size:10pt">Modification and Waiver</FONT></U><FONT
		STYLE="font-size:10pt">. No modification or waiver of, or with respect to any
		provision of this Agreement or any document or instrument delivered in
		connection therewith shall be effective unless and until it shall be in writing
		and signed by the Bank, and then such modification or waiver shall be effective
		only in the specific instance and for the purpose for which given. No notice to
		or demand on the Borrower in any case shall, of itself, entitle it to any other
		or further notice or demand in similar or other circumstances.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.8 </FONT><U><FONT
		STYLE="font-size:10pt">USA Patriot Act</FONT></U><FONT STYLE="font-size:10pt">.
		The Bank is subject to the requirements of the USA Patriot Act (Title III of
		Pub. L. 107-56 (signed into law October 26, 2001)) (the &#147;Act&#148;) and
		hereby notifies the Borrower that pursuant to the requirements of the Act, it
		is required to obtain, verify and record </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-27-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">information that identifies the Borrower,
		which information includes the name and address of the Borrower and other
		information that will allow the Bank to identify the Borrower in accordance
		with the Act.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.9 </FONT><U><FONT
		STYLE="font-size:10pt">Federal Reserve Bank</FONT></U><FONT
		STYLE="font-size:10pt">. The Bank may at any time pledge, endorse, assign, or
		transfer all or any portion of its rights under the Loan Documents including
		any portion of the Revolving Credit Note to any of the twelve (12) Federal
		Reserve Banks organized under Section 4 of the Federal Reserve Act. 12 U.S.C.
		Section 341. No such pledge or enforcement thereof shall release the Bank from
		its obligations under any of the Loan Documents. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.10 </FONT><U><FONT
		STYLE="font-size:10pt">Successor and Assigns</FONT></U><FONT
		STYLE="font-size:10pt">. This Agreement shall be binding upon and inure to the
		benefit of the Borrower, the Bank, all future holders of the Revolving Credit
		Note and their respective successors and assigns, except that the Borrower may
		not assign or transfer any of its rights under this Agreement without the prior
		written consent of the Bank. The term &#147;Bank&#148; as used herein shall be
		deemed to include the Bank and its successors, endorsees and assigns.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.11 </FONT><U><FONT
		STYLE="font-size:10pt">Governing Law; Consent to Jurisdiction</FONT></U><FONT
		STYLE="font-size:10pt">. This Agreement, the Loan Documents and any documents
		and instruments delivered in connection herewith and therewith and the rights
		and duties of the parties hereunder and thereunder shall be governed by, and
		construed and interpreted in accordance with, the law of the State of New York
		and the Borrower consents to the jurisdiction of the courts of the State of New
		York in any action brought to enforce any rights of the Bank under this
		Agreement and any document or instrument related hereto.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.12 </FONT><U><FONT
		STYLE="font-size:10pt">Entire Agreement</FONT></U><FONT
		STYLE="font-size:10pt">. This Agreement and any other agreements, documents and
		instruments executed and delivered pursuant to or in connection with the
		Obligations contain the entire agreement between the parties relating to the
		subject matter hereof and thereof. The Borrower expressly acknowledges that the
		Bank has not made and the Borrower is not relying on any oral representations,
		agreements or commitments of the Bank or any officer, employee, agent or
		representative thereof.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.13 </FONT><U><FONT
		STYLE="font-size:10pt">Interest Adjustment</FONT></U><FONT
		STYLE="font-size:10pt">. Notwithstanding anything to the contrary contained in
		this Agreement or the Revolving Credit Note, the rate of interest payable on
		the Revolving Credit Note shall never exceed the maximum rate of interest
		permitted under applicable law. If at any time the rate of interest otherwise
		prescribed herein shall exceed such maximum rate, and such prescribed rate is
		thereafter below such maximum rate, the prescribed rate shall be increased to
		the maximum rate for such period of time as is required so that the total
		amount of interest received by the Bank is that which would have been received
		by the Bank except for the operation of the first sentence of this Section
		10.13.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.14 </FONT><U><FONT
		STYLE="font-size:10pt">Errors and Omissions</FONT></U><FONT
		STYLE="font-size:10pt">. The Borrower hereby consents and agrees that in the
		event any of the documents evidencing and/or securing the Revolving Credit
		Loans misstate or inaccurately reflect the true and correct terms and
		provisions of the Revolving Credit Loans and said misstatement or inaccuracy is
		due to the unilateral mistake on the part of the Bank, mutual mistake on the
		part of the Bank and the Borrower or clerical error, then in such event the
		Borrower shall, upon request of the Bank and in order to correct such
		misstatement or inaccuracy, execute such new documents as the Bank may deem
		necessary to remedy said inaccuracy or mistake, provided </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-28-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">however, such obligation on behalf of the
		Borrower shall not extend to the execution of any new or redrafted document
		which materially and adversely adds to or changes the obligations of the
		Borrower beyond those set forth in or contemplated by the terms hereof. The
		Borrower agrees to execute all such other and further documents as may or shall
		be reasonably necessary, as determined solely by the Bank, in order to give
		effect to the documents executed (whether in connection with the Revolving
		Credit Loans or any future loan) and so as to confirm the transaction
		(&#147;Additional Documents&#148;). The Borrower agrees to comply with the
		reasonable requirements of the Bank within ten (10) days after written notice.
		Upon the Borrower failing or refusing to comply with the terms and provisions
		of this Section, such failure shall constitute a default by the Borrower under
		this Agreement and thereupon, the Bank shall have all of the rights and
		remedies against the Borrower as otherwise specified in this Agreement and
		other documents by reason of a default.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.15 </FONT><U><FONT
		STYLE="font-size:10pt">Replacement Documents</FONT></U><FONT
		STYLE="font-size:10pt">. Upon receipt of an affidavit of an officer of the Bank
		as to the loss, theft, destruction or mutilation of the Revolving Credit Note,
		any Loan Document or any other security document(s) which is not of public
		record and, in the case of any such destruction or mutilation, upon surrender
		and cancellation of the Revolving Credit Note, any Loan Document or other
		document(s) (collectively, the &#147;Replacement Documents&#148;), the Borrower
		will issue, in lieu thereof, a replacement note or other document(s) in the
		same principal amount thereof and otherwise of like tenor.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.16 </FONT><U><FONT
		STYLE="font-size:10pt">Participations</FONT></U><FONT STYLE="font-size:10pt">.
		The Bank shall have the unrestricted right at any time and from time to time,
		and without the consent of or notice to the Borrower (or any Guarantor), to
		grant to one or more institutions or other persons (each a
		&#147;Participant&#148;) participation interests in the Bank&#146;s obligations
		to lend hereunder and/or any or all of the loans held by the Bank hereunder. In
		the event of any such grant by the Bank of a participating interest to a
		Participant, whether or not upon notice to the Borrower, the Bank shall remain
		responsible for the performance of its obligations hereunder and the Borrower
		shall continue to deal solely and directly with the Bank in connection with the
		Bank&#146;s rights and obligations hereunder. The Bank may furnish any
		information concerning the Borrower in its possession from time to time to any
		prospective assignees and Participants, provided that the Bank shall require
		any such prospective assignee or Participant to maintain the confidentiality of
		such information.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">10.17 </FONT><U><FONT
		STYLE="font-size:10pt">Counterparts</FONT></U><FONT STYLE="font-size:10pt">.
