<SUBMISSION>
<ACCESSION-NUMBER>0001179350-08-000016
<TYPE>10-Q
<PUBLIC-DOCUMENT-COUNT>6
<PERIOD>20080331
<FILING-DATE>20080512
<DATE-OF-FILING-DATE-CHANGE>20080512
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>AMERITYRE CORP
<CIK>0000945828
<ASSIGNED-SIC>3011
<IRS-NUMBER>870535207
<STATE-OF-INCORPORATION>NV
<FISCAL-YEAR-END>0630
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>10-Q
<ACT>34
<FILE-NUMBER>000-50053
<FILM-NUMBER>08821544
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>1501 INDUSTRIAL ROAD
<CITY>BOULDER CITY
<STATE>NV
<ZIP>89005
<PHONE>7022931930
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>1501 INDUSTRIAL ROAD
<CITY>BOULDER CITY
<STATE>NV
<ZIP>89005
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>AMERICAN TIRE CORP
<DATE-CHANGED>19951117
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>amty08mar10qfinal.htm
<DESCRIPTION>AMTY 08 MAR 10-Q
<TEXT>
<!doctype html public "-//IETF//DTD HTML//EN">
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<HEAD>
<TITLE>&lt;PAGE&gt; 1</TITLE>
<META NAME="author" CONTENT="User">
<META NAME="date" CONTENT="05/09/2008">
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<BODY style="line-height:12pt; font-family:Times New Roman; font-size:10pt; color:#000000">
<DIV style="width:624px"><P style="margin:0px"><BR></P>
<P style="margin:0px" align=center>UNITED STATES</P>
<P style="margin:0px" align=center>SECURITIES AND EXCHANGE COMMISSION</P>
<P style="margin:0px" align=center>Washington, D.C. &nbsp;20549</P>
<P style="margin:0px" align=center><BR></P>
<P style="line-height:18.667px; margin:0px; font-size:16px" align=center><B>FORM 10-Q</B></P>
<P style="margin:0px">(Mark One)</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934</P>
<P style="margin:0px" align=center><BR></P>
<P style="margin:0px">For the quarterly period ended <B>March 31, 2008</B></P>
<P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=justify>[ &nbsp;] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934</P>
<P style="margin:0px" align=center><BR></P>
<P style="margin:0px">For the transition period from ____________________ to ____________________.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center>Commission file number: <B>&nbsp;000-50053</B></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center><img src="amty08mar10qfinal001.jpg" alt="[amty08mar10qfinal001.jpg]" align=middle height=113.467 width=113.467></P>
<P style="margin:0px" align=center><B><U>AMERITYRE CORPORATION</U></B></P>
<P style="margin:0px" align=center>(Exact name of small business issuer as specified in its charter)</P>
<P style="margin:0px"><BR></P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=319.2></TD><TD width=319.2></TD></TR>
<TR><TD valign=top width=319.2><P style="margin:0px" align=center><U>NEVADA</U></P>
</TD><TD valign=top width=319.2><P style="margin:0px" align=center><U>87-0535207</U></P>
</TD></TR>
<TR><TD valign=top width=319.2><P style="margin:0px" align=center>(State or other jurisdiction of</P>
</TD><TD valign=top width=319.2><P style="margin:0px" align=center>(I.R.S. Employer</P>
</TD></TR>
<TR><TD valign=top width=319.2><P style="margin:0px" align=center>incorporation or organization)</P>
</TD><TD valign=top width=319.2><P style="margin:0px" align=center>Identification No.)</P>
</TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=349.2></TD><TD width=289.2></TD></TR>
<TR><TD valign=top width=349.2><P style="margin:0px" align=center><U>1501 INDUSTRIAL ROAD, BOULDER CITY, NEVADA</U></P>
</TD><TD valign=top width=289.2><P style="margin:0px" align=center><U>89005</U></P>
</TD></TR>
<TR><TD valign=top width=349.2><P style="margin:0px" align=center>(Address of principal executive offices)</P>
</TD><TD valign=top width=289.2><P style="margin:0px" align=center>(Zip Code)</P>
</TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center><U>(702) 294-2689</U></P>
<P style="margin:0px" align=center>(Issuer&#146;s telephone number)</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=justify>&nbsp;&nbsp;Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. &nbsp;Yes <FONT FACE="Wingdings">&#253;</FONT> &nbsp;No <FONT FACE="Wingdings">&#168;</FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">&nbsp;&nbsp;Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. &nbsp;See the definitions of &#147;large accelerated filer,&#148; &#147;accelerated filer&#148; and &#147;smaller reporting company&#148; in Rule 12b-2 of the Exchange Act.</P>
<P style="margin:0px" align=justify><BR></P>
<P style="margin:0px" align=justify>Large accelerated filer &nbsp;<FONT FACE="Wingdings">&#168;</FONT> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accelerated filer &nbsp;<FONT FACE="Wingdings">&#253;</FONT> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-accelerated filer &nbsp;&nbsp;&nbsp;<FONT FACE="Wingdings">&#168;</FONT> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Smaller reporting company <FONT FACE="Wingdings">&#168;</FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=justify>Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). &nbsp;Yes &nbsp;<FONT FACE="Wingdings">&#168;</FONT> &nbsp;No<FONT FACE="Wingdings">&#253;</FONT></P>
<P style="margin:0px" align=justify><BR></P>
<P style="margin:0px">&nbsp;The number of shares outstanding of Registrant&#146;s Common Stock as of May 12, 2008: <U>23,418,423</U></P>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always"><BR></P>
<P style="margin:0px" align=center>PART I - FINANCIAL INFORMATION</P>
