<SUBMISSION>
<ACCESSION-NUMBER>0001104659-02-006349
<TYPE>10-Q
<PUBLIC-DOCUMENT-COUNT>8
<PERIOD>20020930
<FILING-DATE>20021115
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>ALTERNATIVE RESOURCES CORP
<CIK>0000920521
<ASSIGNED-SIC>7363
<IRS-NUMBER>382791069
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>10-Q
<ACT>34
<FILE-NUMBER>000-23940
<FILM-NUMBER>02827598
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>100 TRI STATE INTERNATIONAL
<STREET2>STE 300
<CITY>LINCOLNSHIRE
<STATE>IL
<ZIP>60069
<PHONE>8473171000
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>75 TRI STATE INTERNATIONAL
<STREET2>STE 100
<CITY>LINCOLNSHIRE
<STATE>IL
<ZIP>60069
</MAIL-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>j5154_10q.htm
<DESCRIPTION>10-Q
<TEXT>
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<p style="border:none;margin:0in 0in .0001pt;padding:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



</div>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="5" face="Times New Roman" style="font-size:18.0pt;font-weight:bold;">SECURITIES AND EXCHANGE COMMISSION</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">WASHINGTON,

D.C. 20549</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="5" face="Times New Roman" style="font-size:18.0pt;font-weight:bold;">FORM 10-Q</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="3" face="Times New Roman" style="font-size:12.0pt;font-weight:bold;">QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934</font></b></p>



<p style="margin:0in 0in .0001pt .5in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt .5in;text-align:center;text-indent:-.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">For the quarterly period ended

September 30, 2002</font></b></p>



<p style="margin:0in 0in .0001pt .5in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt .5in;text-align:center;text-indent:-.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Commission file number 0-23940</font></b></p>



<p align="center" style="margin:0in 0in .0001pt .5in;text-align:center;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt .5in;text-align:center;text-indent:-.5in;"><font size="2" face="Times New Roman"><img width="479" height="70" src="j515410qimage002.jpg"></font></p>



<p align="center" style="margin:0in 0in .0001pt .5in;text-align:center;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt .5in;text-align:center;text-indent:-.5in;"><b><font size="5" face="Times New Roman" style="font-size:18.0pt;font-weight:bold;">ALTERNATIVE RESOURCES CORPORATION</font></b></p>



<p align="center" style="margin:0in 0in .0001pt .5in;text-align:center;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Exact name of registrant as specified in its charter)</font></p>



<p align="center" style="margin:0in 0in .0001pt .5in;text-align:center;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<div align="center">



<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">

 <tr>

  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.26%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Delaware</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.48%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.26%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">38-2791069</font></b></p>

  </td>

 </tr>

 <tr>

  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.26%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(State or other

  jurisdiction of<br>

  incorporation or organization)</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.48%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.26%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(I.R.S. Employer<br>

  Identification No.)</font></p>

  </td>

 </tr>

 <tr>

  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.26%;">

  <p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.48%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.26%;">

  <p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.26%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">600 Hart Road, Suite 300,

  Barrington, IL</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.48%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.26%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">60010</font></b></p>

  </td>

 </tr>

 <tr>

  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.26%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Address of principal

  executive offices)</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.48%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.26%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Zip code)</font></p>

  </td>

 </tr>

 <tr>

  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.26%;">

  <p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.48%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.26%;">

  <p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="100%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:100.0%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">(847) 381-6701</font></b></p>

  </td>

 </tr>

 <tr>

  <td width="100%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:100.0%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Registrant&#146;s telephone

  number, including area code)</font></p>

  </td>

 </tr>

</table>



</div>



<p align="center" style="margin:0in 0in .0001pt .5in;text-align:center;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">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.&#160;

YES&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font><font face="Wingdings" style="font-family:Wingdings;">&#253;</font>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NO&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<font face="Wingdings" style="font-family:Wingdings;">o</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Indicate the number of shares outstanding of each of the issuer&#146;s

classes of common stock, as of the latest practicable date:</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17,702,819

shares of Common Stock outstanding as of November 04, 2002.</font></p>



<div style="border:none;border-bottom:double windowtext 9.0pt;padding:0in 0in 0in 0in;">



<p style="border:none;margin:0in 0in .0001pt;padding:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



</div>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>





<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='',FILE='C:\C2\lnelson\5154_3\t_947606\j5154_10q.htm',USER='lnelsona',CD='Nov 14 13:06 2002' -->
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<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">ALTERNATIVE

RESOURCES CORPORATION</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">FORM

10-Q</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">INDEX</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;margin-left:-.15pt;width:100.02%;">

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>

  </td>

  <td width="6%" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:6.14%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Page</font></b></p>

  </td>

 </tr>

 <tr>

  <td width="8%" valign="top" style="padding:0in 0in 0in 0in;width:8.14%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#PartI" title="Click to goto PART I">PART I.</a></font></p>

  </td>

  <td width="85%" valign="top" style="padding:0in 0in 0in 0in;width:85.72%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Fin" title="Click to goto FIN">FINANCIAL INFORMATION</a></font></p>

  </td>

  <td width="6%" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;text-autospace:none;">&nbsp;</p>

  </td>

 </tr>

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  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;text-autospace:none;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="8%" valign="top" style="padding:0in 0in 0in 0in;width:8.14%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item1" title="Click to goto Item 1">Item 1.</a></font></p>

  </td>

  <td width="85%" valign="top" style="padding:0in 0in 0in 0in;width:85.72%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Fina" title="Click to goto Fina">Financial Statements</a></font></p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;text-autospace:none;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;text-autospace:none;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:.3in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Bal" title="Click to goto BAL">Consolidated

  Balance Sheets at September 30, 2002 (Unaudited) and December 31, 2001</a></font></p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3</font></p>

  </td>

 </tr>

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  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;text-autospace:none;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:.3in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Operations" title="Click to goto OPERATIONS">Consolidated Statements of Operations for

  the three and nine months ended September 30, 2002 and 2001 (Unaudited)</a></font></p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4</font></p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;text-autospace:none;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="margin:0in 0in .0001pt .3in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Income" title="Click to goto INCOME">Consolidated

  Statements of Comprehensive Income (Loss) for the three and nine months ended

  September 30, 2002 and 2001 (Unaudited)</a></font></p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5</font></p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;text-autospace:none;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:.3in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Cash" title="Click to goto CASH">Consolidated

  Statements of Cash Flows for the nine months ended September 30, 2002 and

  2001 (Unaudited)</a></font></p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6</font></p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;text-autospace:none;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:.3in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Notes" title="Click to goto NOTES">Notes

  to Consolidated Financial Statements (Unaudited)</a></font></p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7</font></p>

  </td>

 </tr>

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  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;text-autospace:none;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="8%" valign="top" style="padding:0in 0in 0in 0in;width:8.14%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item2" title="Click to goto Item 2">Item 2.</a></font></p>

  </td>

  <td width="85%" valign="top" style="padding:0in 0in 0in 0in;width:85.72%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Manage" title="Click to goto Manage">Management&#146;s Discussion and Analysis of

  Financial Condition and Results of Operations</a></font></p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11</font></p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;text-autospace:none;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="8%" valign="top" style="padding:0in 0in 0in 0in;width:8.14%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item3" title="Click to goto Item 3">Item 3.</a></font></p>

  </td>

  <td width="85%" valign="top" style="padding:0in 0in 0in 0in;width:85.72%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Quant" title="Click to goto Quant">Quantitative and Qualitative Disclosures About

  Market Risk.</a></font></p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15</font></p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;text-autospace:none;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="8%" valign="top" style="padding:0in 0in 0in 0in;width:8.14%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item4" title="Click to goto Item 4">Item 4.</a></font></p>

  </td>

  <td width="85%" valign="top" style="padding:0in 0in 0in 0in;width:85.72%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Control" title="Click to goto Control">Controls and Procedures</a></font></p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15</font></p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;text-autospace:none;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="8%" valign="top" style="padding:0in 0in 0in 0in;width:8.14%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#PartIi" title="Click to goto PART II">PART II.</a></font></p>

  </td>

  <td width="85%" valign="top" style="padding:0in 0in 0in 0in;width:85.72%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Other" title="Click to goto OTHER">OTHER INFORMATION</a></font></p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;text-autospace:none;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;text-autospace:none;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="8%" valign="top" style="padding:0in 0in 0in 0in;width:8.14%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item6" title="Click to goto Item 6">Item 6.</a></font></p>

  </td>

  <td width="85%" valign="top" style="padding:0in 0in 0in 0in;width:85.72%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Exh" title="Click to goto Exh">Exhibits and Reports on Form 8-K.</a></font></p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">16</font></p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;text-autospace:none;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Sign" title="Click to goto SIGN">SIGNATURES.</a></font></p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17</font></p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;text-autospace:none;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="93%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:93.86%;">

  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Certifications" title="Click to goto CERTIFICATIONS">CERFITICATIONS.</a></font></p>

  </td>

  <td width="6%" valign="bottom" style="padding:0in 0in 0in 0in;width:6.14%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">18</font></p>

  </td>

 </tr>

</table>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2</font></p>





<div style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='2',FILE='C:\C2\lnelson\5154_3\t_947606\j5154_10q.htm',USER='lnelsona',CD='Nov 14 13:06 2002' -->
<br clear="all" style="page-break-before:always;">

</font>



<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;">&nbsp;</p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;"><a name="PartI"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">PART I</font></b></a><b><font style="font-weight:bold;"> - <a name="Fin">FIN</a>ANCIAL INFORMATION</font></b></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt;"><a name="Item1"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Item 1</font></b></a><b><font style="font-weight:bold;">. - <a name="Fina">Fina</a>ncial Statements</font></b></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">ALTERNATIVE RESOURCES CORPORATION</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">CONSOLIDATED <a name="Bal">BAL</a>ANCE

SHEETS</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(In thousands, except

share data)</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">

 <tr>

  <td width="75%" valign="bottom" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p align="center" style="font-size:1.0pt;margin:0in 0in .0001pt 10.0pt;text-align:center;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">December

  31,<br>

  2001</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">September

  30,<br>

  2002</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="bottom" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p align="center" style="font-size:1.0pt;margin:0in 0in .0001pt 10.0pt;text-align:center;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="center" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">(Unaudited)</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p align="center" style="margin:0in 0in .0001pt 10.0pt;text-align:center;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">ASSETS</font></b></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Current assets:</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Cash and cash

  equivalents</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">127</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Trade accounts

  receivable, net of allowance for doubtful accounts</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">36,489</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">34,320</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Prepaid expenses</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,091</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,555</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Income taxes

  receivable</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,497</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3,035</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Other

  receivables</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">234</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">262</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total current

  assets</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">40,438</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">39,179</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Property and equipment:</font></b></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Office equipment</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8,270</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8,304</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Furniture and

  fixtures</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,389</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,389</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Software</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">19,355</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">19,650</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Leasehold

  improvements</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,972</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,014</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">31,986</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">32,357</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Less accumulated

  depreciation and amortization</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(17,394</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(20,595</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net property and

  equipment</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14,592</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11,762</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Other assets:</font></b></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Goodwill, net of

  amortization of $2,727</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,723</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,723</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Other assets</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,639</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,487</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total other

  assets</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,362</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5,210</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total assets</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">59,392</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">56,151</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p align="center" style="margin:0in 0in .0001pt 10.0pt;text-align:center;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">LIABILITIES

  AND STOCKHOLDERS&#146; EQUITY</font></b></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Current liabilities:</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Cash overdraft</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,404</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,294</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accounts payable</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">12,883</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11,169</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Payroll and

  related expenses</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7,861</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6,744</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accrued expenses</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,350</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8,252</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total current

  liabilities</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">27,498</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">28,459</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Long-term debt</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">26,877</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">27,050</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Other

  liabilities</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">358</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">359</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total

  liabilities</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">54,733</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">55,868</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Stockholders&#146; equity:</font></b></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Preferred stock,

  $.01 par value, 1,000,000 shares authorized; none issued and outstanding</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Common stock,

  $.01 par value, 50,000,000 shares authorized; 17,556,569 and 17,702,819

  shares issued at December 31, 2001 and September 30, 2002, respectively</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">176</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">178</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Additional

  paid-in capital</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">27,508</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">30,561</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Deferred

  compensation</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(97</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accumulated

  other comprehensive loss</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(44</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(48</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accumulated

  deficit</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(18,087</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(25,611</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9,456</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5,080</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Less: Treasury

  stock, at cost, 585,000 shares</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(4,797</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(4,797</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total

  stockholders&#146; equity</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,659</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">283</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total

  liabilities and stockholders&#146; equity</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">59,392</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">56,151</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

</table>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">See accompanying Notes to

Consolidated Financial Statements</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3</font></p>





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<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">ALTERNATIVE RESOURCES CORPORATION</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">CONSOLIDATED STATEMENTS OF <a name="Operations">OPERATIONS</a></font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(In thousands, except per

share data)</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">

 <tr>

  <td width="52%" valign="bottom" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p align="center" style="font-size:1.0pt;margin:0in 0in .0001pt 10.0pt;text-align:center;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="21%" colspan="5" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:21.7%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Three

  Months<br>

  Ended September 30,</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="21%" colspan="5" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:21.7%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Nine

  Months<br>

  Ended September 30,</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="bottom" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p align="center" style="font-size:1.0pt;margin:0in 0in .0001pt 10.0pt;text-align:center;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2001</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border-bottom:solid windowtext .5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2002</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2001</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border-bottom:solid windowtext .5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2002</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="bottom" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p align="center" style="font-size:1.0pt;margin:0in 0in .0001pt 10.0pt;text-align:center;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="21%" colspan="5" valign="bottom" style="padding:0in 0in 0in 0in;width:21.7%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">(Unaudited)</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="21%" colspan="5" valign="bottom" style="padding:0in 0in 0in 0in;width:21.7%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">(Unaudited)</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="bottom" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt 10.0pt;text-align:center;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="21%" colspan="5" valign="bottom" style="padding:0in 0in 0in 0in;width:21.7%;">

  <p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="21%" colspan="5" valign="bottom" style="padding:0in 0in 0in 0in;width:21.7%;">

  <p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Revenue</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">48,509</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">40,379</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">162,943</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">119,541</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Cost of services</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">34,423</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">29,388</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">116,749</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">86,554</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Gross profit</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14,086</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10,991</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">46,194</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">32,987</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Operating

  expenses:</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Selling, general

  and administrative expenses</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">12,520</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10,542</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">41,576</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">31,904</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Depreciation and

  amortization</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,294</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">997</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,132</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3,201</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Restructuring

  and other charges</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,650</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5,750</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 40.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total operating

  expenses</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13,814</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">16,189</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">45,708</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">40,855</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Income (loss)

  from operations</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">272</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(5,198</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">486</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(7,868</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Other income

  (expense), net</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1,048</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(959</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(2,922</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(2,698</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Loss before

  income taxes</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(776</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(6,157</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(2,436</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(10,566</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Income taxes</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(988</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(583</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(3,213</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net loss</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(776</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(5,169</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1,853</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(7,353</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:52.2%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net loss per

  share:</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Basic and

  diluted</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(0.05</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(0.30</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(0.11</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(0.43</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Shares used to

  compute net loss per share:</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Basic and

  diluted</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">16,679</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17,117</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">16,763</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17,087</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

</table>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">See accompanying Notes to

Consolidated Financial Statements</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4</font></p>





<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



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<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">ALTERNATIVE RESOURCES

CORPORATION</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">CONSOLIDATED STATEMENTS OF<br>

COMPREHENSIVE <a name="Income">INCOME</a> (LOSS)</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(In thousands)</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">

 <tr>

  <td width="52%" valign="bottom" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p align="center" style="font-size:1.0pt;margin:0in 0in .0001pt 10.0pt;text-align:center;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="21%" colspan="5" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:21.7%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Three

  Months<br>

  Ended September 30,</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="21%" colspan="5" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:21.7%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Nine

  Months<br>

  Ended September 30,</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="bottom" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p align="center" style="font-size:1.0pt;margin:0in 0in .0001pt 10.0pt;text-align:center;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2001</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="border:none;border-top:solid windowtext .5pt;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border-bottom:solid windowtext .5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2002</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2001</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="border:none;border-top:solid windowtext .5pt;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border-bottom:solid windowtext .5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2002</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="21%" colspan="5" valign="bottom" style="padding:0in 0in 0in 0in;width:21.7%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">(Unaudited)</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p align="center" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

  </td>

  <td width="21%" colspan="5" valign="bottom" style="padding:0in 0in 0in 0in;width:21.7%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">(Unaudited)</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="21%" colspan="5" valign="bottom" style="padding:0in 0in 0in 0in;width:21.7%;">

  <p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

  </td>

  <td width="21%" colspan="5" valign="bottom" style="padding:0in 0in 0in 0in;width:21.7%;">