		This Agreement may be signed in any number of counterparts with the same effect
		as if the signatures thereto and hereto were upon the same instrument.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">IN WITNESS WHEREOF, the parties hereto have
		caused this agreement to be duly executed and delivered in Melville, New York
		by their proper and duly authorized officer as of the day and year first above
		written.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <DIV ALIGN="center">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD COLSPAN="2" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="FONT-SIZE:10PT">CPI AEROSTRUCTURES, INC.</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD WIDTH="49%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				</P>
			 </TD>
			 <TD WIDTH="7%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="4%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">By:&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="40%" VALIGN="bottom"
			  STYLE="border-bottom: solid black .5pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <BR> <FONT STYLE="font-size:10pt">/s/ Vincent Palazzolo</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Vincent Palazzolo </FONT><BR>
				  <FONT STYLE="font-size:10pt">Chief Financial Officer</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-29-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <DIV ALIGN="center">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD COLSPAN="2" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="FONT-SIZE:10PT">SOVEREIGN BANK</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD WIDTH="49%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				</P>
			 </TD>
			 <TD WIDTH="7%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="4%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">By:&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="40%" VALIGN="bottom"
			  STYLE="border-bottom: solid black .5pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <BR> <FONT STYLE="font-size:10pt">/s/ Christine Gerula</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Christine Gerula </FONT><BR>
				  <FONT STYLE="font-size:10pt">Senior Vice President</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">-30-</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <P STYLE=" margin-bottom:0pt; margin-top:16pt;text-align:center;">
		<U><B><FONT STYLE="FONT-SIZE:10PT">EXHIBIT A</FONT></B></U>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<U><B><FONT STYLE="FONT-SIZE:10PT">FORM OF REVOLVING CREDIT
		NOTE</FONT></B></U>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<U><B><FONT STYLE="FONT-SIZE:10PT">REVOLVING CREDIT NOTE</FONT></B></U>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="28%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt"><A
				  NAME="tabdatabeginip"></A>$2,500,000.00</FONT>
				</P>
			 </TD>
			 <TD WIDTH="38%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Melville, New York</FONT>
				</P>
			 </TD>
			 <TD WIDTH="32%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">August 13, 2007</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">CPI AEROSTRUCTURES, INC., a New York
		corporation (the &#147;Borrower&#148;), for value received, hereby promises to
		pay to the order of SOVEREIGN BANK (the &#147;Bank&#148;) on the Termination
		Date (as such term is defined in the Agreement), at the office of the Bank
		specified in Section 10.1 of the Credit Agreement dated as of August 13, 2007,
		between the Borrower and the Bank, as amended from time to time (as so amended,
		the &#147;Agreement&#148;; terms defined in the Agreement shall have their
		defined meanings when used in this Note), in lawful money of the United States
		of America and in immediately available funds the principal amount of TWO
		MILLION FIVE HUNDRED THOUSAND AND 00/100 ($2,500,000.00) DOLLARS or, if less
		than such principal amount, the aggregate unpaid principal amount of all
		Revolving Credit Loans made by the Bank to the Borrower pursuant to Section 2.1
		of the Agreement. The Borrower further promises to pay interest at said office
		in like money on the unpaid principal balance of this Note from time to time
		outstanding at an annual rate as selected by the Borrower pursuant to the terms
		of Section 2 (inclusive) of the Agreement. Interest shall be computed on the
		basis of a 360-day year for actual days elapsed and shall be payable as
		provided in the Agreement. All Loans made by the Bank pursuant to subsection
		2.1 of the Agreement and payments of the principal thereon may be endorsed by
		the holder of this Note on the schedule annexed hereto, to which the holder may
		add additional pages. The aggregate net unpaid amount of Revolving Credit Loans
		set forth in such schedule shall be presumed to be the principal balance
		hereof. After the stated or any accelerated maturity hereof, this Note shall
		bear interest at a rate as set forth in the Agreement, payable on demand, but
		in no event in excess of the maximum rate of interest permitted under
		applicable law.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">This Note is the Revolving Credit Note
		referred to in the Agreement, and is entitled to the benefits thereof and may
		be prepaid, and is required to be prepaid, in whole or in part (subject to the
		indemnity provided in the Agreement) as provided therein. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">Upon the occurrence of any one or more of
		the Events of Default specified in the Agreement, all amounts then remaining
		unpaid on this Note may be declared to be immediately due and payable as
		provided in the Agreement.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; text-indent:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">This Note shall be construed in accordance
		with and governed by the laws of the State of New York.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="49%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="5%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="44%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="FONT-SIZE:10PT">CPI AEROSTRUCTURES, INC.</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:0pt; margin-left:53%; text-indent:-54%;text-align:center;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<FONT STYLE="font-size:10pt">Exhibit A</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <P STYLE=" margin-bottom:0pt; margin-top:16pt;text-align:center;">
		<B><FONT STYLE="FONT-SIZE:10PT">SCHEDULE OF LOANS AND PAYMENT OF
		PRINCIPAL</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<B><FONT STYLE="FONT-SIZE:10PT">TO REVOLVING CREDIT NOTE DATED AS OF
		AUGUST 13, 2007</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<B><FONT STYLE="FONT-SIZE:10PT">BY</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<B><FONT STYLE="FONT-SIZE:10PT">CPI AEROSTRUCTURES, INC.</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<B><FONT STYLE="FONT-SIZE:10PT">TO</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:center;">
		<B><FONT STYLE="FONT-SIZE:10PT">SOVEREIGN BANK</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:16pt;text-align:center;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="98%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:center; margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Date</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center; margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Amount <BR> of Loan</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Interest</FONT><BR>
				  <FONT STYLE="font-size:10pt">Rate</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Last Day </FONT><BR>
				  <FONT STYLE="font-size:10pt">of Interest Period</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Balance Principal Paid</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Remaining <BR> Unpaid</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Notation <BR> Made By</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD WIDTH="12%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="12%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="12%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="12%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="12%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="12%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="12%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>

	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="98%"
		 ALIGN="center">
		  <TR>
			 <TD WIDTH="12%" VALIGN="bottom"
			  STYLE="border:solid black .5pt; border-right:none;">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom"
			  STYLE="border-top:solid black .5pt; border-left:none;border-bottom:solid black .5pt;border-right:none; ">

				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="12%" VALIGN="bottom"
			  STYLE="border-top:solid black .5pt; border-left:none;border-bottom:solid black .5pt;border-right:none; ">

				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom"
			  STYLE="border-top:solid black .5pt; border-left:none;border-bottom:solid black .5pt;border-right:none; ">

				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="12%" VALIGN="bottom"
			  STYLE="border-top:solid black .5pt; border-left:none;border-bottom:solid black .5pt;border-right:none; ">

				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom"
			  STYLE="border-top:solid black .5pt; border-left:none;border-bottom:solid black .5pt;border-right:none; ">

				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="12%" VALIGN="bottom"
			  STYLE="border-top:solid black .5pt; border-left:none;border-bottom:solid black .5pt;border-right:none; ">

				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom"
			  STYLE="border-top:solid black .5pt; border-left:none;border-bottom:solid black .5pt;border-right:none; ">

				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
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			  STYLE="border-top:solid black .5pt; border-left:none;border-bottom:solid black .5pt;border-right:none; ">

				<P
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				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
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			  STYLE="border-top:solid black .5pt; border-left:none;border-bottom:solid black .5pt;border-right:none; ">

				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
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			  STYLE="border-top:solid black .5pt; border-left:none;border-bottom:solid black .5pt;border-right:none; ">

				<P
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				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom"
			  STYLE="border-top:solid black .5pt; border-left:none;border-bottom:solid black .5pt;border-right:none; ">

				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="12%" VALIGN="bottom"
			  STYLE="border-top:solid black .5pt; border-left:none;border-bottom:solid black .5pt;border-right:none; ">

				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom"
			  STYLE="border:solid black .5pt; border-left:none;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom"
			  STYLE="border-top:none; border-bottom:solid black .5pt; border-right:none; border-left: solid black .5pt">

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				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
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				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: solid black .5pt;">
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				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
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		<FONT STYLE="font-size:10pt">Exhibit A</FONT>
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<DOCUMENT>
<TYPE>EX-10.28
<SEQUENCE>3
<FILENAME>file3.htm
<DESCRIPTION>SECURITY AGREEMENT
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		<B><FONT STYLE="FONT-SIZE:10PT">COMMERCIAL SECURITY AGREEMENT</FONT></B>
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		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
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			 <TD WIDTH="30%" VALIGN="top"
			  STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="top"
			  STYLE="border-bottom:double black 2.25pt; ">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="7%" VALIGN="top"
			  STYLE="border-bottom:double black 2.25pt; ">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom"
			  STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="44%" VALIGN="top"
			  STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="top" STYLE="border-bottom:double black 2.25pt; ">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Grantor:</FONT></B>
				</P>
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top" STYLE="border-bottom:double black 2.25pt; ">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top" STYLE="border-bottom: double black 2.25pt; ">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">CPI Aerostructures,
				  Inc.</FONT></B><BR> <B><FONT STYLE="font-size:10pt">60 Heartland
				  Boulevard</FONT></B><BR> <B><FONT STYLE="font-size:10pt">Edgewood, New York
				  11717</FONT></B>
				</P>
			 </TD>
			 <TD VALIGN="top" STYLE="border-bottom:double black 2.25pt; ">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top" STYLE="border-bottom:double black 2.25pt; ">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Lender:</FONT></B>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt; ">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top" STYLE="border-bottom: double black 2.25pt; ">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Sovereign Bank</FONT></B><BR>
				  <B><FONT STYLE="font-size:10pt">Commercial Lending</FONT></B><BR> <B><FONT
				  STYLE="font-size:10pt">3 Huntington Quadrangle</FONT></B><BR> <B><FONT
				  STYLE="font-size:10pt">Suite 101 North and 103 South</FONT></B><BR> <B><FONT
				  STYLE="font-size:10pt">Melville, New York 11747</FONT></B>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:8.65pt;text-indent:-8.65pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:12pt;text-align:left;">
		<B><FONT STYLE="font-size:10pt">THIS COMMERCIAL SECURITY AGREEMENT dated
		August 13, 2007 is made and executed between CPI Aerostructures, Inc.