<P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=center>ITEM 1. &nbsp;FINANCIAL STATEMENTS</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q pursuant to the rules and regulations of the Securities and Exchange Commission and, therefore, do not include all information and footnotes necessary for a complete presentation of our financial position, results of operations, cash flows, and stockholders' equity in conformity with generally accepted accounting principles. &nbsp;In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature. </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">Our unaudited balance sheet at March 31, 2008 and our audited balance sheet at June 30, 2007; the related unaudited statements of operations for the three and nine month periods ended March 31, 2008 and 2007; and the related unaudited statement of cash flows for the nine month periods ended March 31, 2008 and 2007, are attached hereto.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=justify><BR>
<BR></P>
<P style="margin:0px" align=center>2</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always" align=justify><BR></P>
<P style="margin:0px"><BR></P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=423.733></TD><TD width=21.067></TD><TD width=95.2></TD><TD width=15.733></TD><TD width=21.067></TD><TD width=95.2></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=672 colspan=6><P style="margin:0px" align=center>AMERITYRE CORPORATION</P>
</TD></TR>
<TR><TD valign=top width=672 colspan=6><P style="margin:0px" align=center>Balance Sheets</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=423.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=95.2><P style="margin:0px" align=center>Mar. 31, 2008</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=95.2><P style="margin:0px" align=center>June 30, 2007</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.2><P style="margin:0px" align=center>(unaudited)</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=423.733><P style="margin:0px">ASSETS</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=423.733><P style="margin:0px">CURRENT ASSETS</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=423.733><P style="margin:0px">&nbsp;&nbsp;Cash and cash equivalents</P>
</TD><TD valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD valign=bottom width=95.2><P style="margin:0px" align=right>2,666,703&nbsp;</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD valign=bottom width=95.2><P style="margin:0px" align=right>5,788,602&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="margin:0px">&nbsp;&nbsp;Accounts receivable &#150; net</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="margin:0px" align=right>469,865&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="margin:0px" align=right>349,125&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=423.733><P style="margin:0px">&nbsp;&nbsp;Inventory </P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.2><P style="margin:0px" align=right>727,254&nbsp;</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.2><P style="margin:0px" align=right>739,710&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="margin:0px">&nbsp;&nbsp;Prepaid expenses and other current assets</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="margin:0px" align=right>222,341&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="margin:0px" align=right>88,930&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=423.733><P style="margin:0px">&nbsp;&nbsp;Deposit on equipment</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=95.2><P style="margin:0px" align=right>175,159&nbsp;</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=95.2><P style="margin:0px" align=right>68,653&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=423.733><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Current Assets</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=95.2><P style="margin:0px" align=right>4,261,322&nbsp;</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=95.2><P style="margin:0px" align=right>7,035,020&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=423.733><P style="margin:0px">PROPERTY AND EQUIPMENT </P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=423.733><P style="margin:0px">&nbsp;&nbsp;Leasehold Improvements</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.2><P style="margin:0px" align=right>160,976&nbsp;</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.2><P style="margin:0px" align=right>157,410&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="margin:0px">&nbsp;&nbsp;Molds and models</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="margin:0px" align=right>391,065&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="margin:0px" align=right>382,973&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=423.733><P style="margin:0px">&nbsp;&nbsp;Equipment</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.2><P style="margin:0px" align=right>2,858,431&nbsp;</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.2><P style="margin:0px" align=right>2,834,615&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="margin:0px">&nbsp;&nbsp;Furniture and Fixtures</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="margin:0px" align=right>96,451&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="margin:0px" align=right>84,455&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=423.733><P style="margin:0px">&nbsp;&nbsp;Software</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.2><P style="margin:0px" align=right>280,337&nbsp;</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.2><P style="margin:0px" align=right>280,337&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="margin:0px">&nbsp;&nbsp;Less &#150; accumulated depreciation</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=95.2><P style="margin:0px" align=right>(2,763,658)</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=95.2><P style="margin:0px" align=right>(2,560,966)</P>