  <p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net loss</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(776</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(5,169</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1,853</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(7,353</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Other

  comprehensive income (loss):</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Foreign currency

  translation adjustment, net of&#160; tax</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(4</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Unrealized

  holding gain on security, net of tax:</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Less

  reclassification adjustment for gain included in net loss</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(221</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" style="padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Other

  comprehensive loss</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(210</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(4</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:52.2%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Comprehensive

  loss</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(768</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(5,162</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(2,063</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(7,357</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

</table>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">See accompanying Notes to

Consolidated Financial Statements</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5</font></p>





<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">ALTERNATIVE RESOURCES CORPORATION</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">CONSOLIDATED STATEMENTS OF <a name="Cash">CASH</a> FLOWS</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(In thousands)</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">

 <tr>

  <td width="75%" valign="bottom" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p align="center" style="font-size:1.0pt;margin:0in 0in .0001pt 10.0pt;text-align:center;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="21%" colspan="5" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:21.7%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Nine

  Months Ended<br>

  September 30,</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="bottom" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p align="center" style="font-size:1.0pt;margin:0in 0in .0001pt 10.0pt;text-align:center;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2001</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border-bottom:solid windowtext .5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2002</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="bottom" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p align="center" style="font-size:1.0pt;margin:0in 0in .0001pt 10.0pt;text-align:center;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="21%" colspan="5" valign="bottom" style="padding:0in 0in 0in 0in;width:21.7%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">(Unaudited)</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Cash flows from operating

  activities:</font></b></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net loss</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" style="padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1,853</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" style="padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(7,353</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Adjustments to

  reconcile net loss to net cash provided by (used in) operating activities:</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Depreciation and

  amortization</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,132</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3,201</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Deferred income

  taxes</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(149</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Provision for

  doubtful accounts</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">350</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(133</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Realized gain on

  sale of security</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(221</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Deferred

  compensation on restricted shares</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">188</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">97</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Non-cash

  interest expense from deferred financing costs</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">379</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Non-cash

  interest expense from accretion of warrants</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">286</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Change in assets

  and liabilities:</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 40.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Trade accounts

  receivable</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">16,424</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,302</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 40.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Prepaid expenses</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">36</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">536</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 40.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Other

  receivables</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">32</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(28</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 40.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Other assets</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">167</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1,227</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 40.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accounts payable</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(2,042</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1,714</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 40.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Payroll and

  related expenses</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(3,207</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1,117</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 40.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accrued expenses

  and other liabilities</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(2,043</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5,903</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 40.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Income taxes</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,752</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1,538</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net cash

  provided by (used in) operating activities</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">16,566</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(406</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Cash flows from investing

  activities:</font></b></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Purchases of property

  and equipment</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1,647</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(370</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Redemption of

  available-for-sale securities</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">639</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net cash used in

  investing activities</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1,008</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(370</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Cash flows from financing

  activities:</font></b></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Proceeds from

  long-term debt</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">212,263</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">174,022</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Payments on

  long-term debt</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(225,644</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(181,132</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Proceeds from

  issuance of debt and warrants</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10,000</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Cash paid for

  cancellation of stockholder rights plan</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(171</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Contributions to

  employee stock purchase plan</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(57</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Proceeds from

  issuance of shares under the employee stock purchase plan</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">47</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">55</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Cash overdraft</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(2,216</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(2,110</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net cash

  provided by (used in) financing activities</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(15,607</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">664</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Effect of

  exchange rate changes on cash and cash equivalents</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(8</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net decrease in

  cash and cash equivalents</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(38</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(120</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Cash and cash

  equivalents at beginning of period</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">114</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">127</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Cash and cash

  equivalents at end of period</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">76</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Supplemental

  disclosures of cash flow information:</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Cash paid for

  interest</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3,162</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="8%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:8.7%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,086</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Cash paid for

  income taxes</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">133</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">30</font></p>

  </td>

  <td width="1%" valign="bottom" style="padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="75%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:75.6%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Cash refunds

  received for income taxes</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5,476</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="10%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.0%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,675</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in .7pt 0in;width:1.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

</table>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">See accompanying Notes to

Consolidated Financial Statements</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6</font></p>





<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



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<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">ALTERNATIVE RESOURCES CORPORATION</font></b></p>



<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;"><a name="Notes"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">NOTES</font></b></a><b><font style="font-weight:bold;"> TO

CONSOLIDATED FINANCIAL STATEMENTS</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">(UNAUDITED)</font></b></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 22.5pt;text-indent:-22.5pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">1.</font></b><b><font size="1" style="font-size:3.0pt;font-weight:bold;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Basis

of Presentation</b></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The

interim consolidated financial statements presented are unaudited, but in the

opinion of management, have been prepared in conformity with accounting

principles generally accepted in the United States of America applied on a

basis consistent with those of the annual financial statements.&#160; Such interim consolidated financial

statements reflect all adjustments (consisting principally of normal recurring accruals)

necessary for a fair presentation of the financial position and the results of

operations for the interim periods presented.&#160;

The results of operations for the interim periods presented are not

necessarily indicative of the results to be expected for the year ending

December 31, 2002.&#160; The interim

consolidated financial statements should be read in connection with the audited

consolidated financial statements for the year ended December 31, 2001,

included in the 2001 Form 10-K of Alternative Resources Corporation (&#147;ARC&#148; or

the &#147;Company&#148;).</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 22.5pt;text-indent:-22.5pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">2.</font></b><b><font size="1" style="font-size:3.0pt;font-weight:bold;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Computation

of Earnings (Loss) per Share</b></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Basic earnings (loss) per share is based on the

weighted average number of common shares outstanding for the period.&#160; Diluted earnings (loss) per share is based

on the weighted average number of common shares outstanding and includes the

dilutive effect of unexercised stock options and warrants which are

in-the-money using the treasury stock method.&#160;&#160;

Dilutive securities have not been included in the weighted average shares

used for the calculation of earnings per share in periods of net loss because

the effect of such securities would be anti-dilutive. At September 30, 2002 and

2001, potentially dilutive securities consisted of options to purchase 2.8

million and 2.5 million shares of common stock, respectively.&#160; In addition, the Company issued 11.0 million

warrants in connection with its refinancing described in note 4.&#160; These warrants are also potentially dilutive

securities.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 22.5pt;text-indent:-22.5pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">3.</font></b><b><font size="1" style="font-size:3.0pt;font-weight:bold;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Recently

Adopted Accounting Pronouncements</b></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In June 1999, the FASB issued

SFAS No. 133, &#147;Accounting for Derivative Instruments and Certain Hedging

Activities.&#148;&#160; In June 2000, the FASB

issued SFAS No. 138, &#147;Accounting for Certain Derivative Instruments and Certain

Hedging Activity, an Amendment of SFAS No. 133.&#148;&#160; SFAS No. 133 and SFAS No. 138 require that all derivative

instruments be recorded on the balance sheet at their respective fair values as

either liability or equity instruments, depending on certain criteria.&#160; The Company adopted SFAS No. 133 and SFAS

No. 138 on January 1, 2001, which did not have an impact on its financial

position or results of operations given the Company did not have any derivative

financial instruments at that time.&#160; As

described in note 4, the Company issued warrants in conjunction with the

issuance of Senior Subordinated Convertible Notes on January 31, 2002.&#160; Pursuant to SFAS 133 and interpretations by

the Emerging Issues Task Force covering derivative financial instruments, these

warrants meet the criteria for equity classification on the measurement date of

January 31, 2002 and the Company is not required to remeasure the warrants on

subsequent dates.&#160; As such, the fair

value of the warrants of approximately $3.0 million was recorded in equity as

additional paid-in capital.&#160; There was

no effect on results of operations for the nine months ended September 30, 2002

as a result of these pronouncements.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In June 2001, the Financial Accounting Standards Board

(&#147;FASB&#148;) issued Statement of Financial Accounting Standards (&#147;SFAS&#148;) No. 142,

&#147;Goodwill and Other Intangible Assets&#148; (&#147;SFAS 142&#148;), which supersedes

Accounting Principles Board (&#147;APB&#148;) Opinion No. 17, &#147;Intangible Assets.&#148;&#160; SFAS 142 addresses how intangible assets

that are acquired individually or with a group of other assets should be

accounted for in financial statements upon their acquisition. SFAS 142 also

addresses how goodwill and other intangible assets should be accounted for

after they have been initially recognized in the financial statements. The

provisions of SFAS 142 are required to be applied starting with fiscal years

beginning after December 15, 2001.&#160; SFAS

142 is required to be applied at the beginning of an entity&#146;s fiscal year to

all goodwill and other intangible assets recognized in its financial statements

at that date. As of January 1, 2002, the date of adoption, the Company has

unamortized goodwill in the amount of approximately $2.7 million, which has

been subjected to the transition provisions, including the phase-in impairment

test, of SFAS 142 and will not be amortized going forward.&#160; In the nine months ended September 30,2001,

amortization expense was approximately $57,000.&#160; Had this amortization not been recorded, the reported net loss of

$1,853,000 would have been</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7</font></p>





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</font></div>



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<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$1,796,000 with no effect on the reported loss per share of $0.11 for

the nine months ended September 30, 2001.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:37.5pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In July 2001, the FASB issued SFAS No. 141, &#147;Business

Combinations&#148; (&#147;SFAS 141&#148;), which supersedes APB Opinion No. 16, &#147;Business

Combinations,&#148; and SFAS No. 38, &#147;Accounting for Preacquisition Contingencies of

Purchased Enterprises.&#148;&#160; SFAS 141

addresses financial accounting and reporting for business combinations and

requires that all business combinations within the scope of SFAS 141 be

accounted for using only the purchase method. SFAS 141 is required to be

adopted for all business combinations initiated after June 30, 2001. As the

Company has not had any business combinations subsequent to June 30, 2001,

there is no impact to date of the adoption of SFAS 141 on the Company&#146;s

consolidated financial statements.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:37.5pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In October 2001, the FASB issued SFAS No. 144,

&#147;Accounting for the Impairment or Disposal of Long-Lived Assets&#148; (&#147;SFAS

144&#148;).&#160; SFAS 144 addresses financial

accounting and reporting for the impairment or disposal of long-lived

assets.&#160; While SFAS No. 144 supercedes

SFAS No. 121, &#147;Accounting for the Impairment of Long-Lived Assets and for

Long-Lived Assets to Be Disposed Of,&#148; it retains many of the fundamental

provisions of that Statement.&#160; SFAS 144

also supersedes the accounting and reporting provisions of APB Opinion No. 30,

&#147;Reporting the Results of Operations-Reporting the Effects of Disposal of a

Segment of a Business, and Extraordinary, Unusual and Infrequently Occuring

Events and Transactions,&#148; for the disposal of a segment of a business.&#160; However, it retains the requirement in

Opinion 30 to report separately discontinued operations and extends that

reporting to a component of an entity that either has been disposed of (by

sale, abandonment, or in a distribution to owners) or is classified as held for

sale.&#160; SFAS 144 is effective for the

fiscal years beginning after December 15, 2001 and interim periods within those

fiscal years.&#160; SFAS 144 was adopted on

January 1, 2002 and had no effect on the consolidated financial statements.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In December 2001, the FASB issued Topic No. D-103,

&#147;Income Statement Characterization of Reimbursements Received for

&#147;Out-of-Pocket&#148; Expenses Incurred&#148; (&#147;Topic D-103&#148;), subsequently recharacterized

as Emerging Issues Task Force &#147;EITF&#148; No. 01-14, which is effective for fiscal

years beginning after December 15, 2001.&#160;

EITF No. 01-14 requires that certain out-of-pocket expenses rebilled to

customers be recorded as revenue versus an offset to the related expense.&#160; Comparative financial statements for prior

periods must be conformed to this presentation.&#160; The Company historically recorded rebilled out-of-pocket expenses

as an offset to the related expense. Effective January 1, 2002, the Company changed

its presentation to reflect rebilled expenses as revenue and also conformed the

presentation for prior periods. The impact of adopting this pronouncement

resulted in the reclassification of $1.7 million of expenses to revenue for

both of the three months ended September 30, 2001 and 2002, with a

corresponding decrease of approximately 1.0% and 1.2% in gross margin for the

three months ended September 30, 2001 and 2002, respectively. The impact of

adopting this pronouncement resulted in the reclassification of $5.5 million

and $4.6 million of expenses to revenue with a corresponding decrease of

approximately 1.0% and 1.1% in gross margin for the nine months ended September

30, 2001 and 2002, respectively.&#160; Cost of

services were increased by an equal amount with no impact on gross profit

dollars.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt 22.5pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Recent Accounting Pronouncements, Not Yet Adopted</font></b></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In July 2002, the FASB issued SFAS No. 146,

&#147;Accounting for Costs Associated with an Exit or Disposal Activity,&#148; which

supercedes EITF No. 94-3 &#147;Liability Recognition for Certain Employee

Termination Benefits and Other Costs to Exit an Activity (Including Certain

Costs Incurred in a Restructuring),&#148; which is effective for exit or disposal

activities initiated after December 31, 2002.&#160;

SFAS No. 146 requires that a company record a liability when that

liability is incurred and can be measured at fair value.&#160; Incurred is defined as when an event

obligates the entity to transfer or use assets.&#160; The recognition of termination benefits to employees will depend

on whether additional service is required of the employee.&#160; If the employee must continue to provide

service for a period of at least a minimum of sixty days in order to be

eligible for the benefits (called a &#147;minimum retention period&#148;), the fair value

of the benefits should be accrued over the time the employee renders the

service.&#160; If future service beyond a

minimum retention period is not required, the liability for the fair value of

the benefits should be recognized at the time the company communicates the

arrangement to the employees.&#160; The

Company will adopt this statement in the year beginning January 1, 2003.</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8</font></p>





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<h5 style="margin:0in 0in .0001pt 22.5pt;page-break-after:auto;text-indent:-22.5pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.</font></b><font size="1" face="Times New Roman" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" face="Times New Roman" style="font-size:10.0pt;">Long-term

borrowings</font></h5>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During 1997, the Company entered into a $53.5 million

revolving credit facility. As of December 31, 2001, borrowings under the

revolving credit facility were $26.9 million. As part of this agreement, cash

receipts into the Company&#146;s bank accounts were directly applied against the

outstanding bank line of credit balance.&#160;

Advances from the line of credit were determined on a daily basis to

minimize the Company&#146;s average debt balance.&#160;

The revolving credit facility expired on January 31, 2002.&#160; The Company did not extend this credit

facility and successfully refinanced the debt on a long-term basis as described

below.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">On January 31, 2002, the Company entered into a Senior

Secured Revolving Credit facility with a lending institution, that provides for

up to $30.0 million of revolving credit based on the Company&#146;s available

collateral base.&#160; This facility was

reduced to $28.0 million in August 2002 as discussed below.&#160; The credit facility has a three-year term

and bears interest at LIBOR plus 3.25% or the lenders&#146; base rate plus

1.00%.&#160; As of September 30, 2002, the

applicable rates are as follows: $17,000,000 at 5.02%, which represents LIBOR

plus 3.25%, with the remainder of the facility at 5.75%, which represents the

bank&#146;s base rate plus 100 basis points.&#160;

The initial proceeds of this facility together with the net proceeds

from the sale of convertible subordinated notes described below were used to

repay the Company&#146;s existing credit facility.&#160;

Advances from the revolving credit facility are determined on a daily

basis to minimize the Company&#146;s average debt balance.&#160; As of September 30, 2002 the Company has $2.3 million in excess

availability.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">On January 31, 2002, the Company also entered into a

Securities Purchase Agreement with a private equity investor, pursuant to which

the Company sold $10 million principal amount of 15% Senior Subordinated

Convertible Notes due January 31, 2009.&#160;

These notes are convertible into common stock of the Company at a

conversion price of $2.50 per share.&#160; At

the Company&#146;s election, one half of the interest may be deferred during the

first four years, subject to certain conditions.&#160; Effective August 8, 2002, the Company and the private equity

investor agreed to defer all of the interest.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In conjunction with the sale of these notes, the

Company issued 10,000,000 warrants (immediately exercisable) to the private

equity investor to purchase shares of the Company&#146;s common stock at $0.55 per

share.&#160; Additional 1,000,000 warrants to

purchase its common stock at $0.73 per share, are not exercisable for one year

contingent upon the Company meeting certain performance measures, however, the

warrants expire if such performance measures are met.&#160; As of September 30, 2002, it is not likely that the Company will

meet the specific performance measures related to the 1,000,000 contingent

warrants and these warrants will not expire. A fair value was required to be

ascribed to these warrants and recorded as a decrease in the debt and an

increase to additional-paid-in-capital.&#160;