		(&#147;Grantor&#148;); and Sovereign Bank (&#147;Lender&#148;).</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:12pt;text-align:left;">
		<B><FONT STYLE="font-size:10pt">GRANT OF SECURITY INTEREST. For valuable
		consideration, Grantor grants to Lender a security interest in the Collateral
		to secure the Indebtedness and agrees that Lender shall have the rights stated
		in this Agreement with respect to the Collateral, in addition to all other
		rights which Lender may have by law.</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<B><FONT STYLE="FONT-SIZE:10PT">COLLATERAL DESCRIPTION.</FONT></B><FONT
		STYLE="font-size:10pt"> The word &#147;Collateral&#148; as used in this
		Agreement means the following described property, whether now owned or
		hereafter acquired, whether now existing or hereafter arising, and wherever
		located, in which Grantor is giving to Lender a security interest for the
		payment of the Indebtedness and performance of and other obligations under the
		Note and this Agreement:</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:12pt;text-align:left;">
		<B><FONT STYLE="font-size:10pt">All Inventory, Chattel Paper, Accounts,
		Equipment and General Intangibles and other Personal Property</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">In addition, the word &#147;Collateral&#148;
		also includes all the following, whether now owned or hereafter acquired,
		whether now existing or hereafter arising, and wherever located: </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">(A) All accessions, attachments,
		accessories, tools, parts, supplies, replacements of and additions to any of
		the collateral described herein, whether added now or later. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">(B) All products and produce of any of the
		property described in this Collateral section. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">(C) All accounts, general intangibles,
		instruments, rents, monies, payments, and all other rights, arising out of a
		sale, lease, consignment or other disposition of any of the property described
		in this Collateral section. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">(D) All proceeds (including insurance
		proceeds) from the sale, destruction, loss, or other disposition of any of the
		property described in this Collateral section, and sums due from a third party
		who has damaged or destroyed the Collateral or from that party&#146;s insurer,
		whether due to judgment, settlement or other process. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">(E) All records and data relating to any of
		the property described in this Collateral section, whether in the form of a
		writing, photograph, microfilm, microfiche, or </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="83%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <B><FONT STYLE="FONT-SIZE:10PT">COMMERCIAL SECURITY
				  AGREEMENT</FONT></B><BR> <B><FONT STYLE="font-size:10pt">(continued)
				  </FONT></B>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="14%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Page - 2 -</FONT></B>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">electronic media, together with all of
		Grantor&#146;s right, title, and interest in and to all computer software
		required to utilize, create, maintain, and process any such records or data on
		electronic media. </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<B><FONT STYLE="font-size:10pt">CROSS-COLLATERALlZATION.</FONT></B><FONT
		STYLE="font-size:10pt"> In addition to the Note, this Agreement secures all
		obligations, debts and liabilities, plus interest thereon, of Grantor to
		Lender, or any one or more of them, as well as all claims by Lender against
		Grantor or any one or more of them, whether now existing or hereafter arising,
		whether related or unrelated to the purpose of the Note, whether voluntary or
		otherwise, whether due or not due, direct or indirect, determined or
		undetermined, absolute or contingent, liquidated or unliquidated, whether
		Grantor may be liable individually or jointly with others, whether obligated as
		guarantor, surety, accommodation party or otherwise, and whether recovery upon
		such amounts may be or hereafter may become barred by any statute of
		limitations, and whether the obligation to repay such amounts may be or
		hereafter may become otherwise unenforceable. </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<B><FONT STYLE="FONT-SIZE:10PT">FUTURE ADVANCES.</FONT></B><FONT
		STYLE="font-size:10pt"> In addition to the Note, this Agreement secures all
		future advances made by Lender to Grantor regardless of whether the advances
		are made a) pursuant to a commitment or b) for the same purposes.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<B><FONT STYLE="font-size:10pt">GRANTOR&#146;S WAIVERS AND
		RESPONSIBILITIES.</FONT></B><FONT STYLE="font-size:10pt"> Except as otherwise
		required under this Agreement or by applicable law, (A) Grantor agrees that
		Lender need not tell Grantor about any action or inaction Lender takes in
		connection with this Agreement; (B) Grantor assumes the responsibility for
		being and keeping informed about the Collateral; and (C) Grantor waives any
		defenses that may arise because of any action or inaction of Lender, including
		without limitation any failure of Lender to realize upon the Collateral or any
		delay by Lender in realizing upon the Collateral; and Grantor agrees to remain
		liable under the Note no matter what action Lender takes or fails to take under
		this Agreement.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<B><FONT STYLE="font-size:10pt">GRANTOR&#146;S REPRESENTATIONS AND
		WARRANTIES.</FONT></B><FONT STYLE="font-size:10pt"> Grantor warrants that: (A)
		this Agreement is executed at Grantor&#146;s request and not at the request of
		Lender; (B) Grantor has the full right, power and authority to enter into this
		Agreement and to pledge the Collateral to Lender; (C) Grantor has established
		adequate means of obtaining from Grantor on a continuing basis information
		about Grantor&#146;s financial condition; and (D) Lender has made no
		representation to Grantor about Grantor or Grantor&#146;s creditworthiness.
		</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<B><FONT STYLE="font-size:10pt">GRANTOR&#146;S ADDITIONAL
		WAIVERS.</FONT></B><FONT STYLE="font-size:10pt"> Grantor waives all
		requirements of presentment, protest, demand, and notice of dishonor or
		non-payment to Grantor or any other party to the Indebtedness or the
		Collateral. Lender may do any of the following with respect to any obligation
		of Grantor without first obtaining the consent of Grantor: (A) grant any
		extension of time for any payment, (B) grant any renewal, (C) permit any
		modification of payment terms or other terms, or (D) exchange or release any
		Collateral or other security. No such act or failure to act shall affect
		Lender&#146;s rights against Grantor or the Collateral. </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="83%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <B><FONT STYLE="FONT-SIZE:10PT">COMMERCIAL SECURITY
				  AGREEMENT</FONT></B><BR> <B><FONT STYLE="font-size:10pt">(continued)
				  </FONT></B>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="14%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Page - 3 -</FONT></B>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<B><FONT STYLE="FONT-SIZE:10PT">RIGHT OF SETOFF</FONT></B><FONT
		STYLE="font-size:10pt">. To the extent permitted by applicable law, Lender
		reserves a right of setoff in all Grantor&#146;s accounts with Lender (whether
		checking, savings, or some other account and whether evidenced by a certificate
		of deposit). This includes all accounts Grantor holds jointly with someone else
		and all accounts Grantor may open in the future. However, this does not include
		any IRA or Keogh accounts, or any trust accounts for which setoff would be
		prohibited by law. Grantor authorizes Lender, to the extent permitted by
		applicable law, to charge or setoff all sums owing on the Indebtedness against
		any and all such accounts, and, at Lender&#146;s option, to administratively
		freeze all such accounts to allow Lender to protect Lender&#146;s charge and
		setoff rights provided in this paragraph. </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<B><FONT STYLE="font-size:10pt">GRANTOR&#146;S REPRESENTATIONS AND
		WARRANTIES WITH RESPECT TO THE COLLATERAL.</FONT></B><FONT
		STYLE="font-size:10pt"> With respect to the Collateral, Grantor represents and
		promises to Lender that: </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Perfection of Security
		Interest.</FONT></B><FONT STYLE="font-size:10pt"> Grantor agrees to take
		whatever actions are reasonably requested by Lender to perfect and continue
		Lender&#146;s security interest in the Collateral. Upon request of Lender,
		Grantor will deliver to Lender any and all of the documents evidencing or
		constituting the Collateral, and Grantor will note Lender&#146;s interest upon
		any and all chattel paper and instruments if not delivered to Lender for
		possession by Lender. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT
		STYLE="font-size:10pt">Notices to Lender. </FONT></B><FONT
		STYLE="font-size:10pt">Grantor will promptly notify Lender in writing at
		Lender&#146;s address shown above (or such other addresses as Lender may
		designate from time to time) prior to any (1) change in Grantor&#146;s name;
		(2) change in Grantor&#146;s assumed business name(s); (3) change in the
		management of any Corporation Grantor; (4) change in the authorized signer(s);
		(5) change in Grantor&#146;s principal office address; (6) change in
		Grantor&#146;s state of organization; (7) conversion of Grantor to a new or
		different type of business entity; or (8) change in any other aspect of Grantor
		that directly or indirectly relates to any agreements between Grantor and
		Lender. No change in Grantor&#146;s name or state of organization will take
		effect until after Lender has received notice. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">No Violation. </FONT></B><FONT
		STYLE="font-size:10pt">The execution and delivery of this Agreement will not
		violate any law or agreement governing Grantor or to which Grantor is a party,
		and its certificate or articles of incorporation and bylaws do not prohibit any
		term or condition of this Agreement. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Enforceability of Collateral.
		</FONT></B><FONT STYLE="font-size:10pt">To the extent the Collateral consists
		of accounts, chattel paper, or general intangibles, as defined by the Uniform
		Commercial Code, the Collateral is enforceable in accordance with its terms, is
		genuine, and fully complies with all applicable laws and regulations concerning
		form, content and manner of preparation and execution, and all persons
		appearing to be obligated on the Collateral have authority and capacity to
		contract and are in fact obligated as they appear to be on the Collateral. At
		the time any account becomes subject to a security interest in favor of Lender,
		the account shall be a good and valid account representing an undisputed, bona
		fide indebtedness incurred by the account debtor, for merchandise held subject
		to delivery instructions or previously shipped or delivered pursuant to a
		contract of sale, or for services previously </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="83%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <B><FONT STYLE="FONT-SIZE:10PT">COMMERCIAL SECURITY
				  AGREEMENT</FONT></B><BR> <B><FONT STYLE="font-size:10pt">(continued)
				  </FONT></B>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="14%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Page - 4 -</FONT></B>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">performed by Grantor with or for the account
		debtor. So long as this Agreement remains in effect, Grantor shall not, without
		Lender&#146;s prior written consent, compromise, settle, adjust, or extend
		payment under or with regard to any such Accounts. There shall be no setoffs or
		counterclaims against any of the Collateral, and no agreement shall have been
		made under which any deductions or discounts may be claimed concerning the
		Collateral except those disclosed to Lender in writing.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Location of the
		Collateral.</FONT></B><FONT STYLE="font-size:10pt"> Except in the ordinary
		course of Grantor&#146;s business, Grantor agrees to keep the Collateral (or to
		the extent the Collateral consists of intangible property such as accounts or
		general intangibles, the records concerning the Collateral) at Grantor&#146;s
		address shown above or at such other locations as are acceptable to Lender.
		Upon Lender&#146;s request, Grantor will deliver to Lender in form satisfactory
		to Lender a schedule of real properties and Collateral locations relating to
		Grantor&#146;s operations, including without limitation the following: (1) all
		real property Grantor owns or is purchasing; (2) all real property Grantor is
		renting or leasing; (3) all storage facilities Grantor owns, rents, leases, or
		uses; and (4) all other properties where Collateral is or may be located.
		</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Removal of the
		Collateral.</FONT></B><FONT STYLE="font-size:10pt"> Except in the ordinary
		course of Grantor&#146;s business, including the sales of inventory, Grantor
		shall not remove the Collateral from its existing location without
		Lender&#146;s prior written consent. To the extent that the Collateral consists
		of vehicles, or other titled property, Grantor shall not take or permit any
		action which would require application for certificates of title for the
		vehicles outside the State of New York, without Lender&#146;s prior written
		consent, which consent shall not be unreasonably withheld. Grantor shall,
		whenever requested, advise Lender of the exact location of the Collateral.
		</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Transactions Involving Collateral.