</TD></TR>
<TR><TD valign=top width=423.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Property and Equipment</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=95.2><P style="margin:0px" align=right>1,023,602&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=95.2><P style="margin:0px" align=right>1,178,824&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=423.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="margin:0px">OTHER ASSETS</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=423.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="margin:0px">&nbsp;&nbsp;Patents and trademarks &#150; net </P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="margin:0px" align=right>629,631&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="margin:0px" align=right>578,915&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=423.733><P style="margin:0px">&nbsp;&nbsp;Deposits</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=95.2><P style="margin:0px" align=right>39,918&nbsp;</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=95.2><P style="margin:0px" align=right>36,000&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=423.733><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Other Assets</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=95.2><P style="margin:0px" align=right>669,549&nbsp;</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=95.2><P style="margin:0px" align=right>614,915&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=423.733><P style="margin:0px">TOTAL ASSETS</P>
</TD><TD valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD style="border-bottom:2.667px double #000000" valign=bottom width=95.2><P style="margin:0px" align=right>5,954,473&nbsp;</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD style="border-bottom:2.667px double #000000" valign=bottom width=95.2><P style="margin:0px" align=right>8,828,759&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=423.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=423.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=95.2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=95.2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=672 colspan=6><P style="margin:0px" align=center>The accompanying notes are an integral part of these unaudited financial statements.</P>
</TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px" align=center>3</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always"><BR></P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=422.8></TD><TD width=21.067></TD><TD width=95.667></TD><TD width=15.733></TD><TD width=21.067></TD><TD width=95.667></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=672 colspan=6><P style="margin:0px" align=center>AMERITYRE CORPORATION</P>
</TD></TR>
<TR><TD valign=top width=672 colspan=6><P style="margin:0px" align=center>Balance Sheets (Continued)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=422.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=422.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=95.667><P style="margin:0px" align=center>Mar. 31, 2008</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=95.667><P style="margin:0px" align=center>June 30, 2007</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=422.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.667><P style="margin:0px" align=center>(unaudited)</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=422.8><P style="margin:0px">LIABILITIES AND STOCKHOLDERS&#146; EQUITY</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=422.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=422.8><P style="margin:0px">CURRENT LIABILITIES</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=422.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=422.8><P style="margin:0px">&nbsp;&nbsp;Accounts payable</P>
</TD><TD valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD valign=bottom width=95.667><P style="margin:0px" align=right>178,106&nbsp;</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD valign=bottom width=95.667><P style="margin:0px" align=right>327,859&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=422.8><P style="margin:0px">&nbsp;&nbsp;Accrued expenses</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.667><P style="margin:0px" align=right>53,787&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.667><P style="margin:0px" align=right>292,667&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=422.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-top:1px solid #000000" valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-top:1px solid #000000" valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=422.8><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Current Liabilities</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=95.667><P style="margin:0px" align=right>231,893&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=95.667><P style="margin:0px" align=right>620,526&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=422.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=422.8><P style="margin:0px">TOTAL LIABILITIES</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=95.667><P style="margin:0px" align=right>231,893&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=95.667><P style="margin:0px" align=right>620,526&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=422.