This value is then amortized over the seven-year life of the debt by a

non-cash interest charge. &#160;The fair

value of these warrants was determined to be approximately $3.0 million and

will result in a non-cash quarterly interest charge of approximately $107,000

($70,000 for the three months ended March 31, 2002).&#160; The valuation of the warrants was determined based on advice from

third-party valuation specialists who utilized a valuation model with the

following inputs: measurement date of Janaury 31, 2002; fair value of $0.80;

exercise price of $0.55 ($0.73 for contingent warrants); contractual term of 10

years; dividend rate of zero; volatility rate of 101%; risk-free rate of 5.49%;

and probability of 70% (for contingent warrants only).&#160; The value assigned to the warrants is

subject to the finalization of the valuation advice and review by

management.&#160; Any changes, unless

material, will be adjusted in the financial statements prospectively.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In conjunction with the Securities Purchase Agreement

on January 31, 2002, the Company&#146;s Board of Directors redeemed all of the

rights issued under its stockholder rights plan.&#160; Each share of the Company&#146;s common stock carried with it one

right to purchase a fraction of a share of the Company&#146;s preferred stock in

certain circumstances described in the Stockholder Rights Plan.&#160; The rights were attached to, and could not

be separated from, shares of the Company&#146;s common stock.&#160; The Company paid a redemption payment of

$0.01 per right to stockholders on February 8, 2002, at a total cost of

approximately $171,000.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In August 2002, ARC and the lending institution

executed an amendment to the revolving credit agreement.&#160; The impact of this amendment was to reduce

the borrowing limit subject to pledged accounts receivable as collateral to

$28.0 million in consideration for the waiver of existing financial loan

covenants.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In November 2002, ARC and the lending institution

executed an amendment to the revolving credit agreement.&#160; The impact of this amendment was to obtain a

waiver of existing financial loan covenants.&#160;

Additionally, financial loan covenant calculations were redefined for

future periods.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In August 2002, ARC and the private equity investor

executed an amendment to the Security Purchase Agreement.&#160; The impact of this amendment was to

acknowledge the amendment made with the lending institution as well as to defer

all interest payments.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">As of September 30, 2002, the Company has two

irrevocable standby letters of credit for $1,268,000, which expire on December

31, 2002.</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9</font></p>





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<h5 style="margin:0in 0in .0001pt 22.5pt;page-break-after:auto;text-indent:-22.5pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.</font></b><font size="1" face="Times New Roman" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" face="Times New Roman" style="font-size:10.0pt;">Other

Charges</font></h5>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During

the second quarter of 2002 the Company recorded a charge of $1.1 million which

represents the severance pay associated with the departure of the Company&#146;s

former Chief Executive Officer.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<h5 style="margin:0in 0in .0001pt 22.5pt;page-break-after:auto;text-indent:-22.5pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">6.</font></b><font size="1" face="Times New Roman" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" face="Times New Roman" style="font-size:10.0pt;">Restructuring

Charge</font></h5>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During

the third quarter of 2002, the Company decided to restructure its service

delivery function by eliminating the client support organization.&#160; This organization was primarily responsible

for facilitating the administrative tasks associated with the Company&#146;s

billable consulting staff as well as being the liaison between the technical

consultants and the Company.&#160; After an

extensive study, the Company proceeded to establish an enterprise-wide service

center which will be responsible for all the administrative functions for the

technical consultants.&#160; The account managers

will assume the liaison role with the technical consultants.&#160; The Company believes this will make for a

more effective and cost efficient organization.&#160; The Company recorded a $4.7 million restructuring charge during

the third quarter of 2002.&#160; The primary

components of the restructuring charge can be summarized as follows:</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<table border="0" cellspacing="0" cellpadding="0" width="70%" style="border-collapse:collapse;font-family:'Courier New';width:70.0%;">

 <tr>

  <td width="52%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:52.88%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">In thousands</font></b></p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:2.56%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:12.3%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Total<br>

  Initial<br>

  Reserve</font></b></p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:2.54%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:12.3%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2002<br>

  Cash<br>

  Payments</font></b></p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:2.54%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:12.32%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Balance at<br>

  September<br>

  30, 2002</font></b></p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:2.52%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in .7pt 0in .7pt;width:52.88%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Real

  estate costs</font></p>

  </td>

  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in .7pt 0in .7pt;width:2.56%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:1.84%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="10%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-top:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:10.48%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,328</font></p>

  </td>

  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in .7pt 0in .7pt;width:2.54%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:1.84%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="10%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-top:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:10.48%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>

  </td>

  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in .7pt 0in .7pt;width:2.54%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:1.84%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="10%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-top:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:10.48%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,328</font></p>

  </td>

  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in .7pt 0in .7pt;width:2.52%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" style="padding:0in .7pt 0in .7pt;width:52.88%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Severance</font></p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:2.56%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:12.3%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">322</font></p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:2.54%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:12.3%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(59</font></p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:2.54%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:12.32%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">263</font></p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:2.52%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="52%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in .7pt 0in .7pt;width:52.88%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total</font></p>

  </td>

  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in .7pt 0in .7pt;width:2.56%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in .7pt 0in .7pt;width:1.84%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="10%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:10.48%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,650</font></p>

  </td>

  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in .7pt 0in .7pt;width:2.54%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in .7pt 0in .7pt;width:1.84%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="10%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:10.48%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(59</font></p>

  </td>

  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in .7pt 0in .7pt;width:2.54%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>

  </td>

  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in .7pt 0in .7pt;width:1.84%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>

  </td>

  <td width="10%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:10.48%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,591</font></p>

  </td>

  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in .7pt 0in .7pt;width:2.52%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

</table>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The portion of the

charge related to real estate costs, which totaled $4.4 million, relates to

lease costs associated with decreased utilization of office space as the

Company restructured its service delivery organization. The costs associated

with this charge related primarily to the value of ongoing lease obligations

for vacated offices, net of anticipated sublease income.&#160; A portion of the charge also related to

broker commissions and estimated leasehold improvement costs necessary to

sublease vacated offices.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The $0.3 million

severance charge related to head-count reductions associated with centralizing

the service delivery organization as part of a re-engineering exercise.&#160; A total of 60 positions were eliminated with

the largest group being the client staffing managers.&#160; The remainder of positions eliminated was a mix of corporate

staff and recruiting personnel. The Company has offered stay bonuses to certain

employees to continue employment through a certain date.&#160; This additional expense of approximately

$0.3 million will be recognized through the term of the employee&#146;s remaining

employment, which is expected to end during the fourth quarter of 2002.&#160; In 2003, operating expenses are expected to

be reduced by approximately $4.7 million based on the restructuring actions

described above.&#160; There is no impact on

cash flows until the leases expire.</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10</font></p>





<div style="margin:0in 0in .0001pt;text-indent:0in;"><font size="1" face="Courier New" style="font-size:8.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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</font>



<p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>



<h5 style="margin:0in 0in .0001pt;page-break-after:auto;"><a name="Item2"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Item 2</font></b></a><font size="2" face="Times New Roman" style="font-size:10.0pt;">.

&#150; <a name="Manage">Manage</a>ment&#146;s Discussion and Analysis of Financial

Condition and Results of Operations</font></h5>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<h2 style="margin:0in 0in .0001pt;page-break-after:auto;text-decoration:underline;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;">Results

of Operations</font></u></b></h2>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Essentially all of the Company&#146;s revenue is generated

from information technology services that offer the benefits of outsourcing,

while allowing information services operations managers to retain strategic

control of their operations. Revenues are recognized as services are performed,

utilizing four different billing methodologies as follows:&#160; (1) time and material billing, whereby the

client is billed by the hour on a weekly basis for past services performed; (2)

project-based billing, for which fees are fixed and are based on specific

contracts; (3) per-incident billing, whereby the Company charges a fee for each

specific task related to certain services; (4) and fee-based billing, which is

used for candidate placement/recruiting fees and vendor management fees.&#160;&#160; The Company typically provides discounts on

staffing services to its largest clients in exchange for the opportunity to

sell more volume, as well as the opportunity to sell its higher-margin,

value-added services.&#160; All revenues are

recognized net of such discounts and after services have been completed.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<h1 style="margin:0in 0in .0001pt;page-break-after:auto;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Third

Quarter Fiscal 2002 Compared to Third Quarter Fiscal 2001</font></b></h1>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Revenue.</font></b>&#160;

Revenues consist of fees earned from the Company&#146;s IT Staffing business

and it&#146;s IT Solutions business. Revenue for the third quarter of 2002 was $40.4

million, which was down from $48.5 million in the third quarter of 2001. The IT

Staffing revenue was $18.2 million, down from $31.5 million last year and the

IT Solutions revenue was $22.2 million, up from $17.0 million last year.&#160; The increase in the Solutions revenue is

primarily the result of increased technology deployments and smartsourcing

engagements during the quarter.&#160; The

Solutions revenue includes a reclassification of $1.5 million in the third

quarter of 2002 and 2001. This reclassification represents out-of-pocket

expenses that were rebilled to customers and previously recorded as an offset

to the related expense and now included in revenue as required by the recent

EITF No. 01-14, &#147;Income Statement Characterization of Reimbursements for

&#147;Out-of-Pocket&#148; Expenses Incurred.&#148; Cost of services were increased by an equal

amount with no impact on the dollar value of gross profit.&#160; The IT Staffing revenues dropped by 42.1%

from the prior year. This decrease was driven by significant declines in

outsourced staffing requirements from IBM and EDS, two of our largest staff

augmentation customers. IT Staffing revenue also includes $0.2 million

reclassified for EITF No. 01-14 in the third quarter of 2002 and 2001.</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Gross margin. </font></b>&#160;Gross margin for the third quarter was $11.0 million or 27.2%,

down from $14.1 million or 29.0% in the third quarter of last year.&#160; The decrease in margin from the third quarter

of 2002 is due to the very competitive IT staffing environment, which is

causing some margin pressure in all service offerings.</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operating expenses.&#160; </font></b>Operating

expenses consist of sales and marketing costs, recruiting, retention and

training costs, management and administrative costs, and depreciation and

amortization.&#160; Operating expenses

decreased by $2.2 million or 16.0% from $13.8 million in 2001 to $11.6 million

in 2002.&#160; The operating expense decrease

was attributable to the restructuring actions the Company has taken in the

past, which is reflected in reduced office space and lower headcount. As a

percentage of revenues, operating expenses increased by 0.2% from 28.5% in 2001

to 28.7% in 2002, primarily as a result of the sharp decline in revenue.</p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Restructuring charge. </font></b><font size="2" face="Times New Roman" style="font-size:10.0pt;">During

the third quarter of 2002, the Company decided to restructure its service

delivery function by eliminating the client support organization.&#160; This organization was primarily responsible

for facilitating the administrative tasks associated with the Company&#146;s

billable consulting staff as well as being the liaison between the technical

consultants and the Company.&#160; After an

extensive study, the Company proceeded to establish an enterprise-wide service

center which will be responsible for all the administrative functions for the

technical consultants.&#160; The account

managers will assume the liaison role with the technical consultants.&#160; The Company believes this will make for a

more effective and cost efficient organization.&#160; The Company recorded a $4.7 million restructuring charge during

the third quarter of 2002.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The portion of the charge related to real estate

costs, which totaled $4.4 million, relates to lease costs associated with

decreased utilization of office space as the Company restructured its service

delivery organization. The costs associated with this charge related primarily

to the value of ongoing lease obligations for vacated offices, net of

anticipated sublease income.&#160; A portion

of the charge also related to</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11</font></p>





<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">broker commissions and estimated leasehold improvement costs necessary

to sublease vacated offices.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The $0.3 million severance charge related to

head-count reductions associated with centralizing the service delivery

organization as part of a re-engineering exercise.&#160; A total of 60 positions were eliminated with the largest group

being the client staffing managers.&#160; The

remainder of positions eliminated was a mix of corporate staff and recruiting

personnel. The Company has offered stay bonuses to certain employees to

continue employment through a certain date.&#160;

This additional expense of approximately $0.3 million will be recognized

through the term of the employee&#146;s remaining employment, which is expected to

end during the fourth quarter of 2002.&#160;

The savings expected from this headcount reduction will be approximately

$2.5 million and will be fully realized during 2003.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Other (income) expense, net.&#160;

</font></b>Other (income) expense consists primarily of interest

expense on the Company&#146;s outstanding debt. Other (income) expense, net

decreased by $0.1 million in the third quarter of 2002 from $1.0 million in

2001 to $0.9 million in 2002. The decrease in other expense is primarily the

result of a decrease in interest expense related to decreased debt levels and

lower interest rates.</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Income

taxes. </font></b>&#160;During the

third quarter of 2002, the Company recorded a tax benefit of $1.0 million due

to recently enacted Federal tax legislation. The new legislation provides for a

five-year carry back of the Company's operating loss rather than the two years

permitted under prior legislation.</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<h1 style="margin:0in 0in .0001pt;page-break-after:auto;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">First

Nine Months Fiscal 2002 Compared to First Nine Months Fiscal 2001</font></b></h1>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Revenue.</font></b><font size="2" style="font-size:10.0pt;">&#160;

Revenues consist of fees earned from the Company&#146;s IT Staffing business

and it&#146;s IT Solutions business. Revenue decreased by $43.4 million from $162.9

million in 2001 to $119.5 in 2002. The IT Staffing revenue was $61.2 million,

down from $112.0 million last year and the IT Solutions revenue was $58.3

million, up from $51.0 million last year. The increase in the Solutions revenue

is due to increased technology deployments, smartsourcing, and field services

during the year. The Solutions revenue includes a reclassification of $4.1

million in the nine months of 2002 and a similar reclassification of $3.8

million in the nine months of 2001. This reclassification represents

out-of-pocket expenses that were rebilled to customers and previously recorded

as an offset to the related expense and now included in revenue as required by

the recent EITF No. 01-14, &#147;Income Statement Characterization of Reimbursements

for &#147;Out-of-Pocket&#148; Expenses Incurred.&#148; Cost of services were increased by an

equal amount with no impact on the dollar value of gross profit.&#160; The IT Staffing revenues dropped by 45.3%

from the prior year. This decrease was driven by significant declines in

outsourced staffing requirements from IBM and EDS, two of our largest staff

augmentation customers. IT Staffing revenue also includes $0.5 million

reclassified for EITF No. 01-14 in the nine months of 2002 and $0.7 million in

the nine months of 2001.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Gross margin.</font></b>&#160; Gross margin for the nine months ended September 30, 2002 was

$33.0 million or 27.6%, down from $46.2 million or 28.3% for the nine months

ended September 30, 2001. The decrease in margin in 2002 is due to the very

competitive IT staffing environment, which is causing some margin pressure in

our staffing business. This is partially offset by the margins in the IT

Solutions business, which have shown some improvement over the nine months of

last year.</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operating expenses.</font></b>&#160; Operating expenses consist of sales and

marketing costs, recruiting, retention and training costs, management and

administrative costs, and depreciation and amortization.&#160; Operating expenses decreased by $10.5

million or 23.1% from $45.7 million in 2001 to $35.1 million in 2002.&#160; The operating expense decrease was

attributable to the restructuring actions taken in 2000, which is reflected in

reduced office space and lower headcount.&#160;

As a percentage of revenues, operating expenses increased by 1.3% from

28.1% in 2001 to 29.4% in 2002, primarily as a result of the sharp decline in

revenue.</p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Restructuring charge. </font></b><font size="2" face="Times New Roman" style="font-size:10.0pt;">During

the third quarter of 2002, the Company decided to restructure its service

delivery function by eliminating the client support organization.&#160; This organization was primarily responsible

for facilitating the administrative tasks associated with the Company&#146;s

billable consulting staff as well as being the liaison between the technical

consultants and the Company.&#160; After an

extensive study, the Company proceeded to establish an enterprise-wide service

center which will be responsible for all the administrative functions for the

technical consultants.&#160; The account

managers will assume the liaison role with the technical consultants.&#160; The Company believes this will make for a

more effective and cost efficient organization.&#160; The Company recorded a $4.7 million restructuring charge during

the third quarter of 2002.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The portion of the

charge related to real estate costs, which totaled $4.4 million, relates to

lease costs associated with decreased utilization of office space as the

Company restructured its service delivery organization. The costs associated

with this charge related primarily to the value of ongoing lease obligations

for vacated</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">12</font></p>





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<p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">offices,

net of anticipated sublease income.&#160; A

portion of the charge also related to broker commissions and estimated

leasehold improvement costs necessary to sublease vacated offices.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The $0.3 million

severance charge related to head-count reductions associated with centralizing

the service delivery organization as part of a re-engineering exercise.&#160; A total of 60 positions were eliminated with

the largest group being the client staffing managers.&#160; The remainder of positions eliminated was a mix of corporate

staff and recruiting personnel. The Company has offered stay bonuses to certain

employees to continue employment through a certain date.&#160; This additional expense of approximately

$0.3 million will be recognized through the term of the employee&#146;s remaining

employment, which is expected to end during the fourth quarter of 2002.&#160; The savings expected from this headcount

reduction will be approximately $2.5 million and will be fully realized during

2003.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Other charges.</font></b> During the second quarter of

2002, the Company recorded a charge of $1.1 million which represents the

severance pay associated with the departure of the Company&#146;s former Chief

Executive Officer.&#160; There was no similar

charge in the prior year.</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Other (income) expense, net. </font></b>In 2002, other

(income) expense consists primarily of interest expense on the Company&#146;s

outstanding debt. In 2001, other (income) expense, net consisted of interest

expense of $3.6 million on the Company&#146;s revolving credit facility offset by

interest income on the Company&#146;s tax refund and a $0.4 million pre-tax gain on

the sale of stock that was distributed to ARC from its health care provider,

MetLife, as it transitioned from a mutual company to a public company.</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Income

taxes.</font></b>&#160; For the nine

months ended September 30, 2002, the Company recorded a tax benefit of $3.2

million due to recently enacted Federal tax legislation.&#160; The new legislation provides for a five-year

carry back of the Company's operating loss rather than the two years permitted

under prior legislation.</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<h1 style="margin:0in 0in .0001pt;page-break-after:auto;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Liquidity

and Capital Resources</font></b></h1>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">On January 31, 2002, the Company replaced its existing

bank line with a $30.0 million senior secured revolving credit facility with

Fleet Capital, a subsidiary of the FleetBoston Financial Corporation and $10.0

million principal amount of Senior Subordinated Convertible Notes sold to

Wynnchurch Capital Partners, a private equity investor. The $30.0 million

revolving credit facility is secured by the assets of the Company, principally

consisting of accounts receivable.&#160; In

August 2002, ARC and Fleet Capital executed an amendment to the revolving

credit agreement. The impact of this amendment was to reduce the borrowing

limit subject to pledged accounts receivable as collateral to $28.0 million in

consideration for the waiver of existing financial loan covenants.&#160; The agreement has a three-year term and

bears interest at LIBOR plus 325 basis points or the bank&#146;s base rate plus 100

basis points. As of September 30, 2002, the applicable rates are as follows:

$17,000,000 at 5.02%, which represents LIBOR plus 3.25%, with the remainder of

the facility at 5.75%, which represents the bank&#146;s base rate plus 100 basis

points.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:37.5pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Senior Subordinated Convertible Notes bear

interest at 15% and are due January 31, 2009. These notes are convertible into

common stock at a conversion price of $2.50 per share. At the Company&#146;s

election, one-half of the interest may be deferred during the first four years,

subject to certain conditions.&#160; In

conjunction with the sale of these notes, the Company issued 10,000,000

warrants to purchase shares of the Company&#146;s common stock at $0.55 per share.