		</FONT></B><FONT STYLE="font-size:10pt">Except for inventory sold or accounts
		collected in the ordinary course of Grantor&#146;s business, or as otherwise
		provided for in this Agreement, Grantor shall not sell, offer to sell, or
		otherwise transfer or dispose of the Collateral. While Grantor is not in
		default under this Agreement, Grantor may sell inventory, but only in the
		ordinary course of its business and only to buyers who qualify as a buyer in
		the ordinary course of business. A sale in the ordinary course of
		Grantor&#146;s business does not include a transfer in partial or total
		satisfaction of a debt or any bulk sale. Grantor shall not pledge, mortgage,
		encumber or otherwise permit the Collateral to be subject to any lien, security
		interest, encumbrance, or charge, other than the security interest provided for
		in this Agreement, without the prior written consent of Lender. This includes
		security interests even if junior in right to the security interests granted
		under this Agreement. Unless waived by Lender, all proceeds from any
		disposition of the Collateral (for whatever reason) shall be held in trust for
		Lender and shall not be commingled with any other funds; provided however, this
		requirement shall not constitute consent by Lender to any sale or other
		disposition. Upon receipt, Grantor shall immediately deliver any such proceeds
		to Lender. </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="83%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <B><FONT STYLE="FONT-SIZE:10PT">COMMERCIAL SECURITY
				  AGREEMENT</FONT></B><BR> <B><FONT STYLE="font-size:10pt">(continued)
				  </FONT></B>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="14%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Page - 5 -</FONT></B>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Title.</FONT></B><FONT
		STYLE="font-size:10pt"> Grantor represents and warrants to Lender that Grantor
		holds good and marketable title to the Collateral, free and clear of all liens
		and encumbrances except for the lien of this Agreement. No financing statement
		covering any of the Collateral is on file in any public office other than those
		which reflect the security interest created by this Agreement or to which
		Lender has specifically consented. Grantor shall defend Lender&#146;s rights in
		the Collateral against the claims and demands of all other persons. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Repairs and Maintenance.</FONT></B><FONT
		STYLE="font-size:10pt"> Grantor agrees to keep and maintain, and to cause
		others to keep and maintain, the Collateral in good order, repair and condition
		at all times while this Agreement remains in effect. Grantor further agrees to
		pay when due all claims for work done on, or services rendered or material
		furnished in connection with the Collateral so that no lien or encumbrance may
		ever attach to or be filed against the Collateral. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Inspection of Collateral.</FONT></B><FONT
		STYLE="font-size:10pt"> Lender and Lender&#146;s designated representatives and
		agents shall have the right at all reasonable times to examine and inspect the
		Collateral wherever located. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Taxes, Assessments and Liens.
		</FONT></B><FONT STYLE="font-size:10pt">Grantor will pay when due all taxes,
		assessments and liens upon the Collateral, its use or operation, upon this
		Agreement, upon any promissory note or notes evidencing the Indebtedness, or
		upon any of the other Related Documents. Grantor may withhold any such payment
		or may elect to contest any lien if Grantor is in good faith conducting an
		appropriate proceeding to contest the obligation to pay and so long as
		Lender&#146;s interest in the Collateral is not jeopardized in Lender&#146;s
		sole opinion. If the Collateral is subjected to a lien which is not discharged
		within fifteen (15) days, Grantor shall deposit with Lender cash, a sufficient
		corporate surety bond or other security satisfactory to Lender in an amount
		adequate to provide for the discharge of the lien plus any interest, costs,
		reasonable attorneys&#146; fees or other charges that could accrue as a result
		of foreclosure or sale of the Collateral. In any contest Grantor shall defend
		itself and Lender and shall satisfy any final adverse judgment before
		enforcement against the Collateral. Grantor shall name Lender as an additional
		obligee under any surety bond furnished in the contest proceedings. Grantor
		further agrees to furnish Lender with evidence that such taxes, assessments,
		and governmental and other charges have been paid in full and in a timely
		manner. Grantor may withhold any such payment or may elect to contest any lien
		if Grantor is in good faith conducting an appropriate proceeding to contest the
		obligation to pay and so long as Lender&#146;s interest in the Collateral is
		not jeopardized. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Compliance with Governmental
		Requirements.</FONT></B><FONT STYLE="font-size:10pt"> Grantor shall comply
		promptly in all material respects with all laws, ordinances, rules and
		regulations of all governmental authorities, now or hereafter in effect,
		applicable to the ownership, production, disposition, or use of the Collateral,
		including all laws or regulations relating to the undue </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="83%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <B><FONT STYLE="FONT-SIZE:10PT">COMMERCIAL SECURITY
				  AGREEMENT</FONT></B><BR> <B><FONT STYLE="font-size:10pt">(continued)
				  </FONT></B>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="14%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Page - 6 -</FONT></B>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">erosion of highly-erodible land or relating
		to the conversion of wetlands for the production of an agricultural product or
		commodity. Grantor may contest in good faith any such law, ordinance or
		regulation and withhold compliance during any proceeding, including appropriate
		appeals, so long as Lender&#146;s interest in the Collateral, in Lender&#146;s
		opinion, is not jeopardized.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Hazardous Substances. </FONT></B><FONT
		STYLE="font-size:10pt">Grantor represents and warrants that the Collateral
		never has been, and never will be so long as this Agreement remains a lien on
		the Collateral, used in violation of any Environmental laws or for the
		generation, manufacture, storage, transportation, treatment, disposal, release
		or threatened release of any Hazardous Substance. The representations and
		warranties contained herein are based on Grantor&#146;s due diligence in
		investigation the Collateral for Hazard Substances. Grantor hereby (1) releases
		and waives any future claims against Lender for indemnity or contribution in
		the event Grantor becomes liable for cleanup or other costs under any
		Environmental laws, and (2) agrees to indemnify and hold harmless Lender
		against any and all claims and losses resulting from a breach of this provision
		of this Agreement. This obligation to indemnify shall survive the payment of
		the Indebtedness and the satisfaction of this Agreement.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Maintenance of Casualty
		Insurance.</FONT></B><FONT STYLE="font-size:10pt"> Grantor shall procure and
		maintain all risks insurance, including without limitation fire, theft and
		liability coverage together with such other insurance as Lender may require
		with respect to the Collateral, in form, amounts, coverages and basis
		reasonably acceptable to Lender and issued by a company or companies reasonably
		acceptable to Lender. Grantor, upon request of Lender, will deliver to Lender
		from time to time the policies or certificates of insurance in form
		satisfactory to Lender, including stipulations that coverages will not be
		cancelled or diminished without at least thirty (30) days prior written notice
		to Lender and not including any disclaimer of the insurer&#146;s liability for
		failure to give such a notice. Each insurance policy also shall include an
		endorsement providing that coverage in favor of Lender will not be impaired in
		any way by any act, omission or default of Grantor or any other person. In
		connection with all policies covering assets in which Lender holds or is
		offered a security interest, Grantor will provide Lender with such loss payable
		or other endorsements as Lender may require. If Grantor at any time fails to
		obtain or maintain any insurance as required under this Agreement, Lender may
		(but shall not be obligated to) obtain such insurance as Lender deems
		appropriate, including if Lender so chooses &#147;single interest
		insurance,&#148; which will cover only Lender&#146;s interest in the
		Collateral.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Application of Insurance
		Proceeds.</FONT></B><FONT STYLE="font-size:10pt"> Grantor shall promptly notify
		Lender of any loss or damage to the Collateral, whether or not such casualty or
		loss is covered by insurance. Lender may make proof of loss if Grantor fails to
		do so within fifteen (15) days of the casualty. All proceeds of any insurance
		on the Collateral, including accrued proceeds thereon, shall be held by Lender
		as part of the Collateral. If Lender consents to repair or replacement of the
		damaged or destroyed Collateral, Lender shall, upon satisfactory proof </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="83%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <B><FONT STYLE="FONT-SIZE:10PT">COMMERCIAL SECURITY
				  AGREEMENT</FONT></B><BR> <B><FONT STYLE="font-size:10pt">(continued)
				  </FONT></B>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="14%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Page - 7 -</FONT></B>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">of expenditure, pay or reimburse Grantor
		from the proceeds for the reasonable cost of repair or restoration. If Lender
		does not consent to repair or replacement of the Collateral, Lender shall
		retain a sufficient amount of the proceeds to pay all of the Indebtedness, and
		shall pay the balance to Granter. Any proceeds which have not been disbursed
		within six (6) months after their receipt and which Grantor has not committed
		to the repair or restoration of the Collateral shall be used to prepay the
		Indebtedness. Grantor hereby appoints Lender as its attorney-in-fact with full
		power and authority to endorse in Grantor&#146;s name any check or draft
		representing the proceeds of any insurance on the Collateral and to settle or
		compromise in Grantor&#146;s name any claims with respect to such
		insurance.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT
		STYLE="font-size:10pt">Insurance Reserves.</FONT></B><FONT
		STYLE="font-size:10pt"> Lender may require Grantor to maintain with Lender
		reserves for payment of insurance premiums, which reserves shall be created by
		monthly payments from Grantor of a sum estimated by Lender to be sufficient to
		produce, at least fifteen (15) days before the premium due date, amounts at
		least equal to the insurance premiums to be paid. If fifteen (15) days before
		payment is due, the reserve funds are insufficient, Grantor shall upon demand
		pay any deficiency to Lender. The reserve funds shall be held by Lender as a
		general deposit and shall constitute a non-interest-bearing account which
		Lender may satisfy by payment of the insurance premiums required to be paid by
		Grantor as they become due. Lender does not hold the reserve funds in trust for
		Grantor, and Lender is not the agent of Granter for payment of the insurance
		premiums required to be paid by Grantor. The responsibility for the payment of
		premiums shall remain Grantor&#146;s sole responsibility. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Insurance Reports.</FONT></B><FONT
		STYLE="font-size:10pt"> Grantor, upon request of Lender, shall furnish to
		Lender reports on each existing policy of insurance showing such information as
		Lender may reasonably request including the following: (1) the name of the
		insurer; (2) the risks insured; (3) the amount of the policy; (4) the property
		insured; (5) the then current value on the basis of which insurance has been
		obtained and the manner of determining that value; and (6) the expiration date
		of the policy. In addition, Grantor shall upon request by Lender (however not
		more often than annually) have an independent appraiser satisfactory to Lender
		determine, as applicable, the cash value or replacement cost of the Collateral.
		</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Financing Statements.</FONT></B><FONT
		STYLE="font-size:10pt"> Grantor authorizes Lender to file a UCC financing
		statement, or alternatively, a copy of this Agreement to perfect Lender&#146;s
		security interest. At Lender&#146;s request, Grantor additionally agrees to
		sign all other documents that are necessary to perfect, protect, and continue
		Lender&#146;s security interest in the Property. Grantor will pay all filing
		fees, title transfer fees, and other fees and costs involved unless prohibited
		by law or unless Lender is required by law to pay such fees and costs. Grantor
		irrevocably appoints Lender to execute documents necessary to transfer title if
		there is a default. Lender may file a copy of this Agreement as a financing
		statement. If Grantor changes Grantor&#146;s name or address, or the name or
		address of any person granting a security </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="83%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <B><FONT STYLE="FONT-SIZE:10PT">COMMERCIAL SECURITY
				  AGREEMENT</FONT></B><BR> <B><FONT STYLE="font-size:10pt">(continued)
				  </FONT></B>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="14%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Page - 8 -</FONT></B>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">interest under this Agreement changes,
		Grantor will promptly notify the Lender of such change.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<B><FONT STYLE="font-size:10pt">GRANTOR&#146;S RIGHT TO POSSESSION AND TO
		COLLECT ACCOUNTS.</FONT></B><FONT STYLE="font-size:10pt"> Until default and
		except as otherwise provided below with respect to accounts, Grantor may have
		possession of the tangible personal property and beneficial use of all the
		Collateral and may use it in any lawful manner not inconsistent with this
		Agreement or the Related Documents, provided that Grantor&#146;s right to
		possession and beneficial use shall not apply to any Collateral where
		possession of the Collateral by Lender is required by law to perfect
		Lender&#146;s security interest in such Collateral. Until otherwise notified by
		Lender, Grantor may collect any of the Collateral consisting of accounts. At
		any time and even though no Event of Default exists, Lender may exercise its
		rights to collect the accounts and to notify account debtors to make payments
		directly to Lender for application to the Indebtedness. If Lender at any time
		has possession of any Collateral, whether before or after an Event of Default,
		Lender shall be deemed to have exercised reasonable care in the custody and
		preservation of the Collateral if Lender takes such action for that purpose as
		Grantor shall request or as Lender, in Lender&#146;s sole discretion, shall
		deem appropriate under the circumstances, but failure to honor any request by
		Grantor shall not of itself be deemed to be a failure to exercise reasonable
		care. Lender shall not be required to take any steps necessary to preserve any
		rights in the Collateral against prior parties, nor to protect, preserve or
		maintain any security interest given to secure the Indebtedness.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<B><FONT STYLE="font-size:10pt">LENDER&#146;S
		EXPENDITURES.</FONT></B><FONT STYLE="font-size:10pt"> If any action or
		proceeding is commenced that would materially affect Lender&#146;s interest in
		the Collateral or if Grantor fails to comply with any provision of this
		Agreement or any Related Documents, including but not limited to Grantor&#146;s
		failure to discharge or pay when due any amounts Grantor is required to
		discharge or pay under this Agreement or any Related Documents, Lender on
		Grantor&#146;s behalf may (but shall not be obligated to) take any action that
		Lender deems appropriate, including but not limited to discharging or paying
		all taxes, liens, security interests, encumbrances and other claims, at any
		time levied or placed on the Collateral and paying all costs for insuring,
		maintaining and preserving the Collateral. All such expenditures incurred or
		paid by Lender for such purposes, with the exception of insurance premiums paid
		by Lender with respect to motor vehicles, but including the payment of
		attorneys&#146; fees and expenses, will then bear interest at the rate charged
		under the Note from the date incurred or paid by Lender to the date of
		repayment by Grantor. All such expenses will become a part of the Indebtedness
		and, at Lender&#146;s option, will (A) be payable on demand; (B) be added to
		the balance of the Note and be apportioned among and be payable with any
		installment payments to become due during either (1) the term of any applicable
		insurance policy; or (2) the remaining term of the Note; or (C) be treated. as
		a balloon payment which will be due and payable at the Note&#146;s maturity.
		The Agreement also will secure payment of these amounts. Such right shall be in
		addition to all other rights and remedies to which Lender may be entitled upon
		Default.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="83%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <B><FONT STYLE="FONT-SIZE:10PT">COMMERCIAL SECURITY
				  AGREEMENT</FONT></B><BR> <B><FONT STYLE="font-size:10pt">(continued)
				  </FONT></B>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="14%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Page - 9 -</FONT></B>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<B><FONT STYLE="FONT-SIZE:10PT">DEFAULT.</FONT></B><FONT
		STYLE="font-size:10pt"> The occurrence and continuance of an Event of Default
		under (and as defined in) that certain Credit Agreement between Grantor and
		Lender of even date herewith (as same may be amended from time to time) shall
		constitute an Event of Default hereunder.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<B><FONT STYLE="FONT-SIZE:10PT">RIGHTS AND REMEDIES ON
		DEFAULT.</FONT></B><FONT STYLE="font-size:10pt"> If an Event of Default occurs
		under this Agreement, at any time thereafter, Lender shall have all the rights
		of a secured party under the New York Uniform Commercial Code. In addition and
		without limitation, Lender may exercise any one or more of the following rights
		and remedies:</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Accelerate Indebtedness.</FONT></B><FONT
		STYLE="font-size:10pt"> Lender may declare the entire Indebtedness, including
		any prepayment penalty which Grantor would be required to pay, immediately due
		and payable, without notice of any kind to Grantor.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Assemble Collateral.</FONT></B><FONT
		STYLE="font-size:10pt"> Lender may require Grantor to deliver to Lender all or
		any portion of the Collateral and any and all certificates of title and other
		documents relating to the Collateral. Lender may require Grantor to assemble
		the Collateral and make it available to Lender at a place to be designated by
		Lender. Lender also shall have full power to enter upon the property of Grantor
		to take possession of and remove the Collateral. If the Collateral contains
		other goods not covered by this Agreement at the time of repossession, Grantor
		agrees Lender may take such other goods, provided that Lender makes reasonable
		efforts to return them to Grantor after repossession.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Sell the Collateral.</FONT></B><FONT
		STYLE="font-size:10pt"> Lender shall have full power to sell, lease, transfer,
		or otherwise deal with the Collateral or proceeds thereof in Lender&#146;s own
		name or that of Grantor. Lender may sell the Collateral at public auction or
		private sale. Unless the Collateral threatens to decline speedily in value or
		is of a type customarily sold on a recognized market, Lender will give Grantor,
		and other persons as required by law, reasonable notice of the time and place
		of any public sale, or the time after which any private sale or any other
		disposition of the Collateral is to be made. However, no notice need be
		provided to any person who, after Event of Default occurs, enters into and
		authenticates an agreement waiving that person&#146;s right to notification of
		sale. The requirements of reasonable notice shall be met if such notice is
		given at least ten (10) days before the time of the sale or disposition. All
		expenses relating to the disposition of the Collateral, including without
		limitation the expenses of retaking, holding, insuring, preparing for sale and
		selling the Collateral (including legal fees and costs), shall become a part of
		the Indebtedness secured by this Agreement and payable from the proceeds of the
		disposition of the Collateral, and shall be payable on demand, with interest at
		the Note rate from date of expenditure until repaid.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Appoint Receiver.</FONT></B><FONT
		STYLE="font-size:10pt"> Lender shall have the right to have a receiver
		appointed to take possession of all or any part of the Collateral, with the
		power to protect and preserve the Collateral, to operate the Collateral
		proceeding foreclosure or sale, and to collect the Rents from the Collateral
		and apply the proceeds, over and above the cost of the </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="83%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <B><FONT STYLE="FONT-SIZE:10PT">COMMERCIAL SECURITY
				  AGREEMENT</FONT></B><BR> <B><FONT STYLE="font-size:10pt">(continued)
				  </FONT></B>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="14%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Page - 10</FONT></B>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">receivership, against the Indebtedness.