Additional 1,000,000 warrants to purchase its common stock at $0.73 per share,

are not exercisable for one year contingent upon the Company meeting certain

performance measures, however, the warrants expire if such performance measures

are met.&#160; As of September 30, 2002, it

is not likely that the Company will meet the specific performance measures

related to the 1,000,000 contingent warrants and these warrants will not

expire.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Current assets exceed current liabilities by $10.7

million at September 30, 2002.&#160; Net cash

used in operations was $0.4 million in the first nine months of 2002.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Capital spending was approximately $0.4 million for

the nine months ended September 30, 2002 and $1.6 million for the nine months

ended September 30, 2001. The Company does not anticipate that its&#146; capital

spending going forward will be significantly greater than $2.0 million to $3.0

million per annum.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company reported a tax benefit of $0.9 million in

the third quarter; $1.3 million in the second quarter; and $1.0 million in the

first quarter of 2002 due to recently enacted federal tax legislation.&#160; The new legislation provides for a five-year

carry back of the Company&#146;s operating loss rather than the two years permitted

under the prior legislation.&#160; The

Company intends to use the cash generated from the anticipated income tax

refund for general operating purposes, including the reduction of debt.</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13</font></p>





<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



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</font></div>



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<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company believes its cash balances and funds from

operations together with funds available under its new credit facility will be

sufficient to meet all of its anticipated cash requirements for at least the

next 12 months.&#160; However, general

economic and industry conditions could impact the Company&#146;s ability to meet

anticipated cash requirements.&#160; Since

the existing credit facility is secured by the assets of the Company,

principally consisting of accounts receivable, these uncertainties may directly

impact the availability of this credit facility.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">CRITICAL

ACCOUNTING POLICIES</font></b></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company&#146;s consolidated financial statements are

impacted by the accounting policies used,

and the estimates and assumptions made by management.&#160; The most significant accounting policies and management estimates

that affect the presentation of the consolidated financial statements include

revenue recognition, allowance for doubtful accounts, analysis of goodwill

impairment and valuation allowance for deferred tax assets.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Revenue

Recognition</font></b></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company recognizes revenues as services are

performed, utilizing four different billing methodologies, as follows:&#160; (1) time and material billing, whereby the

client is billed by the hour on a weekly basis for past services performed; (2)

project-based billing, for which fees are fixed and are based on specific

contracts; (3) per-incident billing, whereby the Company charges a fee for each

specific task related to certain services; (4) and fee-based billing, which is

used for candidate placement/recruiting fees and vendor management fees.&#160;&#160; The Company typically provides discounts on

staffing services to its largest clients in exchange for the opportunity to

sell more volume, as well as the opportunity to sell its higher-margin,

value-added services.&#160; All revenues are

recognized net of such discounts and after services have been completed.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Allowance

for Doubtful Accounts</font></b></p>



<p style="margin:0in 0in .0001pt;text-indent:33.75pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company </font>performs ongoing credit evaluations of its customers and adjusts

credit limits based upon payment history and the customers&#146; current credit

worthiness.&#160; The Company continuously

monitors collections and payments from its customer base and maintains a provision

for estimated credit losses based upon historical experience and any specific

customer collection issues that have been identified.&#160; The Company specifically reviews outstanding account balances

that are overdue 90 days or more in making its assessment of the provision for

bad debts in each period.&#160; While the

Company has historically had sufficient coverage of allowances for credit

losses, it cannot guarantee that it will continue to experience the same credit

loss rates as in past periods.</p>



<p style="margin:0in 0in .0001pt;text-indent:33.75pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Goodwill Impairment</font></b></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">On January 1, 2002, the Company adopted SFAS No. 142,

&#147;Goodwill and Other Intangible Assets&#148; (&#147;SFAS 142&#148;).&#160; This Statement dictates that goodwill and intangible assets with

indefinite useful lives should be tested and written down for impairment at

least annually, instead of being amortized on an ongoing basis.&#160; The Company has terminated its policy of

amortizing goodwill on a monthly basis and will perform an annual analysis of

goodwill impairment, using the discounted future cash flows methodology

prescribed by SFAS No. 142.&#160; The Company

adopted SFAS 142 in 2002 and has determined there was no impairment and thus no

impact on its financial statements.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Valuation Allowance for Deferred Tax Asset</font></b></p>



<p style="margin:0in 0in .0001pt;text-indent:33.75pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company records a valuation allowance to reduce

its deferred tax assets to the amount that it believes is more likely than not

to be realized.&#160; This valuation

allowance is recorded based on the uncertainty with respect to the future

realization of deferred tax assets, particularly the net operating losses, and

the lack of ability to accurately forecast taxable income over the 20 year net

operating loss carryforward period.&#160;

When a valuation allowance is deemed necessary, the Company records an

adjustment to the deferred tax asset, with a corresponding charge to the

statement of operations.&#160; In the event

that the Company determines that it would be able to realize its deferred tax

assets in the future in excess of its net recorded amount, an adjustment to the

deferred tax assets would increase income, or reduce a net loss, in the period

such determination was made.</font></p>



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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14</font></p>





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<h5 style="margin:0in 0in .0001pt;page-break-after:auto;"><a name="Item3"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Item 3</font></b></a><font size="2" face="Times New Roman" style="font-size:10.0pt;">.

&#150; <a name="Quant">Quant</a>itative and Qualitative Disclosures About Market Risk</font></h5>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The market risk that the Company is exposed to

primarily relates to changes in interest rates on its borrowings. At September

30, 2002, the Company had $18.9 million in floating-rate debt. An adverse

change in interest rates during any period that the loan is outstanding would

cause an increase in interest expense. A 100 basis point increase in the bank&#146;s

base rate would increase the annual amount of interest paid by $0.2 million.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company issued warrants on January 31, 2002, which

are classified as derivative financial instruments pursuant to SFAS 133, which

was adopted by the Company on January 1, 2001.&#160;

Pursuant to SFAS 133 and interpretations by the Emerging Issues Task

Force covering derivative financial instruments, these warrants meet the

criteria for equity classification on the measurement date of January 31, 2002

and the Company is not required to remeasure the warrants on subsequent

dates.&#160; As such, there is no

mark-to-market adjustment which will be reflected in the statement of

operations as unrealized gains or losses as a result of changes in fair value

of these warrants in periods subsequent to the measurement date.&#160; Additionally, there is no equity price risk

associated with changes in fair value of the warrants.&#160; The Company does not have any derivative

financial instruments other than the warrants.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt;"><a name="Item4"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Item 4</font></b></a><b><font style="font-weight:bold;">. &#150; <a name="Control">Control</a>s and Procedures</font></b></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Our Chief Executive Officer and Chief Financial

Officer have concluded, based on their evaluation within 90 days of the filing

date of this report, that our disclosure controls and procedures are effective

for gathering, analyzing and disclosing the information we are required to

disclose in our reports filed under the Securities Exchange Act of 1934.&#160; There have been no significant changes in

our internal controls or in other factors that could significantly affect these

controls subsequent to the date of the previously mentioned evaluation.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">FORWARD-LOOKING

STATEMENTS</font></b></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company makes forward-looking statements from time to time and

desires to take advantage of the &#147;safe harbor,&#148; which is afforded such

statements under the Private Securities Litigation Reform Act of 1995, when

they are accompanied by meaningful cautionary statements identifying important

factors that could cause actual results to differ materially from those in the

forward-looking statements. The statements contained in this Form 10-Q,

including those under &#147;Management&#146;s Discussion and Analysis of Financial

Condition and Results of Operations,&#148; statements contained in future filings

with the Securities and Exchange Commission and publicly disseminated press

releases, and statements which may be made from time-to-time in the future by

management of the Company in presentations to shareholders, prospective

investors, and others interested in the business and financial affairs of the

Company, which are not historical facts, are forward-looking statements that

involve risks and uncertainties that could cause actual results to differ

materially from those set forth in the forward-looking statements. Any

projections of financial performance or statements concerning expectations as

to future developments should not be construed in any manner as a guarantee

that such results or developments will, in fact, occur. There can be no

assurance any forward-looking statement will be realized or that actual results

will not be significantly different from that set forth in such forward-looking

statement.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In addition to the risks and uncertainties of ordinary business

operations, the forward-looking statements of the Company referred to above are

also subject to the following risks and uncertainties:</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Company&#146;s ability

to attract and retain qualified information technology professionals;</p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Company&#146;s

ability to recruit, train, integrate and retain qualified sales directors,

account managers, and recruiters;</p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Competition in

the information technology services marketplace;</p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Company&#146;s

continued ability to initiate and develop client relationships;</p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Company&#146;s

ability to identify and respond to trends in information technology;</p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Unforeseen

business trends in the Company&#146;s national accounts or other large clients;</p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Pricing

pressures and/or wage inflation and the resulting impact on gross profit and

net operating margins;</p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The ability to

successfully enter new geographic markets; and</p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The effect of

changes in general economic conditions.</p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15</font></p>





<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p style="margin:0in 0in .0001pt;"><a name="PartIi"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">PART II</font></b></a><b><font size="2" style="font-size:10.0pt;font-weight:bold;"> &#150; <a name="Other">OTHER</a> INFORMATION</font></b></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<h3 align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;page-break-after:auto;text-align:left;"><a name="Item6"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Item 6</font></b></a>.

&#150; <a name="Exh">Exh</a>ibits and Reports on Form 8-K</h3>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 1.0in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The

following documents are furnished as an exhibit and numbered pursuant to Item

601 of Regulation S-K:</p>



<p style="margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<table border="0" cellspacing="0" cellpadding="0" width="80%" style="border-collapse:collapse;margin-left:1.0in;width:80.0%;">

 <tr>

  <td width="17%" valign="top" style="padding:0in 0in 0in 0in;width:17.92%;">

  <p align="left" style="margin:0in 0in .0001pt;page-break-after:auto;text-align:left;text-decoration:underline;text-indent:0in;"><u><font size="2" face="Times New Roman" style="font-size:10.0pt;">Exhibit

  Number</font></u></p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.6%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="79%" valign="top" style="padding:0in 0in 0in 0in;width:79.48%;">

  <p align="left" style="margin:0in 0in .0001pt;page-break-after:auto;text-align:left;text-decoration:underline;text-indent:0in;"><u><font size="2" face="Times New Roman" style="font-size:10.0pt;">Description</font></u></p>

  </td>

 </tr>

 <tr>

  <td width="17%" valign="top" style="padding:0in 0in 0in 0in;width:17.92%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.6%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="79%" valign="top" style="padding:0in 0in 0in 0in;width:79.48%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="17%" valign="top" style="padding:0in 0in 0in 0in;width:17.92%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.1</font></p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.6%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="79%" valign="top" style="padding:0in 0in 0in 0in;width:79.48%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Second Amendment to Credit Agreement.</font></p>

  </td>

 </tr>

 <tr>

  <td width="17%" valign="top" style="padding:0in 0in 0in 0in;width:17.92%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.6%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="79%" valign="top" style="padding:0in 0in 0in 0in;width:79.48%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="17%" valign="top" style="padding:0in 0in 0in 0in;width:17.92%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.2</font></p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.6%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="79%" valign="top" style="padding:0in 0in 0in 0in;width:79.48%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Third Amendment to Credit Agreement</font></p>

  </td>

 </tr>

 <tr>

  <td width="17%" valign="top" style="padding:0in 0in 0in 0in;width:17.92%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.6%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="79%" valign="top" style="padding:0in 0in 0in 0in;width:79.48%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="17%" valign="top" style="padding:0in 0in 0in 0in;width:17.92%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.1</font></p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.6%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="79%" valign="top" style="padding:0in 0in 0in 0in;width:79.48%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Executive Employment Agreement between Alternative

  Resources Corporation and Bill McLendon dated September 16, 2002.</font></p>

  </td>

 </tr>

 <tr>

  <td width="17%" valign="top" style="padding:0in 0in 0in 0in;width:17.92%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.6%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="79%" valign="top" style="padding:0in 0in 0in 0in;width:79.48%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="17%" valign="top" style="padding:0in 0in 0in 0in;width:17.92%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.2</font></p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.6%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="79%" valign="top" style="padding:0in 0in 0in 0in;width:79.48%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Executive Separation Agreement between Alternative

  Resources Corporation and Miner Smith dated August 2, 2002.</font></p>

  </td>

 </tr>

 <tr>

  <td width="17%" valign="top" style="padding:0in 0in 0in 0in;width:17.92%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.6%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="79%" valign="top" style="padding:0in 0in 0in 0in;width:79.48%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="17%" valign="top" style="padding:0in 0in 0in 0in;width:17.92%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">99.1</font></p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.6%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="79%" valign="top" style="padding:0in 0in 0in 0in;width:79.48%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Certification Pursuant to 18 U.S.C. Section 1350, as

  Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.</font></p>

  </td>

 </tr>

</table>



<p style="margin:0in 0in .0001pt 2.25in;text-indent:-63.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 1.0in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Form

8-K was filed on July 2, 2002, reporting under Item 5. &#147;Other Events&#148;, the

departure of Ray R. Hipp as Chairman and Chief Executive Officer and the

appointment of George W. Watts as President and Chief Executive Officer.</p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">16</font></p>





<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;"><a name="Sign"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SIGN</font></b></a><b><font style="font-weight:bold;">ATURES</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Pursuant to the requirements of the Securities

Exchange Act of 1934, the registrant has duly caused this report to be signed

on its behalf by the undersigned thereunto duly authorized.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">

 <tr>

  <td width="57%" valign="top" style="padding:0in .7pt 0in .7pt;width:57.94%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="42%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:42.06%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ALTERNATIVE RESOURCES CORPORATION</font></p>

  </td>

 </tr>

 <tr>

  <td width="57%" valign="top" style="padding:0in .7pt 0in .7pt;width:57.94%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="42%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:42.06%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="57%" valign="top" style="padding:0in .7pt 0in .7pt;width:57.94%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="42%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:42.06%;">

  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="57%" valign="top" style="padding:0in .7pt 0in .7pt;width:57.94%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Date:&#160;

  November 14, 2002</font></p>

  </td>

  <td width="26%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:26.8%;">

  <p style="margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/ Steven

  Purcell</font></p>

  </td>

  <td width="15%" valign="top" style="padding:0in .7pt 0in .7pt;width:15.26%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="57%" valign="top" style="padding:0in .7pt 0in .7pt;width:57.94%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="42%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:42.06%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Steven Purcell</font></p>

  </td>

 </tr>

 <tr>

  <td width="57%" valign="top" style="padding:0in .7pt 0in .7pt;width:57.94%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="42%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:42.06%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Senior Vice President, Chief Financial Officer,<br>

  Treasurer and Secretary</font></p>

  </td>

 </tr>

</table>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17</font></p>





<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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</font>



<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><a name="Certifications"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">CERTIFICATIONS</font></b></a></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">I, George W. Watts,

certify that:</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 58.3pt;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I have reviewed

this quarterly report on Form 10-Q of Alternative Resources Corporation;</p>



<p style="margin:0in 0in .0001pt 40.3pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 58.3pt;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Based on my

knowledge, this quarterly report does not contain any untrue statement of a

material fact or omit to state a material fact necessary to make the statements

made, in light of circumstances under which such statements were made, not

misleading with respect to the period covered by this quarterly report;</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 58.3pt;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Based on my

knowledge, the financial statements, and other financial information included

in this quarterly report, fairly present in all material respects the financial

condition, results of operations and cash flows of the registrant as of, and

for, the periods presented in this quarterly report;</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 58.3pt;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The registrant&#146;s

other certifying officers and I are responsible for establishing and maintaining

disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and

15d-14) for the registrant and we have:</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a) designed such disclosure controls and procedures

to ensure that material information relating to the registrant, including its

consolidated subsidiaries, is made known to us by others within those entities,

particularly during the period in which this quarterly report is being

prepared;</font></p>



<p style="margin:0in 0in .0001pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b) evaluated the effectiveness of the registrant&#146;s

disclosure controls and procedures as of a date within 90 days prior to filing

date of this quarterly report (the &#147;Evaluation Date&#148;); and</font></p>



<p style="margin:0in 0in .0001pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c) presented in this quarterly report our conclusions

about the effectiveness of the disclosure controls and procedures based on our

evaluation as of the Evaluation Date;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 58.5pt;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The registrant&#146;s

other certifying officers and I have disclosed, based on our most recent

evaluation, to the registrant&#146;s auditors and the audit committee of

registrant&#146;s board of directors (or persons performing the equivalent function):</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a) all significant deficiencies in the design or

operation of internal controls which could adversely affect the registrant&#146;s

ability to record, process, summarize and report financial data and have

identified for the registrant&#146;s auditors any material weaknesses in internal

controls; and</font></p>



<p style="margin:0in 0in .0001pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b) any fraud, whether or not material, that involves

management or other employees who have a significant role in the registrant&#146;s

internal controls; and</font></p>



<p style="margin:0in 0in .0001pt 40.5pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 58.5pt;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The registrant&#146;s

other certifying officers and I have indicated in this quarterly report whether

or not there were significant changes in internal controls or in other factors

that could significantly affect internal controls subsequent to the date of our

most recent evaluation, including any corrective actions with regard to

significant deficiencies and material weaknesses.</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">

 <tr>

  <td width="57%" valign="top" style="padding:0in .7pt 0in .7pt;width:57.64%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Date:&#160;

  November 14, 2002</font></p>

  </td>

  <td width="23%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:23.94%;">

  <p style="margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/ George W.

  Watts</font></p>

  </td>

  <td width="18%" valign="top" style="padding:0in .7pt 0in .7pt;width:18.42%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="57%" valign="top" style="padding:0in .7pt 0in .7pt;width:57.64%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="42%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:42.36%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">George W. Watts</font></p>

  </td>

 </tr>

 <tr>

  <td width="57%" valign="top" style="padding:0in .7pt 0in .7pt;width:57.64%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="42%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:42.36%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Chief Executive Officer</font></p>

  </td>

 </tr>

</table>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">18</font></p>





<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='18',FILE='C:\C2\lnelson\5154_3\t_947606\j5154_10q.htm',USER='lnelsona',CD='Nov 14 13:06 2002' -->
<br clear="all" style="page-break-before:always;">

</font>



<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">CERTIFICATIONS</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">I, Steven Purcell,

certify that:</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 58.3pt;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I have reviewed

this quarterly report on Form 10-Q of Alternative Resources Corporation;</p>



<p style="margin:0in 0in .0001pt 40.3pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 58.3pt;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Based on my

knowledge, this quarterly report does not contain any untrue statement of a

material fact or omit to state a material fact necessary to make the statements

made, in light of circumstances under which such statements were made, not

misleading with respect to the period covered by this quarterly report;</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 58.3pt;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Based on my

knowledge, the financial statements, and other financial information included in

this quarterly report, fairly present in all material respects the financial

condition, results of operations and cash flows of the registrant as of, and

for, the periods presented in this quarterly report;</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 58.3pt;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The registrant&#146;s other

certifying officers and I are responsible for establishing and maintaining

disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and

15d-14) for the registrant and we have:</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a) designed such disclosure controls and procedures

to ensure that material information relating to the registrant, including its

consolidated subsidiaries, is made known to us by others within those entities,

particularly during the period in which this quarterly report is being

prepared;</font></p>



<p style="margin:0in 0in .0001pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b) evaluated the effectiveness of the registrant&#146;s

disclosure controls and procedures as of a date within 90 days prior to filing

date of this quarterly report (the &#147;Evaluation Date&#148;); and</font></p>



<p style="margin:0in 0in .0001pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c) presented in this quarterly report our conclusions

about the effectiveness of the disclosure controls and procedures based on our

evaluation as of the Evaluation Date;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 58.5pt;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The registrant&#146;s other

certifying officers and I have disclosed, based on our most recent evaluation,

to the registrant&#146;s auditors and the audit committee of registrant&#146;s board of

directors (or persons performing the equivalent function):</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a) all significant deficiencies in the design or

operation of internal controls which could adversely affect the registrant&#146;s

ability to record, process, summarize and report financial data and have identified

for the registrant&#146;s auditors any material weaknesses in internal controls; and</font></p>



<p style="margin:0in 0in .0001pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b) any fraud, whether or not material, that involves

management or other employees who have a significant role in the registrant&#146;s

internal controls; and</font></p>



<p style="margin:0in 0in .0001pt 40.5pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:10.0pt;margin:0in 0in .0001pt 58.5pt;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">12.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The registrant&#146;s other

certifying officers and I have indicated in this quarterly report whether or

not there were significant changes in internal controls or in other factors

that could significantly affect internal controls subsequent to the date of our

most recent evaluation, including any corrective actions with regard to

significant deficiencies and material weaknesses.</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">

 <tr>

  <td width="58%" valign="top" style="padding:0in .7pt 0in .7pt;width:58.3%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Date:&#160;

  November 14, 2002</font></p>

  </td>

  <td width="23%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:23.3%;">

  <p style="margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/ Steven

  Purcell</font></p>

  </td>

  <td width="18%" valign="top" style="padding:0in .7pt 0in .7pt;width:18.42%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="58%" valign="top" style="padding:0in .7pt 0in .7pt;width:58.3%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="41%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:41.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Steven Purcell</font></p>

  </td>

 </tr>

 <tr>

  <td width="58%" valign="top" style="padding:0in .7pt 0in .7pt;width:58.3%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="41%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:41.7%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Chief Executive Officer</font></p>

  </td>

 </tr>

</table>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">19</font></p>





<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



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<DESCRIPTION>EX-4.1
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<head>



<title>  </title>



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<div>



<p align="right" style="margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Exhibit 4.1</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECOND AMENDMENT TO CREDIT AGREEMENT</font></b></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This SECOND AMENDMENT TO CREDIT AGREEMENT is dated as

of August 30, 2002 (this &#147;<u>Amendment</u>&#148;), among Alternative Resources

Corporation (&#147;<u>ARC</u>&#148;), ARC Service, Inc., ARC Solutions, Inc., ARC

Midholding, Inc., and Writers Inc. (collectively, the &#147;<u>Borrowers</u>&#148;), and

Fleet Capital Corporation (the &#147;<u>Lender</u>&#148;).</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">WHEREAS, the Borrowers and the Lender are parties to a

Credit and Security Agreement dated as of January 31, 2002, as amended by the

certain First Amendment to Credit Agreement and Waiver dated as of August 8,

2002 (as so amended, the &#147;<u>Credit Agreement</u>&#148;); and</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">WHEREAS, the Borrowers and the Lender desire to amend

and restate Section 8.10(c) of the Credit Agreement;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">NOW, THEREFORE, in consideration of the foregoing and

the agreements contained herein, the parties hereby agree as follows:</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Capitalized Terms</u>.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Capitalized terms used herein which are defined in the

Credit Agreement have the same meanings herein as therein, except to the extent

that such meanings are amended hereby.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Amendment of Section 8.10(c) of the Credit Agreement</u>.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Borrowers and the Lender hereby agree that Section

8.10(c) of the Credit Agreement shall be amended and restated in its entirety

to read as follows:</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in .5in .0001pt 1.0in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Fixed Charge Coverage Shortfall</u>.&#160; The amount by which (a) the aggregate Fixed

Charges of ARC and its Subsidiaries for each fiscal period set forth below,

exceeds (b) the total of (i) EBITDA of ARC and its Subsidiaries for such period

(determined on a consolidated basis without duplication in accordance with

GAAP) <u>minus</u> (ii) the aggregate amount of all Non-Financed Capital

Expenditures during such period <u>minus</u> (iii) the aggregate amount paid,

or required to be paid (without duplication), in cash in respect of the current

portion of all income taxes for such period <u>minus</u> (iv) the aggregate

amount of dividends and distributions permitted to be paid under Section 8.6

and actually paid in cash during such period, shall not be greater than the

maximum shortfall amount set opposite such fiscal period:</font></p>



<p style="margin:0in .5in .0001pt 1.0in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<div align="center" style="font-family:'Times New Roman';">



<table border="0" cellspacing="0" cellpadding="0" width="60%" style="border-collapse:collapse;width:60.0%;">

 <tr>

  <td width="71%" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:71.34%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Fiscal

  Period</font></b></p>

  </td>

  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.72%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="22%" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:22.28%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Maximum Shortfall<br>

  Amount</font></b></p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:2.64%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="71%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:71.34%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">July 1 through July 31,

  2002</font></p>

  </td>

  <td width="3%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in .7pt 0in .7pt;width:3.72%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="22%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:22.28%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$250,000</font></p>

  </td>

  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in .7pt 0in .7pt;width:2.64%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="71%" valign="top" style="padding:0in .7pt 0in .7pt;width:71.34%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">July 1 through August

  31, 2002</font></p>

  </td>

  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.72%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="22%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:22.28%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$150,000</font></p>

  </td>

  <td width="2%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:2.64%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

 <tr>

  <td width="71%" valign="top" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in .7pt 0in .7pt;width:71.34%;">

  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">July 1 through

  September 30, 2002</font></p>

  </td>

  <td width="3%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in .7pt 0in .7pt;width:3.72%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="22%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in .7pt 0in .7pt;width:22.28%;">

  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$250,000&#148;</font></p>

  </td>

  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in .7pt 0in .7pt;width:2.64%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>

  </td>

 </tr>

</table>



</div>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>





<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="3" style="font-size:12.0pt;">
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</font>



<p align="center" style="font-family:'Times New Roman';font-size:12.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Amendment of Exhibit D to the

Credit Agreement.</font></p>



<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Borrowers and the Lender hereby agree that Exhibit

D to the Credit Agreement shall be replaced with the new form of Exhibit D

attached thereto.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>No Default; Representations and Warranties, etc</u>.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Borrowers hereby represent, warrant and confirm

that: (a) the representations and warranties of the Credit Parties contained in

Article 5 of the Credit Agreement are true and correct on and as of the date

hereof as if made on such date (except to the extent that such representations

and warranties expressly relate to an earlier date); (b) after giving effect to

this Amendment, the Borrowers are in compliance with all of the terms and

provisions set forth in the Credit Agreement and the other Loan Documents; (c)

after giving effect to this Amendment, no Default has occurred and is

continuing; and (d)&nbsp;the execution, delivery and performance by the

Borrowers of this Amendment (i) have been duly authorized by all necessary

action on the part of the Borrowers, (ii) will not violate any applicable law

or regulation or the organizational documents of any Borrower, (iii) will not

violate or result in a default under any indenture, agreement or other

instrument binding on any Borrower or any of its assets, including without

limitation, any Subordinated Debt Document, and (iv) do not require any

consent, waiver or approval of or by any Person (other than the Lender) which

has not been obtained.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Miscellaneous</u>.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Except

as specifically amended hereby, all of the terms and provisions of the Credit

Agreement, the other Loan Documents and all related documents, shall remain in

full force and effect.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; This

Amendment may be executed in any number of counterparts, each of which, when

executed and delivered, shall be an original, but all counterparts shall

together constitute one instrument.&#160;

Delivery of an executed signature page hereto by facsimile transmission

shall be effective as delivery of a manually executed counterpart hereof.</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; This

Amendment shall be governed by the laws of The Commonwealth of Massachusetts and

shall be binding upon and inure to the benefit of the parties hereto and their

respective successors and assigns.</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">[Remainder of Page Left Intentionally Blank]</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2</font></p>





<div align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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</font>



<p align="center" style="font-family:'Times New Roman';font-size:12.0pt;margin:0in 0in .0001pt;text-align:center;text-indent:0in;">&nbsp;</p>



<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be

duly executed by their respective authorized officers as of the day and year

first above written.</font></p>



<p style="margin:0in 0in .0001pt 3.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;font-family:'Times New Roman';width:100.0%;">

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;"><u><font size="2" face="Times New Roman" style="font-size:10.0pt;">BORROWERS</font></u></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ALTERNATIVE

  RESOURCES CORPORATION</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="3%" valign="top" style="padding:0in .7pt 0in .7pt;width:3.0%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>

  </td>

  <td width="42%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:42.6%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ARC SERVICE,

  INC.</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="3%" valign="top" style="padding:0in .7pt 0in .7pt;width:3.0%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By</font></p>

  </td>

  <td width="42%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:42.6%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ARC SOLUTIONS,

  INC.</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="3%" valign="top" style="padding:0in .7pt 0in .7pt;width:3.0%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By</font></p>

  </td>

  <td width="42%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:42.6%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

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  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>

  </td>

 </tr>

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  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ARC MIDHOLDING,

  INC.</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

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  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="3%" valign="top" style="padding:0in .7pt 0in .7pt;width:3.0%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By</font></p>

  </td>

  <td width="42%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:42.6%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">WRITERS INC.</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="3%" valign="top" style="padding:0in .7pt 0in .7pt;width:3.0%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By</font></p>

  </td>

  <td width="42%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:42.6%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>

  </td>

 </tr>

</table>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3</font></p>





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<p align="center" style="font-family:'Times New Roman';font-size:12.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;font-family:'Times New Roman';width:100.0%;">

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  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

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  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

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  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><u><font size="2" face="Times New Roman" style="font-size:10.0pt;">LENDER</font></u></p>

  </td>

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  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">FLEET CAPITAL

  CORPORATION, as Lender</font></p>

  </td>

 </tr>

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  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="3%" valign="top" style="padding:0in .7pt 0in .7pt;width:3.0%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By</font></p>

  </td>

  <td width="42%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:42.6%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

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  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><u><font size="2" face="Times New Roman" style="font-size:10.0pt;">ISSUING LENDER</font></u></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">FLEET NATIONAL

  BANK, as Issuing Lender</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="3%" valign="top" style="padding:0in .7pt 0in .7pt;width:3.0%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By</font></p>

  </td>

  <td width="42%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:42.6%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><u><font size="2" face="Times New Roman" style="font-size:10.0pt;">CASH MANAGEMENT

  BANK</font></u></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">FLEET NATIONAL

  BANK, as Cash Management Bank</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="3%" valign="top" style="padding:0in .7pt 0in .7pt;width:3.0%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By</font></p>

  </td>

  <td width="42%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:42.6%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>

  </td>

 </tr>

 <tr>

  <td width="54%" valign="top" style="padding:0in .7pt 0in .7pt;width:54.4%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="45%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:45.6%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>

  </td>

 </tr>

</table>



<p align="center" style="margin:0in 0in .0001pt;page-break-after:avoid;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;page-break-after:avoid;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4</font></p>





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<p align="center" style="margin:0in 0in 12.0pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">THIRD

AMENDMENT TO CREDIT AGREEMENT AND WAIVER</font></b></p>



<p style="margin:0in 0in 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This THIRD AMENDMENT TO

CREDIT AGREEMENT AND WAIVER dated as of November 14, 2002 (this &#147;<u>Amendment</u>&#148;),

among Alternative Resources Corporation (&#147;<u>ARC</u>&#148;), ARC Service, Inc., ARC

Solutions, Inc., ARC Midholding, Inc., and Writers Inc. (collectively, the &#147;<u>Borrowers</u>&#148;),

and Fleet Capital Corporation (the &#147;<u>Lender</u>&#148;), amends the Credit and

Security Agreement dated as of January 31, 2002 (the &#147;<u>Credit Agreement</u>&#148;),

between the Borrowers and the Lender.</font></p>



<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">WHEREAS, ARC and its Subsidiaries

failed to have the minimum Tangible Capital Base required by Section 8.10(a) of

the Credit Agreement for the fiscal quarter ended September 30, 2002 and such

failure constitutes an Event of Default under Section 9.1(c) of the Credit

Agreement (the &#147;<u>September 30, 2002 Event of Default</u>&#148;);</font></p>