		Lender&#146;s right to the appointment of a receiver shall exist whether or not
		the apparent value of the Collateral exceeds the Indebtedness by a substantial
		amount. The right to a receiver shall be given to Lender regardless of the
		solvency of Grantor without any requirement to give prior notice to
		Grantor.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Collect Revenues, Apply
		Accounts.</FONT></B><FONT STYLE="font-size:10pt"> Lender, either itself or
		through a receiver, may collect the payments, rents, income, and revenues from
		the Collateral. Lender may at any time in Lender&#146;s discretion transfer any
		Collateral into Lender&#146;s own name or that of Lender&#146;s nominee and
		receive the payments, rents, income, and revenues therefrom and hold the same
		as security for the Indebtedness or apply it to payment of the Indebtedness in
		such order of preference as Lender may determine. Insofar as the Collateral
		consists of accounts, general intangibles, insurance policies, instruments,
		chattel paper, choses in action, or similar property, Lender may demand,
		collect, receipt for, settle, compromise, adjust, sue for, foreclose, or
		realize on the Collateral as Lender may determine, whether or not Indebtedness
		or Collateral is then due. For these purposes, Lender may, on behalf of and in
		the name of Grantor, receive, open and dispose of mail addressed to Grantor;
		change any address to which mail and payments are to be sent; and endorse
		notes, checks, drafts, money orders, documents of title, instruments and items
		pertaining to payment, shipment, or storage of any Collateral. To facilitate
		collection, Lender may notify account debtors and obligors on any Collateral to
		make payments directly to Lender.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Obtain Deficiency.</FONT></B><FONT
		STYLE="font-size:10pt"> If Lender chooses to sell any or all of the Collateral,
		Lender may obtain a judgment against Grantor for any deficiency remaining on
		the Indebtedness due to Lender after application of all amounts received from
		the exercise of the rights provided in this Agreement. Grantor shall be liable
		for a deficiency even if the transaction described in this subsection is a sale
		of accounts or chattel paper.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Other Rights and
		Remedies.</FONT></B><FONT STYLE="font-size:10pt"> Lender shall have all the
		rights and remedies of a secured creditor under the provisions of the Uniform
		Commercial Code, as may be amended from time to time. In addition, Lender shall
		have and may exercise any or all other rights and remedies it may have
		available at law, in equity, or otherwise. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Election of Remedies. </FONT></B><FONT
		STYLE="font-size:10pt">Except as may be prohibited by applicable law, all of
		Lender&#146;s rights and remedies, whether evidenced by this Agreement, the
		Related Documents, or by any other writing, shall be cumulative and may be
		exercised singularly or concurrently. Election by Lender to pursue any remedy
		shall not exclude pursuit of any other remedy, and an election to make
		expenditures or to take action to perform an obligation of Grantor under this
		Agreement, after Grantor&#146;s failure to perform, shall not affect
		Lender&#146;s right to declare a default and exercise its remedies.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<B><FONT STYLE="FONT-SIZE:10PT">MISCELLANEOUS PROVISIONS.</FONT></B><FONT
		STYLE="font-size:10pt"> The following miscellaneous provisions are a part of
		this Agreement:</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="83%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <B><FONT STYLE="FONT-SIZE:10PT">COMMERCIAL SECURITY
				  AGREEMENT</FONT></B><BR> <B><FONT STYLE="font-size:10pt">(continued)
				  </FONT></B>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="14%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Page - 11</FONT></B>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Amendments.</FONT></B><FONT
		STYLE="font-size:10pt"> This Agreement, together with any Related Documents,
		constitutes the entire understanding and agreement of the parties as to the
		matters set forth in this Agreement. No alteration of or amendment to this
		Agreement shall be effective unless given in writing and signed by the party or
		parties sought to be charged or bound by the alteration or amendment.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Attorneys&#146; Fees;
		Expenses.</FONT></B><FONT STYLE="font-size:10pt"> Grantor agrees to pay upon
		demand all of Lender&#146;s costs and expenses, including Lender&#146;s
		reasonable attorneys&#146; fees and Lender&#146;s legal expenses, incurred in
		connection with the enforcement of this Agreement. Lender may hire or pay
		someone else to help enforce this Agreement, and Grantor shall pay the costs
		and expenses of such enforcement. Costs and expenses include Lender&#146;s
		reasonable attorneys&#146; fees and legal expenses whether or not there is a
		lawsuit, including reasonable attorneys&#146; fees and legal expenses for
		bankruptcy proceedings (including efforts to modify or vacate any automatic
		stay or injunction), appeals, and any anticipated post-judgment collection
		services. Grantor also shall pay all court costs and such additional fees as
		may be directed by the court. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Caption Headings.</FONT></B><FONT
		STYLE="font-size:10pt"> Caption headings in this Agreement are for convenience
		purposes only and are not to be used to interpret or define the provisions of
		this Agreement. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:12pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Governing Law. This Agreement will be
		governed by federal law applicable to Lender and, to the extent not preempted
		by federal law, the laws of the State of New York without regard to its
		conflicts of law provisions. This Agreement has been accepted by Lender in the
		State of New York. </FONT></B>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Joint and Several Liability.
		</FONT></B><FONT STYLE="font-size:10pt">If there is more than one party
		executing as Grantor below, then all obligations of Grantor under this
		Agreement shall be joint and several, and all references to Grantor shall mean
		each and every Grantor. This means that each Grantor signing below is
		responsible for all obligations in this Agreement. Where any one or more of the
		parties is a corporation, partnership, limited liability company or similar
		entity, it is not necessary for Lender to inquire into the powers of any of the
		officers, directors, partners, members, or other agents acting or purporting to
		act on the entity&#146;s behalf, and any obligations made or created in
		reliance upon the professed exercise of such powers shall be guaranteed under
		this Agreement.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">No Waiver by Lender.</FONT></B><FONT
		STYLE="font-size:10pt"> Lender shall not be deemed to have waived any rights
		under this Agreement unless such waiver is given in writing and signed by
		Lender. No delay or omission on the part of Lender in exercising any right
		shall operate as a waiver of such right or any other right. A waiver by Lender
		of a provision of this Agreement shall not prejudice or constitute a waiver of
		Lender&#146;s right otherwise to demand strict compliance with that provision
		or any other provision of this Agreement. No prior waiver by Lender, nor any
		course of dealing between Lender and Grantor, shall constitute a waiver of any
		of </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="83%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <B><FONT STYLE="FONT-SIZE:10PT">COMMERCIAL SECURITY
				  AGREEMENT</FONT></B><BR> <B><FONT STYLE="font-size:10pt">(continued)
				  </FONT></B>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="14%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Page - 12</FONT></B>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">Lender&#146;s rights or of any of
		Grantor&#146;s obligations as to any future transactions. Whenever the consent
		of Lender is required under this Agreement, the granting of such consent by
		Lender in any instance shall not constitute continuing consent to subsequent
		instances where such consent is required and in all cases such consent may be
		granted or withheld in the sole discretion of Lender.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Notices.</FONT></B><FONT
		STYLE="font-size:10pt"> Any notice required to be given under this Agreement
		shall be given in writing, and shall be effective when actually delivered, when
		actually received by telefacsimile (unless otherwise required by law), when
		deposited with a nationally recognized overnight courier, or, if mailed, when
		deposited in the United States mail, as first class, certified or registered
		mail postage prepaid, directed to the addresses shown near the beginning of
		this Agreement. Any party may change its address for notices under this
		Agreement by giving formal written notice to the other parties, specifying that
		the purpose of the notice is to change the party&#146;s address. For notice
		purposes, Grantor agrees to keep Lender informed at all times of Grantor&#146;s
		current address. Unless otherwise provided or required by law, if there is more
		than one Grantor, any notice given by Lender to any Grantor is deemed to be
		notice given to all Grantors.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT
		STYLE="font-size:10pt">Power of Attorney. </FONT></B><FONT
		STYLE="font-size:10pt">Grantor hereby appoints Lender as Grantor&#146;s
		irrevocable attorney-in-fact for the purpose of executing any documents
		necessary to perfect, amend, or to continue the security interest granted in
		this Agreement or to demand termination of filings of other secured parties.
		Lender may at any time, and without further authorization from Grantor, file a
		carbon, photographic or other reproduction of any financing statement or of
		this Agreement for use as a financing statement. Grantor will reimburse Lender
		for all expenses for the perfection and the continuation of the perfection of
		Lender&#146;s security interest in the Collateral. Grantor authorizes Lender to
		file a financing statement covering the Collateral.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Severability. </FONT></B><FONT
		STYLE="font-size:10pt">If a court of competent jurisdiction finds any provision
		of this Agreement to be illegal, invalid, or unenforceable as to any person or
		circumstance, that finding shall not make the offending provision illegal
		invalid, or unenforceable as to any other person or circumstance. If feasible,
		the offending provision shall be considered modified so that it becomes legal,
		valid and enforceable. If the offending provision cannot be so modified, it
		shall be considered deleted from this Agreement. Unless otherwise required by
		law, the illegality, invalidity, or unenforceability of any provision of this
		Agreement shall not affect the legality, validity or enforceability of any
		other provision of this Agreement.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Successors and Assigns.</FONT></B><FONT
		STYLE="font-size:10pt"> Subject to any limitations stated in this Agreement on
		transfer of Grantor&#146;s interest, this Agreement shall be binding upon and
		inure to the benefit of the parties, their successors and assigns. If ownership
		of the Collateral becomes vested in a person other than Grantor, Lender,
		without notice to Grantor, may deal with Grantor&#146;s successors with
		reference to this Agreement and the Indebtedness by way of forbearance </FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="83%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <B><FONT STYLE="FONT-SIZE:10PT">COMMERCIAL SECURITY
				  AGREEMENT</FONT></B><BR> <B><FONT STYLE="font-size:10pt">(continued)
				  </FONT></B>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="14%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Page - 13</FONT></B>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<FONT STYLE="font-size:10pt">or extension without releasing Grantor from
		the obligations of this Agreement or liability under the Indebtedness.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Survival of Representations and
		Warranties.</FONT></B><FONT STYLE="font-size:10pt"> All representations,
		warranties, and agreements made by Grantor in this Agreement shall survive the
		execution and delivery of this Agreement, shall be continuing in nature, and
		shall remain in full force and effect until such time as Grantor&#146;s
		Indebtedness shall be paid in full.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Subordination.</FONT></B><FONT
		STYLE="font-size:10pt"> Notwithstanding any provision herein to the contrary,
		the security interest and lien upon the Collateral created hereby is subject
		and subordinate to the rights of the United States of America
		(&#147;Government&#148;) pursuant to that Subordination Agreement by Grantor
		and Lender in favor of the Government of even date herewith.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Time is of the Essence.</FONT></B><FONT
		STYLE="font-size:10pt"> Time is of the essence in the performance of this
		Agreement. </FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:12pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Waive Jury. All parties to this Agreement
		hereby waive the right to any jury trial in any action, proceeding, or
		counterclaim brought by any party against any other party.</FONT></B>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<B><FONT STYLE="font-size:10pt">DEFlNITIONS. </FONT></B><FONT
		STYLE="font-size:10pt">The following capitalized words and terms shall have the
		following meanings when used in this Agreement. Unless specifically stated to
		the contrary, all references to dollar amounts shall mean amounts in lawful
		money of the United States of America. Words and terms used in the singular
		shall include the plural, and the plural shall include the singular, as the
		context may require. Words and terms not otherwise defined in this Agreement
		shall have the meanings attributed to such terms in the Uniform Commercial
		Code:</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Agreement.</FONT></B><FONT
		STYLE="font-size:10pt"> The word &#147;Agreement&#148; means this Commercial
		Security Agreement, as this Commercial Security Agreement may be amended or
		modified from time to time, together with all exhibits and schedules attached
		to this Commercial Security Agreement from time to time.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Collateral.</FONT></B><FONT
		STYLE="font-size:10pt"> The word &#147;Collateral&#148; means all of
		Grantor&#146;s right, title and interest in and to all the Collateral as
		described In the Collateral Description section of this Agreement.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Credit Agreement.</FONT></B><FONT
		STYLE="font-size:10pt"> The words &#147;Credit Agreement&#148; mean that
		certain credit agreement dated on or about the date hereof between the Grantor
		and the Lender, as same may be hereafter amended, restated, increased or
		otherwise modified in writing from time to time.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Default.</FONT></B><FONT
		STYLE="font-size:10pt"> The word &#147;Default&#148; means the Default set
		forth in this Agreement in the section titled &#147;Default&#148;.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="83%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <B><FONT STYLE="FONT-SIZE:10PT">COMMERCIAL SECURITY
				  AGREEMENT</FONT></B><BR> <B><FONT STYLE="font-size:10pt">(continued)
				  </FONT></B>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="14%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Page - 14</FONT></B>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT
		STYLE="font-size:10pt">Environmental Laws.</FONT></B><FONT
		STYLE="font-size:10pt"> The words &#147;Environmental Laws&#148; mean any and
		all state, federal and local statutes, regulations and ordinances relating to
		the protection of human health or the environment, including without limitation
		the Comprehensive Environmental Response, Compensation, and Liability Act of
		1980, as amended, 42 U.S.C. Section 9601, et seq. (&#147;CERCLA&#148;), the
		Superfund Amendment and Reauthorization Act of 1986, Pub. L. No. 99-499
		(&#147;SARA&#148;), the Hazardous Materials Transportation Act, 49 U.S.C.