<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">WHEREAS, the Credit

Parties have requested that the Lender waive the September 30, 2002 Event of

Default as provided herein, and amend certain provisions of the Credit

Agreement; and</font></p>



<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">WHEREAS, the Lender has

agreed to waive the September 30, 2002 Event of Default and to amend certain

provisions of the Credit Agreement, all subject to the terms, conditions and

limitations set forth herein;</font></p>



<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">NOW, THEREFORE, in

consideration of the foregoing and the agreements contained herein, the parties

hereby agree as follows:</font></p>



<p style="margin:0in 0in 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Capitalized

Terms</u>.</font></p>



<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Capitalized terms used

herein which are defined in the Credit Agreement have the same meanings herein

as therein, except to the extent that such meanings are amended hereby.</font></p>



<p style="margin:0in 0in 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Waiver

of September 30, 2002 Event of Default.</u></font></p>



<p align="left" style="margin:0in 0in 12.0pt;text-align:left;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Subject to the satisfaction of

the terms and conditions set forth in Section 5 hereof, the Lender hereby

waives the September 30, 2002 Event of Default.&#160; The parties agree that the foregoing waiver is limited solely to

the Event of Default arising out of the failure of ARC and its Subsidiaries to

satisfy the minimum Tangible Capital Base covenant set forth in Section 8.10(a)

of the Credit Agreement for the fiscal quarter ended September 30, 2002, and

nothing herein shall be construed as a waiver of any other presently existing

or future Event of Default (including without limitation, any Event of Default

caused by reason of the failure of the Borrowers to comply with Section 8.10(a)

of the Credit Agreement, as amended hereby, on any other occasion or for any

other period) or any failure of the Borrowers to comply with any other

provision, term or condition of the Loan Documents.</font></p>



<p style="margin:0in 0in 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Amendments</u>.</font></p>



<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Subject to the

satisfaction of the terms and conditions set forth in Section 5 hereof, the

Borrowers and the Lender agree that the Credit Agreement is hereby amended,

effective as of the date hereof, as follows:</font></p>



<p style="margin:0in 0in 12.0pt;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font></i><font size="2" style="font-size:10.0pt;">(a)<i><font style="font-style:italic;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Amendments

to Section 1.1 of the Credit Agreement.&#160;

</font></i>Section 1.1 of the Credit Agreement is hereby amended as

follows:</font></p>



<p style="margin:0in 0in 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; (i)&#160; The definition of the term <i><font style="font-style:italic;">&#147;Fixed

Charges&#148;</font></i> set forth in Section 1.1 of the Credit Agreement is hereby

amended and restated in its entirety to read as follows:</font></p>



<p align="center" style="margin:0in 0in 12.0pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>





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<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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<p align="center" style="font-size:12.0pt;margin:0in 0in 12.0pt;text-align:center;text-indent:0in;">&nbsp;</p>



<p align="left" style="margin:0in .5in 12.0pt 1.0in;text-align:left;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;&#145;<u>Fixed Charges</u>&#146;

means, for any period, the sum for the Borrowers and all Subsidiaries

(determined on a consolidated basis without duplication in accordance with

GAAP), of (a) the aggregate amount of Interest Expense for such period

(excluding, for the purpose of computing Fixed Charges, that certain amendment

fee required to be paid by the Borrowers to the Lender in connection with that

certain First Amendment to Credit Agreement and Waiver dated as of August 8,

2002 among the Borrowers and the Lender and that certain amendment fee required

to be paid by the Borrowers to the Lender in connection with that certain Third

Amendment to Credit Agreement and Waiver dated as of November 14, 2002 among

the Borrowers and the Lender) <u>plus</u> (b) the aggregate amount of regularly

scheduled payments of principal in respect of Indebtedness for borrowed money

(including the principal component of any payments in respect of Capital Lease

Obligations) paid or required to be paid during such period, <u>plus</u> (c)

the aggregate amount of cash disbursements made by the Borrowers after June 30,

2002, pursuant to that certain severance agreement between ARC and its former

Chief Executive Officer, <u>plus</u> (d) the aggregate amount of cash

disbursements made by the Borrowers to reduce the accrued restructuring

liability created as of September 30, 2002 in connection with the relocation of

the Borrowers&#146; Client Services Management.&#148;</font></p>



<p style="margin:0in 0in 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; (ii) The definition of the term <i><font style="font-style:italic;">&#147;Tangible

Net Worth&#148;</font></i> set forth in Section 1.1 of the Credit Agreement is

hereby amended and restated in its entirety to read as follows:</font></p>



<p style="margin:0in .5in 12.0pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;&#145;<u>Tangible Net Worth</u>&#146; means, at any time an

amount (determined on a consolidated basis without duplication in accordance

with GAAP) equal to (a) the book net worth of the Borrowers and all

Subsidiaries on a consolidated basis, <u>minus</u> (b) the total book value of

all assets of the Borrowers and all Subsidiaries on a consolidated basis which

would be treated as intangible assets under GAAP, including without limitation,

such items as goodwill, customer lists, Patents, Copyrights and Trademarks, and

rights (including rights under licenses) with respect to the foregoing, <u>minus</u>

(c) the aggregate amount of liabilities which are or would be accounted for as

&#147;Loan Origination Fees&#148; on the Borrower&#146;s balance sheet based on the

application of GAAP used in connection with the preparation of the Borrower&#146;s

balance sheet dated September 30, 2002 (notwithstanding any term contained in

this Agreement to the contrary, including without limitation Section 1.3).</font></p>



<p align="left" style="margin:0in 0in 12.0pt;text-align:left;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; (b)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <i><font style="font-style:italic;">Amendment to Section 8.10(a) of the Credit Agreement</font></i>.&#160; Section 8.10(a) of the Credit Agreement is

hereby amended and restated in its entirety to read as follows:</font></p>



<p style="margin:0in .5in 12.0pt 1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; (a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Tangible Capital Base</u>.&#160; ARC and its Subsidiaries shall not (i) as of

September 30, 2002, have a consolidated Tangible Capital Base of less than

$2,750,000 or (ii)&nbsp;as of the end of any fiscal quarter commencing with the

fiscal quarter ending December 31, 2002, have a consolidated Tangible Capital

Base of less than the sum of (x) $2,750,000 <u>plus</u> (y) on a cumulative

basis, 50% of positive consolidated net income (without reduction for losses)

for each fiscal quarter ending after September 30, 2002.</font></p>



<p align="left" style="margin:0in 0in 12.0pt;text-align:left;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; (c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <i><font style="font-style:italic;">Amendment of Exhibit D to the Credit Agreement</font></i>.&#160; Exhibit D to the Credit Agreement is hereby

replaced with the new form of Exhibit D attached thereto.</font></p>



<p align="center" style="margin:0in 0in 12.0pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2</font></p>





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<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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<p align="center" style="font-size:12.0pt;margin:0in 0in 12.0pt;text-align:center;text-indent:0in;">&nbsp;</p>



<p style="margin:0in 0in 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>No

Default; Representations and Warranties, etc</u>.</font></p>



<p style="margin:0in 0in 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; The

Borrowers hereby represent, warrant and confirm that: (a) the representations

and warranties of the Credit Parties contained in Article 5 of the Credit

Agreement are true and correct on and as of the date hereof as if made on such

date (except to the extent that such representations and warranties expressly

relate to an earlier date); (b) after giving effect to this Amendment, the

Borrowers are in compliance with all of the terms and provisions set forth in

the Credit Agreement and the other Loan Documents; (c) after giving effect to

this Amendment, no Default has occurred and is continuing; and (d)&nbsp;the

execution, delivery and performance by the Borrowers of this Amendment (i) have

been duly authorized by all necessary action on the part of the Borrowers, (ii)

will not violate any applicable law or regulation or the organizational

documents of any Borrower, (iii) will not violate or result in a default under

any indenture, agreement or other instrument binding on any Borrower or any of

its assets, including without limitation, any Subordinated Debt Document, and

(iv) do not require any consent, waiver or approval of or by any Person (other

than the Lender) which has not been obtained.</font></p>



<p style="margin:0in 0in 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Conditions

to Effectiveness</u>.</font></p>



<p style="margin:0in 0in 6.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; The

effectiveness of this Amendment shall be subject to the satisfaction of the

following conditions precedent:</font></p>



<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Lender shall have received

counterparts of this Amendment duly executed by each of the Borrowers;</font></p>



<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Lender shall have received a

Certificate of the Secretary of ARC, certifying that this Amendment has been

duly authorized by the Boards of Directors of ARC and each of its Subsidiaries;</font></p>



<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Borrowers shall have delivered to

the Lender evidence that Wynnchurch has executed and delivered to the Borrowers

a written amendment and waiver with respect to the Subordinated Debt Documents

in form and substance reasonably acceptable to the Lender, pursuant to which

Wynnchurch shall have waived all existing defaults of the Borrowers under the

Subordinated Debt Documents and amended the financial covenant provisions of

the Subordinated Debt Documents in a manner consistent with the financial

covenant amendments set forth in this Amendment;</font></p>



<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Lender shall have received a

written acknowledgement from Wynnchurch with respect to the existence of the

September 30, 2002 Event of Default and the modifications to the Credit

Agreement contemplated by this Amendment;</font></p>



<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Borrowers shall have reimbursed

the Lender for all reasonable costs and expenses, including reasonable legal

fees and disbursements, incurred by the Lender in connection with this

Amendment and the transactions contemplated hereby; and</font></p>



<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(f)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Lender shall have received from

the Borrowers, an amendment fee in an amount equal to $10,000.</font></p>



<p style="margin:0in 0in 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Miscellaneous</u>.</font></p>



<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Except as specifically amended

hereby, all of the terms and provisions of the Credit Agreement, the other Loan

Documents and all related documents, shall remain in full force and

effect.&#160; Nothing contained herein shall

constitute a waiver of any provision of the Credit Agreement or the Other Loan

Documents, except for the waiver of the September 30, 2002 Event of Default

expressly set forth herein.</font></p>



<p align="center" style="margin:0in 0in 12.0pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3</font></p>





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<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



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<p align="center" style="font-size:12.0pt;margin:0in 0in 12.0pt;text-align:center;text-indent:0in;">&nbsp;</p>



<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; This Amendment may be executed in any

number of counterparts, each of which, when executed and delivered, shall be an

original, but all counterparts shall together constitute one instrument.&#160; Delivery of an executed signature page

hereto by facsimile transmission shall be effective as delivery of a manually

executed counterpart hereof.</font></p>



<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; This Amendment shall be governed by

the laws of The Commonwealth of Massachusetts and shall be binding upon and

inure to the benefit of the parties hereto and their respective successors and

assigns.</font></p>



<p align="center" style="margin:0in 0in 12.0pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4</font></p>





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<p align="left" style="margin:0in 0in 12.0pt;text-align:left;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">IN WITNESS WHEREOF, the

parties hereto have caused this Amendment to be duly executed by their

respective authorized officers as of the day and year first above written.</font></p>



<p style="margin:0in 0in .0001pt 3.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<table border="0" cellspacing="0" cellpadding="0" width="51%" style="border-collapse:collapse;margin-left:196.45pt;width:51.3%;">

 <tr>

  <td width="28%" colspan="2" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:28.92%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">BORROWERS</font></p>

  </td>

  <td width="43%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:43.44%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="27%" colspan="3" valign="top" style="padding:0in .7pt 0in .7pt;width:27.64%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="94%" colspan="4" valign="bottom" style="padding:0in .7pt 0in .7pt;width:94.52%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="5%" valign="top" style="padding:0in .7pt 0in .7pt;width:5.0%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="0%" style="border:none;font-size:12.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ALTERNATIVE

  RESOURCES CORPORATION<br><br></font></p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="8%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:8.36%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>

  </td>

  <td width="91%" colspan="4" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:91.18%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="0%" style="border:none;font-size:12.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ARC SERVICE,

  INC.<br><br></font></p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="8%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:8.36%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By</font></p>

  </td>

  <td width="91%" colspan="4" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:91.18%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font><font size="2" style="font-size:10.0pt;">  <br>

  Title:</font></p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="0%" style="border:none;font-size:12.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ARC SOLUTIONS,

  INC.<br><br></font></p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="8%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:8.36%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By</font></p>

  </td>

  <td width="91%" colspan="4" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:91.18%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="0%" style="border:none;font-size:12.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ARC MIDHOLDING,

  INC.<br><br></font></p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="8%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:8.36%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By</font></p>

  </td>

  <td width="91%" colspan="4" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:91.18%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="0%" style="border:none;font-size:12.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">WRITERS INC.<br><br></font></p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="8%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:8.36%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By</font></p>

  </td>

  <td width="91%" colspan="4" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:91.18%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>

  </td>

  <td width="0%" style="border:none;font-size:1.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr>

  <td width="99%" colspan="5" valign="bottom" style="padding:0in .7pt 0in .7pt;width:99.54%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="0%" style="border:none;font-size:12.0pt;padding:0in 0in 0in 0in;"><p style="margin:0in 0in 12.0pt;">&nbsp;</p></td>

 </tr>

 <tr height="0">

  <td width="26" style="border:none;"></td>

  <td width="64" style="border:none;"></td>

  <td width="136" style="border:none;"></td>

  <td width="69" style="border:none;"></td>

  <td width="16" style="border:none;"></td>

  <td width="1" style="border:none;"></td>

 </tr>

</table>



<p align="center" style="margin:0in 0in .25in;page-break-after:avoid;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5</font></p>





<div style="margin:0in 0in .25in;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;"><u>
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<p style="margin:0in 0in 12.0pt 2.5in;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<table border="0" cellspacing="0" cellpadding="0" width="51%" style="border-collapse:collapse;margin-left:197.05pt;width:51.12%;">

 <tr>

  <td width="20%" colspan="2" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:20.04%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">LENDER</font></p>

  </td>

  <td width="65%" colspan="6" valign="top" style="padding:0in .7pt 0in .7pt;width:65.74%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.22%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="100%" colspan="9" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="100%" colspan="9" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">FLEET CAPITAL

  CORPORATION, as Lender<br><br></font></p>

  </td>

 </tr>

 <tr>

  <td width="8%" valign="top" style="padding:0in .7pt 0in .7pt;width:8.04%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By</font></p>

  </td>

  <td width="91%" colspan="8" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:91.96%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="100%" colspan="9" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>

  </td>

 </tr>

 <tr>

  <td width="100%" colspan="9" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>

  </td>

 </tr>

 <tr>

  <td width="100%" colspan="9" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="100%" colspan="9" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="36%" colspan="5" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:36.0%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ISSUING LENDER</font></p>

  </td>

  <td width="64%" colspan="4" valign="top" style="padding:0in .7pt 0in .7pt;width:64.0%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="32%" colspan="4" valign="top" style="padding:0in .7pt 0in .7pt;width:32.06%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="53%" colspan="4" valign="top" style="padding:0in .7pt 0in .7pt;width:53.72%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.22%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="100%" colspan="9" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">FLEET NATIONAL

  BANK, as Issuing Lender<br><br></font></p>

  </td>

 </tr>

 <tr>

  <td width="8%" valign="top" style="padding:0in .7pt 0in .7pt;width:8.04%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By</font></p>

  </td>

  <td width="77%" colspan="7" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:77.74%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.22%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="100%" colspan="9" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>

  </td>

 </tr>

 <tr>

  <td width="80%" colspan="7" valign="top" style="padding:0in .7pt 0in .7pt;width:80.0%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>

  </td>

  <td width="5%" valign="top" style="padding:0in .7pt 0in .7pt;width:5.78%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.22%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="80%" colspan="7" valign="top" style="padding:0in .7pt 0in .7pt;width:80.0%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="5%" valign="top" style="padding:0in .7pt 0in .7pt;width:5.78%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.22%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="80%" colspan="7" valign="top" style="padding:0in .7pt 0in .7pt;width:80.0%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="5%" valign="top" style="padding:0in .7pt 0in .7pt;width:5.78%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.22%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="59%" colspan="6" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:59.98%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">CASH MANAGEMENT

  BANK</font></p>

  </td>

  <td width="25%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:25.8%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.22%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="59%" colspan="6" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:59.98%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="25%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:25.8%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.22%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="100%" colspan="9" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">FLEET NATIONAL

  BANK, as Cash Management Bank<br><br></font></p>

  </td>

 </tr>

 <tr>

  <td width="8%" valign="top" style="padding:0in .7pt 0in .7pt;width:8.04%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By</font></p>

  </td>

  <td width="77%" colspan="7" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:77.74%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.22%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="100%" colspan="9" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>

  </td>

 </tr>

 <tr>

  <td width="31%" colspan="3" valign="top" style="padding:0in .7pt 0in .7pt;width:31.92%;">

  <p style="margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>

  </td>

  <td width="53%" colspan="5" valign="top" style="padding:0in .7pt 0in .7pt;width:53.84%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;page-break-after:avoid;">&nbsp;</p>

  </td>

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<p align="right" style="color:black;font-weight:bold;margin:0in 0in .0001pt;text-align:right;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">Exhibit 10.1</font></b></p>



<p style="color:black;font-weight:bold;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-weight:normal;">&nbsp;</font></b></p>



<p style="color:black;font-weight:bold;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">EMPLOYMENT AGREEMENT</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This EMPLOYMENT AGREEMENT

(&#147;Agreement&#148;) made effective as of September 16, 2002 by and between

Alternative Resources Corporation, and its successors and assigns, (the

&#147;Company&#148;) and Bill McLendon (the &#147;Executive&#148;).</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In consideration of the mutual

covenants contained in this Agreement, the parties hereby agree as follows:</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION I</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">EMPLOYMENT</font></u></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company agrees to employ

the Executive, and the Executive agrees to be employed by the Company for the

Period of Employment as provided in Section III A. below upon the terms and

conditions provided in the Agreement.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION II</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">POSITION AND RESPONSIBILITIES</font></u></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During the Period of

Employment, the Executive agrees to serve as Senior Vice President of the

Company in accordance with the By-laws and at the request of the Chief

Executive Officer. He is to assume both the management responsibilities

expected of an officer holding such positions in accordance with the By-laws

and such other responsibilities consistent with such positions as may be

assigned to the Executive from time to time by the CEO.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION III</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">TERMS AND DUTIES</font></u></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Period of Employment</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The term of Executive&#146;s

employment under this Agreement will commence as of the effective date hereof,

and shall continue for an initial term of through August 31, 2004 and shall

automatically be extended year to year thereafter, subject, however, to

termination at any time as provided in this Agreement (the &#147;Period of

Employment&#148;).</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">B.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Duties</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During the Period of

Employment, the Executive shall devote all of his business time, attention and

skill to the business and affairs of the Company and its subsidiaries and not

engage in any other activities (whether or not for gain, profit or other

pecuniary advantage), except as provided below with the Company&#146;s consent.&#160; Executive shall perform faithfully the

duties assigned to him hereunder to the best of his abilities and agrees to

carry out the duties of his position and offices in the best interests of the

Company.&#160; Executive covenants, warrants

and represents that he shall:&#160; (i)

devote his full and best efforts to the fulfillment of his employment

obligation; (ii) exercise the highest ethical standards, the highest degree of

loyalty, and the highest standards of conduct in the performance of his duties;

and (iii) do nothing which he knows or should know</font></p>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>





<div style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



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</font></div>



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<p align="center" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">will harm or could harm the

business or reputation of the Company.&#160;

Executive shall at all times abide by all policies and procedures of the

Company as in effect or amended from time to time in the sole discretion of

such entity, Executive may (i) participate in the affairs of any governmental,

educational or other charitable institution, or engage in professional speaking

and writing activities, so long as the Board of Directors of the Company does

not determine, in good faith, that such activities unreasonably interfere with

the business of the Company or diminish the Executive&#146;s obligations under the

Agreement; or (ii) serve as a member of the board of directors of other

corporations, so long as the Board of Directors of the Company, specifically

approves such service in its sole and absolute discretion, and in either case,

the Executive shall be entitled to retain all fees, royalties and other

compensation derived from such activities in addition to the compensation and

other benefits payable to him under the Agreement; and provided further, that

the Executive may invest his personal or family funds in any form or manner he

may choose that will not require any services on his part in the operation of

or the affairs of the companies in which such investments are made.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION IV</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">COMPENSATION AND BENEFITS</font></u></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Base Salary</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During the Period of

Employment, the Company agrees to pay the Executive a base salary at the annual

rate (&#147;Base Salary&#148;) of Two Hundred Thousand Dollars ($200,000). Such Base

Salary shall be payable according to the customary payroll practices of the

Company, but in no event less frequently than bi-weekly installments.&#160; The Executive may be eligible for base

salary increases as indicated by performance and/or market justification,

solely at the discretion of the Chief Executive Officer and as approved by the

Board of Directors.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">B.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Annual Incentive Awards</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:black;margin:0in 0in .0001pt;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">For

the 2002 calendar year, the Executive shall be eligible to earn incentive

compensation of up to 100% of his pro-rated Base Salary, based upon performance

targets to be determined by the Board.&#160;

For subsequent years, the Executive shall be eligible to earn incentive

compensation of up to 100% of his Base Salary (pro-rated in the case of partial

years), based upon performance targets to be determined by the Board.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">C.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Options</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company shall grant to the Executive the

following options and warrants:</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1) An option to purchase 150,000 shares of

common stock of the Company with an exercise price equal to fair market value

per share on the date granted (&#147;FMV Options&#148;).&#160;

Vesting shall occur in four equal annual installments on the first,

second, third and fourth anniversaries of the date hereof, so long as Executive

remains employed by the Company on the vesting dates.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2) A warrant from Wynnchurch Capital to

purchase 150,000 shares of common stock of the Company with a $.73 strike

price. Vesting shall occur under a two-part vesting schedule:</font></p>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2</font></p>





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<p align="center" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;">&nbsp;</p>



<p style="color:windowtext;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">i)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; in

four equal annual installments on the first, second, third and fourth

anniversaries of the date hereof, so long as Executive remains employed by the

Company on the vesting dates; and</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;

a performance vesting component requires that the warrant can be exercised only

if the Company stock price achieves the following thresholds:</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font>

1st 50,000 warrant shares - $.75/share average trading price over 30 day

period;</p>



<p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font>

2nd 50,000 warrant shares - $1.50/share average trading price over 30 day

period;</p>



<p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font>

3rd 50,000 warrant shares - $2.50/share average trading price over 30 day

period</p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Notwithstanding the foregoing:</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; if the Period of Employment ends because the Company ends

the automatic extension thereof under Section III A. of this Agreement; (ii)

the Company terminates the employment of the Executive Without Cause as defined

in Section VIII; (iii) the Executive&#146;s employment hereunder terminates because

of his death or disability (as defined in Section VI); or (iv) there is a

change in control of the Company, such options and warrants shall become fully

vested and exercisable and shall remain exercisable for the remainder of their

terms as specified in those options.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; For purposes of this Agreement, a &#147; change in control&#148; of

the Company shall be deemed to occur at the effective time of (i) a merger or

consolidation of the Company with one or more other corporations as a result of

which the holders of the outstanding voting stock of the Company immediately

prior to such merger or consolidation (other than the surviving or resulting

corporation or any affiliate thereof) hold less than 50% of the voting stock of

the surviving or resulting corporation, or (ii) a transfer of more than 50% (in

value) of the assets of the Company other than to a transferee in which the

Company owns at least 50% of the voting stock immediately prior to the

consummation of such transaction.<b><font style="font-weight:bold;">&#160; </font></b>Solely

for the purposes of this definition, the Wynnchurch Capital entities shall

always be deemed to hold the shares into or for which any convertible

securities and warrants held by them are convertible or exercisable, and such

shares shall be deemed outstanding,</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">D.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Additional Benefits</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Executive shall be entitled to

receive a paid vacation of four (4) weeks during each twelve (12) month period

during the Period of Employment, which may be used in accordance with Company

policy.&#160; The Executive will also be

entitled to participate in all group hospitalization, health, dental care, life

or other insurance, tax qualified pension, savings, thrift and profit sharing

plans, sick leave plans, travel or accident insurance and short and long term

disability insurance plans or programs for which salaried executive employees

generally are eligible under any existing or future plan or program established

by the Company.&#160; Nothing in this

Agreement will preclude the Company from amending or terminating any of the

plans or programs applicable to salaried executive employees of the Company.&#160; This Agreement is otherwise in lieu of

entitlement to any other generally available benefits, perquisites or matters

of compensation.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During the Period of

Employment, the Company shall pay Executive&#146;s private life insurance premiums

(not to exceed $1,440 per annum) and his private disability insurance premiums

(not</font></p>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3</font></p>





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</font></div>



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<p align="center" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">to exceed $4,650 per

annum).&#160; The Company may pay those

premiums in installments, if permitted by the terms of the policies.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION V</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">BUSINESS EXPENSES</font></u></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company will reimburse the Executive

for all reasonable travel and other expenses incurred by the Executive in

connection with the performance of his duties and responsibilities under this

Agreement.&#160; Executive must support all

expenditures with customary receipts and expense reports subject to review by

the Company&#146;s Chief Financial Officer or Chief Executive Officer.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION VI</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">DISABILITY</font></u></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Payments</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Executive&#146;s employment

hereunder may be terminated by the Company if (i) Executive becomes physically

or mentally incapacitated, (ii) is unable for a period of one hundred eighty

(180) consecutive days to perform his material duties and responsibilities and

(iii) a determination is made regarding Executive&#146;s continued incapacity by a

physician appointed by the Company (such continued incapacity is hereinafter

referred to as &#147;disability&#148;).&#160; Upon any

such termination for disability, Executive shall be entitled to receive (i) his

Base Salary pro-rated through the date that he becomes eligible for long term

disability; (ii) any earned annual incentive award, prorated through the date

on which the Executive is first determined to be disabled, payable when such

award would normally be determined to be earned and payable and (iii) his

accrued benefits under the terms of the plans and policies of the Company in

which he participates.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">B.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Assistance to the Company</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During the period the Executive

is receiving payments of either regular compensation, severance or disability

insurance benefits described in this Agreement and as long as he is physically

and mentally able to do so, the Executive will furnish information and

assistance to the Company and from time to time will make himself available to

the Company with respect to areas and matters in which he was involved during

his employment with the Company.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;page-break-after:avoid;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION VII</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;page-break-after:avoid;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">DEATH</font></u></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In the event

of the death of the Executive during the Period of Employment, (i) Executive&#146;s

estate shall be entitled to receive his Base Salary, pro-rated through the date

of death plus any earned annual incentive award, prorated through the date of

death and payable when such award would normally be determined to be earned and

payable and (ii) Executive&#146;s designated beneficiary or estate, as the case may

be, shall be entitled to his accrued benefits, under the terms of the plans and

policies of the Company in which he participates.</font></p>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4</font></p>





<div style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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<p align="center" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION VIII</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">EFFECT OF TERMINATION OF EMPLOYMENT</font></u></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Termination Without Cause or for Good Reason</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company shall have the

right to terminate Executive&#146;s employment at any time Without Cause, upon

written notice.&#160; Executive shall have

the right to terminate his employment for Good Reason upon written notice.&#160; If the Company terminates Executive&#146;s

employment Without Cause or the Executive terminates such employment for Good

Reason, then upon execution of a general release in favor of the Company and

its officers, directors employees, agent and attorneys, and conditional upon

both expiration of all statutory revocation periods without revocation and

continued compliance with the post-termination obligations of this Agreement,

Company will pay to the Executive severance at the then current annual rate of

Base Salary for a period of&#160; twelve

months, payable in accordance with normal payroll practices. &#160;Earned but unpaid Base Salary will be paid in

a lump sum at the time of such termination.&#160;

The Company also will pay the Executive a prorated portion of any earned

annual incentive award for the year in which the termination occurred, payable

at the time such award would normally be determined earned and payable.&#160; Executive shall be entitled to continue his

current group health plan coverage, at the same cost (subject to generally

imposed increases), in accordance with his current group health plan elections

and the Company shall continue to pay Executive&#146;s private life insurance and

private disability insurance premiums as specified in Section IV for the term

of severance payments</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">B.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Termination With Cause</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company shall have the

right to terminate Executive&#146;s employment With Cause upon written notice. If

the Company terminates Executive With Cause, Executive shall be entitled to

receive solely his Base Salary prorated through the date of Executive&#146;s

termination, and his accrued benefits (excluding incentive award) under the

terms of the plans, policies and procedures of the Company.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">C.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Resignation</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Executive shall have the right

to voluntarily resign his employment without Good Reason at any time (including

by reason of retirement) upon two weeks&#146; prior notice to the Company.&#160; If Executive voluntarily terminates his

employment with the Company other than for Good Reason (which is governed by

Paragraph A. of this Section) at any time, Executive shall be entitled to

receive solely his Base Salary prorated through the date of Executive&#146;s

voluntary termination, and his accrued benefits under the terms of the plans,

policies and procedures of the Company (other than incentive awards).</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">D.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Definitions</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">For this Agreement, the

following terms have the following meanings:</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Termination &#147;With Cause&#148; means termination of the

Executive&#146;s employment by the Company&#146;s Board of Directors acting in good faith

by written notice by the Company to the</font></p>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5</font></p>





<div style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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</font>



<p align="center" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Executive specifying the event

relied upon for such termination, due to (i) breach of Executive&#146;s obligation

to utilize his best efforts in performance of his duties or any other material

term of this Agreement which is not cured (but only if the circumstances would

permit a cure) to the Board&#146;s satisfaction within ten business days (or such

shorter period as circumstances reasonably require) following written notice

specifying the breach and the cure required (ii) the Executive&#146;s breach of his

fiduciary duties to the Company or his gross negligence or willful misconduct,

including, but not limited to, conviction for a felony or perpetration of a

common law fraud, or&#160; (iii) failure to

follow specific directions and orders of the Board of Directors pertaining to

the Executive&#146;s duties under this agreement.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(2)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Termination &#147;Without Cause&#148; means termination by the

Company of the Executive&#146;s employment other than due to death, disability, or

termination With Cause.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:black;margin:0in 0in .0001pt;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">(3)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Termination for &#147;Good Reason&#148; means

termination of the Executive&#146;s employment by the Executive within twelve (12)

months after (i) the Company fails to elect or maintain the Executive as Senior

Vice President (ii) the Executive&#146;s duties, responsibilities or authority under

this Agreement are materially reduced or diminished other than pursuant to the

Board&#146;s exercise of its absolute rights of direction and control (iv) the

compensation received by the Executive is reduced in the aggregate (other than

as a result of adjustments applied uniformly to all executive employees), and

such reduction is not remedied within thirty (30) days of the Executive&#146;s

notice to the Company thereof, (v) the Company violates any other material

terms of the Agreement which is not cured within 30 days following written

notice to the Company specifying the violation and the required cure, or (vii)

there is a liquidation, dissolution, or change of control of the Company.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION IX</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">OTHER DUTIES OF THE EXECUTIVE DURING AND

AFTER THE PERIOD OF EMPLOYMENT</font></u></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Cooperation During and After Employment</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Executive will, with

reasonable notice during or after the Period of Employment, furnish information

as may be in his possession and cooperate with the Company as may reasonably be

requested in connection with any claims or legal actions in which the Company

is or may become a party.&#160; During any

severance period, Executive agrees to be reasonably available to assist in

transition.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">B.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Confidential Information</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Executive recognizes and

acknowledges that all information pertaining to the affairs, business, clients,

customers or other relationships of the Company, as hereinafter defined, is

confidential and is a unique and valuable asset of the Company.&#160; Access to and knowledge of this information

are essential to the performance of the Executive&#146;s duties under this

Agreement.&#160; The Executive will not

during the Period of Employment or after, except to the extent reasonably

necessary in performance of the duties under this Agreement, give to any

person, firm, association, corporation or governmental agency any information

concerning the affairs,</font></p>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6</font></p>





<div style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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<p align="center" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">business, clients, customers or

other relationships of the Company, except as required by law.&#160; The Executive will not make use of this type

of information for his own purposes or for the benefit of any person or

organization other than the Company.&#160;

The Executive will also use his best efforts to prevent the disclosure

of this information by others.&#160; All

records, memoranda, etc., relating to the business of the Company, whether made

by the Executive or otherwise coming into his possession, are confidential and

will remain the property of the Company.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">C.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Certain Restricted Activities</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During the Period of Employment

and for a one (1) year period thereafter, the Executive will not use his status

with the Company to obtain goods or services from another organization other

than in the ordinary course of business.&#160;

During the Period of Employment and for a one (1) year period following

termination of the Period of Employment:&#160;

the Executive will not make any statements or perform any acts intended

to advance the interest of any existing or prospective competitors of the

Company or its subsidiaries in any way that will injure the interest of the

Company or its subsidiaries; the Executive, without prior express written

approval by the Board of Directors of the Company, will not directly or

indirectly own or hold any proprietary interest in or be employed by or receive

compensation from any party engaged in the same or any similar business in the

same geographic areas the Company or its subsidiaries do business; and the

Executive, without express prior written approval from the Board of Directors,

will not solicit any members of the then current customers, clients or

suppliers of the Company or its subsidiaries or discuss with any employee of

the Company or its subsidiaries information or operation of any business

intended to compete with the Company or its subsidiaries.&#160; For the purposes of the Agreement,

proprietary interest means legal or equitable ownership, whether through stock

holdings or otherwise, of a debt or equity interest (including options,

warrants, rights and convertible interest) in a business firm or entity, or

ownership of more than 2% of any class of equity interest in a publicly-held

company.&#160; The Executive acknowledges

that the covenants contained herein are reasonable as to geographic and

temporal scope.&#160; For a twelve (12) month

period after termination of the Period of Employment for any reason, the

Executive will not hire any employee of the Company or its subsidiaries or

solicit, other than by means of a general solicitation to the public such as a

newspaper advertisement, or encourage any such employee to leave the employ of

the Company or its subsidiaries.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">D.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Remedies</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Executive acknowledges that

his breach or threatened or attempted breach of any provision of Section IX

would cause irreparable harm to the Company not compensable in monetary damages

and that the Company shall be entitled, in addition to all other applicable

remedies, to a temporary and permanent injunction and a decree for specific

performance of the terms of Section IX without being required to prove damages

or furnish any bond or other security.&#160;