		Section 1801, et seq., the Resource Conservation and Recovery Act, 42 U.S.C.
		Section 6901, et seq., or other applicable state or federal laws, rules or
		regulations adopted pursuant thereto.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Event of Default.</FONT></B><FONT
		STYLE="font-size:10pt"> The words &#147;Event of Default&#148; mean any of the
		events of default set forth in this Agreement in the default section of this
		Agreement.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Grantor.</FONT></B><FONT
		STYLE="font-size:10pt"> The word &#147;Grantor&#148; means CPI Aerostructures,
		Inc. and includes all co-signers and co-makers signing the Note and, all their
		successors and assigns.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Guarantor.</FONT></B><FONT
		STYLE="font-size:10pt"> The word &#147;Guarantor&#148; means any guarantor,
		surety, or accommodation party, if any, of any or all of the
		Indebtedness.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Guaranty.</FONT></B><FONT
		STYLE="font-size:10pt"> The word &#147;Guaranty&#148; means the guaranty from
		Guarantor to Lender, including without limitation a guaranty of all or part of
		the Note.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Hazardous Substances.</FONT></B><FONT
		STYLE="font-size:10pt"> The words &#147;Hazardous Substances&#148; mean
		materials that, because of their quantity, concentration or physical, chemical
		or infectious characteristics, may cause or pose a present or potential hazard
		to human health or the environment when improperly used, treated, stored,
		disposed of, generated, manufactured, transported or otherwise handled. The
		words &#147;Hazardous Substances&#148; are used in their very broadest sense
		and include, without limitation, any and all hazardous or toxic substances,
		materials or waste as defined by or listed under the Environmental Laws. The
		term &#147;Hazardous Substances&#148; also includes, without limitation,
		petroleum and petroleum by-products or any fraction thereof and
		asbestos.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Indebtedness.</FONT></B><FONT
		STYLE="font-size:10pt"> The word &#147;Indebtedness&#148; means the
		indebtedness evidenced by the Note or Related Documents, including all
		principal and interest together with all other indebtedness and costs and
		expenses for which Grantor is responsible under this Agreement or under any of
		the Related Documents. Specifically, without limitation, Indebtedness includes
		the future advances set forth in the Future Advances provision, together with
		interest thereon and all amounts that may be indirectly secured by the
		Cross-Collateralization provision of this Agreement.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Lender.</FONT></B><FONT
		STYLE="font-size:10pt"> The word &#147;Lender&#148; means Sovereign Bank, it
		successors and assigns.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
<!-- EEDocs PBStart--><HR NOSHADE="noshade" ALIGN="center" WIDTH="100%"
	 SIZE="2"><PAGE>
<!-- EEDocs PBEnd-->
	 <DIV ALIGN="left">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD WIDTH="83%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <B><FONT STYLE="FONT-SIZE:10PT">COMMERCIAL SECURITY
				  AGREEMENT</FONT></B><BR> <B><FONT STYLE="font-size:10pt">(continued)
				  </FONT></B>
				</P>
			 </TD>
			 <TD WIDTH="2%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="14%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <B><FONT STYLE="font-size:10pt">Page - 15</FONT></B>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom" STYLE="border-bottom: double black 2.25pt;">
				<P
				 STYLE=" margin-left:0in;text-indent:0pt;text-align:right;margin-top:2pt;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Note.</FONT></B><FONT
		STYLE="font-size:10pt"> The word &#147;Note&#148; means each note executed by
		the Grantor pursuant to the Credit Agreement together with all renewals of,
		extensions of, modifications of, refinancings of, consolidations of, and
		substitutions for the note or Credit Agreement.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT STYLE="font-size:10pt">Property.</FONT></B><FONT
		STYLE="font-size:10pt"> The word &#147;Property&#148; means all of
		Grantor&#146;s right, title and interest in and to all the Property as
		described in the &#147;Collateral Description&#148; section of this
		Agreement.</FONT>
	 </P>
	 <P
	  STYLE=" margin-bottom:0pt; margin-top:8pt; margin-left:5%;text-align:left;">
		<B><FONT
		STYLE="font-size:10pt">Related Documents. </FONT></B><FONT
		STYLE="font-size:10pt">The words &#147;Related Documents&#148; mean,
		collectively, the Credit Agreement, each Note, this Agreement and all
		promissory notes, credit agreements, loan agreements, environmental agreements,
		guaranties, security agreements, mortgages, deeds of trust, security deeds,
		collateral mortgages, and all other instruments, agreements, and documents,
		whether now or hereafter existing, executed in connection with the
		Indebtedness.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="FONT-SIZE:10PT">GRANTOR HAS READ AND UNDERSTOOD ALL THE
		PROVISIONS OF THIS COMMERCIAL SECURITY AGREEMENT AND AGREE TO ITS TERMS. THIS
		AGREEMENT IS DATED AUGUST 13, 2007.</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <DIV ALIGN="center">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD COLSPAN="2" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="FONT-SIZE:10PT">GRANTOR:</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD COLSPAN="2" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD COLSPAN="2" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="FONT-SIZE:10PT">CPI AEROSTRUCTURES, INC.</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD WIDTH="49%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				</P>
			 </TD>
			 <TD WIDTH="7%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="4%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">By:&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="40%" VALIGN="bottom"
			  STYLE="border-bottom: solid black .5pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <BR> <FONT STYLE="font-size:10pt">/s/ Vincent Palazzolo</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Vincent Palazzolo</FONT><BR>
				  <FONT STYLE="font-size:10pt">Chief Financial Officer</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <DIV ALIGN="center">
		<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" WIDTH="100%"
		 STYLE=" border-collapse:collapse;">
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD COLSPAN="2" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="FONT-SIZE:10PT">LENDER:</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD COLSPAN="2" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD COLSPAN="2" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="FONT-SIZE:10PT">SOVEREIGN BANK</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD WIDTH="49%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				</P>
			 </TD>
			 <TD WIDTH="7%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="4%" VALIGN="bottom">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">By:&nbsp;</FONT>
				</P>
			 </TD>
			 <TD WIDTH="40%" VALIGN="bottom"
			  STYLE="border-bottom: solid black .5pt;">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <BR> <FONT STYLE="font-size:10pt">/s/ Christine Gerula</FONT>
				</P>
			 </TD>
		  </TR>
		  <TR>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">&nbsp;</FONT>
				</P>
			 </TD>
			 <TD VALIGN="top">
				<P
				 STYLE=" margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt;">
				  <FONT STYLE="font-size:10pt">Christine Gerula</FONT><BR>
				  <FONT STYLE="font-size:10pt">Senior Vice President</FONT>
				</P>
			 </TD>
		  </TR>
		</TABLE> </DIV>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:8pt;text-align:left;">
		<FONT STYLE="font-size:10pt">&nbsp;</FONT>
	 </P>
	 <P STYLE=" margin-bottom:0pt; margin-top:0pt;text-align:left;">
		<FONT STYLE="font-size:12pt">&nbsp;</FONT>
	 </P>
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<DOCUMENT>
<TYPE>EX-31.1
<SEQUENCE>4
<FILENAME>file4.htm
<DESCRIPTION>CERTIFICATION
<TEXT>
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<page>
<a name="page"></a>
<p style="font-family:serif;font-weight:normal;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; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">
<font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">EXHIBIT 31.1</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: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: pt; padding-bottom: 0pt; background-color: #ffffff;">
<font style="opacity:100; position:relative; ">SECTION 302 CERTIFICATION PURSUANT TO</font>
<br>
<font style="opacity:100; position:relative; ">RULE 13a-14 AND 15d-14 UNDER</font>
<br>
<font style="opacity:100; position:relative; ">THE SECURITIES ACT OF 1934, AS AMENDED</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">
<font style="opacity:100; position:relative; ">I, Edward J. Fred, certify that:</font>
</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 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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">1.</font>&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; text-align: left;&#10;						width: 438pt;"><font style="opacity:100; position:relative; ">I have reviewed this Quarterly Report on Form 10-Q of CPI Aerostructures, Inc.;</font></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 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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">2.</font>&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; text-align: left;&#10;						width: 438pt;"><font style="opacity:100; position:relative; ">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;</font></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 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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">3.</font>&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; text-align: left;&#10;						width: 438pt;"><font style="opacity:100; position:relative; ">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 issuer as of, and for, the periods presented in this report;</font></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 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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">4.</font>&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; text-align: left;&#10;						width: 438pt;"><font style="opacity:100; position:relative; ">The issuer&rsquo;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 issuer and have:</font></td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="552"></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: 20pt;"></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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">(a)</font>&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; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">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 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;</font></td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="552"></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: 20pt;"></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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">(b)</font>&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; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">[intentionally omitted];</font></td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="552"></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: 20pt;"></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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">(c)</font>&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; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">Evaluated the effectiveness of the issuer&rsquo;s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and</font></td>
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<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="552"></td>
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<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 20pt;"></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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">(d)</font>&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; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">Disclosed in this report any change in the issuer&rsquo;s internal control over financial reporting that occurred during the issuer&rsquo;s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the issuer&rsquo;s internal control over financial reporting; and</font></td>
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<table cellpadding="0" cellspacing="0" border="0" width="602">
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<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="578"></td>
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<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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">5.</font>&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; text-align: left;&#10;						width: 438pt;"><font style="opacity:100; position:relative; ">The issuer&rsquo;s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuer&rsquo;s auditors and to the audit committee of the issuer&rsquo;s board of directors (or persons performing the equivalent functions):</font></td>
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<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="552"></td>
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<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: 20pt;"></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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">(a)</font>&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; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">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 issuer&rsquo;s ability to record, process, summarize and report financial information; and</font></td>
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<table cellpadding="0" cellspacing="0" border="0" width="602">
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<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="552"></td>