The Executive hereby acknowledges the necessity of protection against

the competition of, and certain other possible adverse actions by, the

Executive and that the nature and scope of such protection has been carefully

considered by the parties.&#160; The period

provided and the area covered are expressly represented and agreed to be fair,

reasonable and necessary.&#160; If, however,

any court or arbitrator determines that the restrictions described herein are

not reasonable, the</font></p>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7</font></p>





<div style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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<p align="center" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">court or arbitration panel may

modify, rewrite or interpret such restrictions to include as much of their

nature and scope as will render them enforceable.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION X</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">INDEMNIFICATION, LITIGATION</font></u></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company will indemnify the

Executive to the fullest extent permitted by the laws of the state of

incorporation in effect at that time, or certificate of incorporation and

by-laws of the Company whichever affords the greater protection to the

Executive. The Company will use its best efforts to obtain and maintain customary

directors and officer liability insurance, covering Executive. The foregoing

indemnification shall continue to apply following termination of the Period of

Employment for actions or omissions during the Period of Employment.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION XI</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">WITHHOLDING TAXES</font></u></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company may directly or

indirectly withhold from any payments under this Agreement all federal, state,

city or other taxes that shall be required pursuant to any law or governmental

regulation.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION XII</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">EFFECT OF PRIOR AGREEMENTS</font></u></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This Agreement contains the

entire understanding between the Company and the Executive with respect to the

subject matter and supersedes any prior employment, or consulting

agreements&#160; or letters of understanding

between the Company, its predecessors and its affiliates, and the Executive.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION XIII</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">MODIFICATION</font></u></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This Agreement may not be

modified or amended except in writing signed by the parties.&#160; No term or condition of this Agreement will

be deemed to have been waived, except in writing by the party charged with waiver.&#160; A waiver shall operate only as to the

specific term or condition waived and will not constitute a waiver for the

future or act on anything other than that which is specifically waived.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION XIV</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">GOVERNING LAW; ARBITRATION</font></u></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This Agreement and its

validity, interpretation, performance and enforcement shall be governed by the

laws of the State of Illinois, without giving effect to the choice of law

provisions thereof.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:black;margin:0in 0in .0001pt;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">In

the event there should be any controversy or dispute arising with respect to this

Employment Agreement between the Executive and the Company, the parties agree

properly and in good faith to attempt to settle such dispute amicably.&#160; In the event that the parties are unable to

do so, any</font></p>



<p align="center" style="color:black;margin:0in 0in .0001pt;text-align:center;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="color:black;margin:0in 0in .0001pt;text-align:center;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">8</font></p>





<div style="color:black;margin:0in 0in .0001pt;"><font size="2" color="black" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" color="black" face="Times New Roman" style="color:black;font-size:10.0pt;">
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<p align="center" style="color:black;margin:0in 0in .0001pt;text-align:center;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">&nbsp;</font></p>



<p style="color:black;margin:0in 0in .0001pt;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">such

controversy or dispute shall be settled by arbitration held in Chicago,

Illinois in accordance with the rules of the American Arbitration Association

for the resolution of Employment Disputes then in effect, except as otherwise

provided herein. &#160;Any and all awards

rendered by the arbitration shall be final and binding upon the parties.&#160; In no event may an arbitrator allow any

party to join claims of any other employee in a single arbitration proceeding

without both parties&#146; written consent.&#160;

Executive and the Company agree that, without regard to the amount at

stake, all claims submitted to arbitration shall be decided by a single

arbitrator.&#160; Executive and the Company

further acknowledge and agree that any dispute or claim arising under the Age Discrimination

in Employment Act, Title VII of the Civil Rights Act of 1964 as amended by the

Civil Rights Act of 1991, the Americans With Disabilities Act, the Employee

Retirement Income Security Act of 1974, Illinois Human Rights Act, the Cook

County and Chicago Human Rights Ordinances, and any other federal, state or

local statute or ordinance, rule and/or regulation, public policy or tort law

(regardless of whether statutory or common law origin), shall be subject to,

and must be resolved by, arbitration as provided in this Section.&#160;&#160; Judgment may be entered on the arbitrator&#146;s

award in any court of competent jurisdiction.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION XV</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">NOTICES</font></u></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">All notices, requests, consents

and other communications hereunder shall be in writing and shall be deemed to

have been made when delivered or mailed first-class postage prepaid by

registered mail, return receipt requested, or when delivered if by hand,

overnight delivery services or confirmed facsimile transmission, to the

following:</font></p>



<p style="color:black;margin:0in 0in .0001pt;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; If to the Company, at:</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Alternative Resources Corporation</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">600 Hart Road, Suite 300,</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Barrington, Illinois&#160; 60010</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<h1 style="color:black;font-weight:bold;margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">Attention: Chairman</font></b></h1>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">or at such other address as may

have been furnished to the Executive by the Company in writing, or</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; If to the Executive, at the address he has furnished to

the Company in writing.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION XVI</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">BINDING AGREEMENT</font></u></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This Agreement shall be binding

on the parties&#146; successors, heirs and assigns.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9</font></p>





<div style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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</font>



<p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SECTION XVII</font></b></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">MISCELLANEOUS</font></u></b></p>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Multiple Counterparts</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This Agreement

may be executed simultaneously in multiple counterparts each of the same force

and effect.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">B.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Severability</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">If any phrase, clause or

provision of this Agreement is declared invalid or unenforceable by an

arbitrator or court of competent jurisdiction, such phrase, clause or provision

shall be deemed severed from this Agreement, but will not affect any other

provisions of this Agreement, which shall otherwise remain in full force and

effect.&#160; In addition, there will be

automatically substituted herein for such severed phrase, clause or provision a

phrase, clause or provision as similar as possible which is valid and

enforceable.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">C.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Headings</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The headings and subheadings of

this Agreement are inserted for convenience of reference only and are not to be

considered in construction of the provisions hereof.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">D.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Construction</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company and the Executive

acknowledge that this Agreement was the result of arm&#146;s-length negotiations

between sophisticated parties each represented by legal counsel.&#160; Each and every provision of this Agreement

shall be construed as though both parties participated equally in the drafting

of same, and any rule of construction that a document shall be construed

against the drafting party shall not be applicable to this Agreement.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">E.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Survivorship</u></font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The provisions of Sections

IV-XVII shall survive the termination or expiration of this Agreement.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">IN WITNESS WHEREOF, the

undersigned have executed this Agreement as of the date first above written.</font></p>



<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">

 <tr>

  <td width="76%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:76.12%;">

  <p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">COMPANY</font></u></b></p>

  </td>

  <td width="23%" valign="top" style="padding:0in 0in 0in 0in;width:23.88%;">

  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="76%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:76.12%;">

  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="23%" valign="top" style="padding:0in 0in 0in 0in;width:23.88%;">

  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="76%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:76.12%;">

  <p style="color:black;margin:0in 0in .0001pt;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">ALTERNATIVE RESOURCES CORPORATION</font></p>

  </td>

  <td width="23%" valign="top" style="padding:0in 0in 0in 0in;width:23.88%;">

  <p style="color:black;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="76%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:76.12%;">

  <p style="color:black;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="23%" valign="top" style="padding:0in 0in 0in 0in;width:23.88%;">

  <p style="color:black;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.96%;">

  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>

  </td>

  <td width="29%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:29.84%;">

  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="42%" valign="top" style="padding:0in 0in 0in 0in;width:42.32%;">

  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="23%" valign="top" style="padding:0in 0in 0in 0in;width:23.88%;">

  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="76%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:76.12%;">

  <p style="color:windowtext;margin:0in 0in .0001pt 60.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">George Watts, CEO</font></p>

  </td>

  <td width="23%" valign="top" style="padding:0in 0in 0in 0in;width:23.88%;">

  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="76%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:76.12%;">

  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="23%" valign="top" style="padding:0in 0in 0in 0in;width:23.88%;">

  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="76%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:76.12%;">

  <p style="color:windowtext;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">EXECUTIVE</font></u></b></p>

  </td>

  <td width="23%" valign="top" style="padding:0in 0in 0in 0in;width:23.88%;">

  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="76%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:76.12%;">

  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="23%" valign="top" style="padding:0in 0in 0in 0in;width:23.88%;">

  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="3%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:3.96%;">

  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="29%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:29.84%;">

  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="42%" valign="top" style="padding:0in 0in 0in 0in;width:42.32%;">

  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="23%" valign="top" style="padding:0in 0in 0in 0in;width:23.88%;">

  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="3%" valign="top" style="border:none;padding:0in 0in 0in 0in;width:3.96%;">

  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>

  </td>

  <td width="29%" valign="top" style="border:none;padding:0in 0in 0in 0in;width:29.84%;">

  <p style="color:windowtext;margin:0in 0in .0001pt 40.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill McLendon</font></p>

  </td>

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  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

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  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

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</table>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10</font></p>





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<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-size:12.0pt;margin:0in 0in .0001pt;"><img width="250" height="104" src="j5154ex10d2image002.jpg"><br clear="ALL">

<font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<br clear="ALL">



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">August 2, 2002</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Miner Smith</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">215 Beacon Knoll Drive</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Alpharetta, GA 30022</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">DearMiner:</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Per our telephone conversation, this letter represents the terms of our

agreement with regard to your separation.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt .5in;text-indent:-.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">1.</font></b><b><font size="1" style="font-size:3.0pt;font-weight:bold;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font></b><b><font size="2" style="font-size:10.0pt;font-weight:bold;">Payments and Other Consideration</font></b><font size="2" style="font-size:10.0pt;">: If you sign

and do not revoke this Agreement, ARC will agree to the following:</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">ARC will pay you twenty-five

thousand dollars ($25,000) in a lump sum, from which all applicable payroll

taxes and withholdings will be made, within 10 days of the receipt of this

signed agreement.</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">ARC will pay you an

additional two hundred thousand dollars ($200,000), in the form of salary

continuation, in twenty six (26) bi-weekly installments of seven thousand, six

hundred ninety two dollars and thirty cents ($7,692.30) over a period of 12

months.&#160; During that time period, you

will remain an employee of record, eligible to participate in the company

medical benefit plan.&#160; You will not be

eligible to accrue additional vacation and your final check will include

payment for any unpaid, accrued, but unused, vacation as of August 1, 2002.</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">ARC will permit you to

retain the laptop computer in your possession.</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">ARC agrees to waive the

non-compete clause.</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">ARC agrees to provide

outsourcing assistance through a recognized outplacement firm in your

geographic area.&#160; I will make those

arrangements and provide that information to you no later than 7 days from

receipt of this signed agreement.</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">ARC agrees to waive the

non-compete clause as included in your employment agreement.</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>





<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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<p align="center" style="font-size:12.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p style="margin:0in 0in .0001pt .5in;text-indent:-.5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">2.</font></b><b><font size="1" style="font-size:3.0pt;font-weight:bold;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font></b><b><font size="2" style="font-size:10.0pt;font-weight:bold;">In exchange for the above, you

agree to the following:</font></b></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">You agree not to bring any

lawsuit against ARC and release and waive ARC from all claims or liability

arising out of your employment and/or your separation from employment with ARC

as of the date of this Agreement.&#160;

Excluded from this release are any claims, which cannot be waived by

law, including, but not limited to, the right to file a charge with or

participate in an investigation conducted by certain government agencies,

including the Equal Employment Opportunity Commission.&#160; You are waiving, however, your right to any

monetary recovery should any agency, such as the Equal Employment Opportunity

Commission pursue any claims on your behalf.</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">You agree that the terms of

this Agreement, including, but not limited to, the payments pursuant to this

Agreement shall be kept strictly confidential and shall not be disclosed except

to your attorneys and/or tax advisers or as you may be otherwise legally

required to do so.</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">You agree to return any ARC

property and information in your possession, custody or control, including, but

not limited to, all proprietary business information, technical employee

information, corporate information, any kind of equipment and any other

information or material of any kind that is in any way related to ARC&#146;s

business that has been used by employees or in furtherance of ARC&#146;s

business.&#160; This obligation extends to

all such property or information without regard to the form or manner in which

the property or information is maintained.</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">You agree that with

reasonable notice, you will furnish information as may be in your possession

and cooperate with ARC as may be reasonably requested in connection with any

claims or legal actions in which ARC is or may become a party.</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">You agree to provide me with

the serial number of the laptop in your possession and further agree that any

ARC proprietary and confidential information that remains on the laptop must be

removed from the computer, as well as any software that was installed under ARC&#146;s

license.&#160; ARC reserves the right to

ensure that this information has been removed from the computer, prior to any

payments under this Agreement.</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">You agree that for a period

of one (1) year following August 1, 2002 you will not hire any employee of ARC

or solicit, other than by means of a general solicitation to the public, such

as, a newspaper advertisement, or encourage any such employee to leave the

employ of ARC.</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt .75in;text-indent:-.25in;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&#149;</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">You agree that this

Agreement sets forth the entire agreement between you and ARC and supersedes

any other written or oral understandings.&#160;

You and ARC agree that if any provision of this Agreement or application

thereof is held to be invalid, the invalidity shall not affect other provisions

or applications of this Agreement.</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>





<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



</font></div>



<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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<p align="center" style="font-size:12.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">You have 15 days in which to decide whether to enter into this

Agreement, sign it, and return it to me at Alternative Resources Corporation,

600 Hart Road, Suite 300, Barrington, Illinois, 60010.&#160; The Agreement will not become effective or

binding on you and ARC until 7 days after you sign it.&#160; You may revoke the Agreement during those 7

days by mailing a letter of revocation to me at the above address.&#160; Such a letter must be signed, sent certified

mail, and postmarked no later than the seventh day after the date on which you

signed the Agreement.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Sharon A. McKinney</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Sr. Vice President, Human Resources</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Alternative Resources Corporation</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">

 <tr>

  <td width="30%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:30.88%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="6%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:6.16%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="62%" valign="top" style="padding:0in .7pt 0in .7pt;width:62.96%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="30%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:30.88%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Miner Smith</font></p>

  </td>

  <td width="69%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:69.12%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Date</font></p>

  </td>

 </tr>

</table>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>





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<p align="right" style="margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Exhibit

99.1</font></b></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="font-weight:bold;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350 AS ADOPTED<br>

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002</font></b></p>



<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<h1 style="font-weight:normal;margin:0in 0in .0001pt;page-break-after:avoid;text-indent:27.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In connection with the Quarterly Report of Alternative

Resources Corporation (the &#147;Company&#148;) on Form 10-Q for the period ending

September 30, 2002 as filed with the Securities and Exchange Commission on the

date hereof (the &#147;Report&#148;), the undersigned Chief Executive Officer and Chief

Financial Officer of the Company hereby certify, pursuant to 18 U.S.C. &#167; 1350,

as adopted pursuant to &#167; 906 of the Sarbanes-Oxley Act of 2002, that based on

their knowledge:</font></h1>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1) The Report fully complies with the requirements of Section 13(a) or

15(d) of the Securities Exchange Act of 1934, and</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(2) The information

contained in the Report fairly presents, in all material respects, the

financial condition and results of operations of the Company as of and for the

periods covered in the Report.</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>



<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">

 <tr>

  <td width="39%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:39.38%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/&#160; George W. Watts</font></p>

  </td>

  <td width="10%" valign="top" style="padding:0in .7pt 0in .7pt;width:10.06%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="21%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:21.34%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11/14/02</font></p>

  </td>

  <td width="29%" valign="top" style="padding:0in .7pt 0in .7pt;width:29.22%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

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 <tr>

  <td width="39%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:39.38%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">George W. Watts, Chief Executive Officer</font></p>

  </td>

  <td width="10%" valign="top" style="padding:0in .7pt 0in .7pt;width:10.06%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="50%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:50.56%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Date</font></p>

  </td>

 </tr>

 <tr>

  <td width="39%" valign="top" style="padding:0in .7pt 0in .7pt;width:39.38%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="10%" valign="top" style="padding:0in .7pt 0in .7pt;width:10.06%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="50%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:50.56%;">

  <p style="font-size:12.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="39%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:39.38%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/&#160; Steven Purcell</font></p>

  </td>

  <td width="10%" valign="top" style="padding:0in .7pt 0in .7pt;width:10.06%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="21%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:21.34%;">

  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11/14/02</font></p>

  </td>

  <td width="29%" valign="top" style="padding:0in .7pt 0in .7pt;width:29.22%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

 </tr>

 <tr>

  <td width="39%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:39.38%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Steven Purcell, Chief Financial Officer</font></p>

  </td>

  <td width="10%" valign="top" style="padding:0in .7pt 0in .7pt;width:10.06%;">

  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>

  </td>

  <td width="50%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:50.56%;">

  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Date</font></p>

  </td>

 </tr>

</table>



<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>





<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">



<hr size="2" width="100%" noshade color="gray" align="left">



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