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<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: 20pt;"></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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">(b)</font>&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; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">Any fraud, whether or not material, that involves management or other employees who have a significant role in the issuer&rsquo;s internal control over financial reporting.</font></td>
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<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">
<font style="opacity:100; position:relative; ">Date: August&nbsp;14,&nbsp;2007</font>
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<td><img src="spacer.gif" height="1" width="309"></td>
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<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 204pt;"></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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">By:&nbsp;&nbsp;&nbsp;</font>&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; text-align: left;&#10;						width: 234pt;"><font style="opacity:100; position:relative; text-decoration:underline;">/S/ Edward J. Fred&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font>
<br>
<font style="opacity:100; position:relative; ">Name: Edward J. Fred</font>
<br>
<font style="opacity:100; position:relative; ">Title:&nbsp;&nbsp;&nbsp;Chief Executive Officer,</font>
<br>
<font style="opacity:100; position:relative; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;President and Secretary</font></td>
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<TYPE>EX-31.2
<SEQUENCE>5
<FILENAME>file5.htm
<DESCRIPTION>CERTIFICATION
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<font style="opacity:100; position:relative; font-weight: bold;font-style:normal;">EXHIBIT 31.2</font>
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<font style="opacity:100; position:relative; ">SECTION 302 CERTIFICATION PURSUANT TO</font>
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<font style="opacity:100; position:relative; ">RULE 13a-14 AND 15d-14 UNDER</font>
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<font style="opacity:100; position:relative; ">THE SECURITIES ACT OF 1934, AS AMENDED</font>
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<font style="opacity:100; position:relative; ">I, Vincent Palazzolo, certify that:</font>
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<table cellpadding="0" cellspacing="0" border="0" width="602">
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<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="578"></td>
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<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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">1.</font>&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; text-align: left;&#10;						width: 438pt;"><font style="opacity:100; position:relative; ">I have reviewed this Quarterly Report on Form 10-Q of CPI Aerostructures, Inc.;</font></td>
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<table cellpadding="0" cellspacing="0" border="0" width="602">
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<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="578"></td>
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<tr>
<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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">2.</font>&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; text-align: left;&#10;						width: 438pt;"><font style="opacity:100; position:relative; ">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;</font></td>
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<table cellpadding="0" cellspacing="0" border="0" width="602">
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<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="578"></td>
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<tr>
<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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">3.</font>&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; text-align: left;&#10;						width: 438pt;"><font style="opacity:100; position:relative; ">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 issuer as of, and for, the periods presented in this report;</font></td>
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<table cellpadding="0" cellspacing="0" border="0" width="602">
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<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="578"></td>
</tr>
<tr>
<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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">4.</font>&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; text-align: left;&#10;						width: 438pt;"><font style="opacity:100; position:relative; ">The issuer&rsquo;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 issuer and have:</font></td>
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<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="552"></td>
</tr>
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<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 20pt;"></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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">(a)</font>&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; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">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 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;</font></td>
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<table cellpadding="0" cellspacing="0" border="0" width="602">
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<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="552"></td>
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<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: 20pt;"></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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">(b)</font>&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; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">[intentionally omitted];</font></td>
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<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="552"></td>
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<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 20pt;"></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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">(c)</font>&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; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">Evaluated the effectiveness of the issuer&rsquo;s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and</font></td>
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<table cellpadding="0" cellspacing="0" border="0" width="602">
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<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="552"></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: 20pt;"></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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">(d)</font>&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; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">Disclosed in this report any change in the issuer&rsquo;s internal control over financial reporting that occurred during the issuer&rsquo;s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the issuer&rsquo;s internal control over financial reporting; and</font></td>
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<table cellpadding="0" cellspacing="0" border="0" width="602">
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<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="578"></td>
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<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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">5.</font>&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; text-align: left;&#10;						width: 438pt;"><font style="opacity:100; position:relative; ">The issuer&rsquo;s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuer&rsquo;s auditors and to the audit committee of the issuer&rsquo;s board of directors (or persons performing the equivalent functions):</font></td>
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<table cellpadding="0" cellspacing="0" border="0" width="602">
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<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="552"></td>
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<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 20pt;"></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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">(a)</font>&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; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">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 issuer&rsquo;s ability to record, process, summarize and report financial information; and</font></td>
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<table cellpadding="0" cellspacing="0" border="0" width="602">
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<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="552"></td>
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<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 20pt;"></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; text-align: left;&#10;						padding-left: 0pt;width: 18pt;"><font style="opacity:100; position:relative; ">(b)</font>&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; text-align: left;&#10;						width: 418pt;"><font style="opacity:100; position:relative; ">Any fraud, whether or not material, that involves management or other employees who have a significant role in the issuer&rsquo;s internal control over financial reporting.</font></td>
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<font style="opacity:100; position:relative; ">Date: August&nbsp;14,&nbsp;2007</font>
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<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; padding-top: 0;" valign="top" align="left" width="285"><img src="spacer.gif" height="1" width="285"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; padding-top: 0;" valign="top" align="left"><font style="opacity:100; position:relative; ">By:&nbsp;&nbsp;&nbsp;</font><font style="opacity:100; position:relative; text-decoration:underline;">/S/&nbsp;&nbsp;&nbsp;Vincent Palazzolo&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font>
<br>
<font style="opacity:100; position:relative; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name:&nbsp;&nbsp;&nbsp;Vincent Palazzolo</font>
<br>
<font style="opacity:100; position:relative; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title:&nbsp;&nbsp;&nbsp;&nbsp;Chief Financial Officer</font></td>
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<font style="opacity:100; position:relative; ">EXHIBIT 32</font>
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<font style="opacity:100; position:relative; ">CERTIFICATION PURSUANT TO</font>
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<font style="opacity:100; position:relative; ">18 U.S.C. SECTION 1350</font>
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<font style="opacity:100; position:relative; ">AS ADOPTED PURSUANT TO</font>
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<font style="opacity:100; position:relative; ">SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002</font>
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<font style="opacity:100; position:relative; ">In connection with the Quarterly Report of CPI Aerostructures, Inc. (the &lsquo;&lsquo;Company&rsquo;&rsquo;) on Form 10-Q for the period ended June&nbsp;30,&nbsp;2007 as filed with the Securities and Exchange Commission (the &lsquo;&lsquo;Report&rsquo;&rsquo;), 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:</font>
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<font style="opacity:100; position:relative; ">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</font>
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<font style="opacity:100; position:relative; ">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.</font>
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<td><img src="spacer.gif" height="1" width="174"></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Dated: August&nbsp;14,&nbsp;2007</font></font></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">/S/&nbsp;&nbsp;&nbsp;Edward J. Fred</font></font></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Edward J. Fred</font>
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<font style="opacity:100; position:relative; ">Chief Executive Officer, President and Secretary</font></font></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 24pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Dated: August&nbsp;14,&nbsp;2007</font></font></td>
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<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 24pt; background-color: #ffffff;	" align="right" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #000000;padding-left: 0pt; text-indent: 0pt; padding-top: 24pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">/S/&nbsp;&nbsp;&nbsp;Vincent Palazzolo</font></font></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
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<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">&nbsp;</font></font></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff; border-right: none"><img src="spacer.gif" width="1" height="1"></td>
<td style="background-color: #ffffff;border-bottom: 1px solid #ffffff"><img src="spacer.gif" width="1" height="1"></td>
<td style="font-size: 10pt; line-height:12pt; color: #000000; border-bottom: 1px solid #ffffff;padding-left: 0pt; text-indent: 0pt; padding-top: 0pt; background-color: #ffffff;	" align="left" valign="top" colspan="1"><font style="font-family: serif; font-size: 10pt; line-height:12pt; color: #000000; font-weight: normal; font-style: normal;background-color: #ffffff;"><font style="opacity:100; position:relative; ">Vincent Palazzolo</font>
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<font style="opacity:100; position:relative; ">Chief Financial Officer</font></font></td>
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