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=422.8><P style="margin:0px">COMMITMENTS AND CONTINGENCIES </P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=422.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=422.8><P style="margin:0px">STOCKHOLDERS&#146; EQUITY</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=422.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=422.8><P style="margin:0px; padding-left:8.8px; text-indent:-8.8px">&nbsp;&nbsp;Preferred stock: 5,000,000 shares authorized of $0.001 par value, -0- &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares issued and outstanding</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.667><P style="margin:0px" align=right>-&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.667><P style="margin:0px" align=right>-&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=422.8><P style="margin:0px; padding-left:8.8px; text-indent:-8.8px">&nbsp;&nbsp;Common stock: 40,000,000 shares authorized of $0.001 par value, &nbsp;&nbsp;23,418,423 and 23,416,551 shares issued and outstanding, respectively</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="margin:0px" align=right>23,416&nbsp;</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="margin:0px" align=right>23,414&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=422.8><P style="margin:0px">&nbsp;&nbsp;Additional paid-in capital</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.667><P style="margin:0px" align=right>56,091,910&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.667><P style="margin:0px" align=right>55,608,790&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=422.8><P style="margin:0px">&nbsp;&nbsp;Accrued interest on notes receivable</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="margin:0px" align=right>(17,018)</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="margin:0px" align=right>(3,074)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=422.8><P style="margin:0px">&nbsp;&nbsp;Notes receivable</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.667><P style="margin:0px" align=right>(399,329)</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=95.667><P style="margin:0px" align=right>(600,000)</P>
</TD></TR>
<TR><TD valign=top width=422.8><P style="margin:0px">&nbsp;&nbsp;Deferred consulting and directors&#146; compensation</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="margin:0px" align=right>(53,330)</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="margin:0px" align=right>(25,000)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=422.8><P style="margin:0px">&nbsp;&nbsp;Retained deficit</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=95.667><P style="margin:0px" align=right>(49,923,069)</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=95.667><P style="margin:0px" align=right>(46,795,897)</P>
</TD></TR>
<TR><TD valign=top width=422.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=422.8><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Stockholders&#146; Equity</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=95.667><P style="margin:0px" align=right>5,722,580&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=95.667><P style="margin:0px" align=right>8,208,233&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=422.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=422.8><P style="margin:0px">TOTAL LIABILITIES AND STOCKHOLDERS&#146; EQUITY</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99; border-bottom:2.667px double #000000" valign=bottom width=95.667><P style="margin:0px" align=right>5,954,473&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99; border-bottom:2.667px double #000000" valign=bottom width=95.667><P style="margin:0px" align=right>8,828,759&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=422.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=422.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=422.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=95.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=672 colspan=6><P style="margin:0px" align=center>The accompanying notes are an integral part of these unaudited financial statements.</P>
</TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center><BR>
<BR></P>
<P style="margin:0px" align=center>4</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always" align=center><BR></P>
<P style="margin:0px"><BR></P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=403.667></TD><TD width=24.8></TD><TD width=1.067></TD><TD width=105.933></TD><TD width=25.067></TD><TD width=123.467></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=684 colspan=6><P style="margin:0px" align=center>AMERITYRE CORPORATION</P>
</TD></TR>
<TR><TD valign=top width=684 colspan=6><P style="margin:0px" align=center>Statements of Operations</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=684 colspan=6><P style="margin:0px" align=center>(unaudited)</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.867 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=top width=254.467 colspan=3><P style="margin:0px" align=center>For the Three Months &nbsp;Ended March 31,</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=center>2008</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=123.467><P style="margin:0px" align=center>2007</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">NET REVENUES</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="margin:0px">&nbsp;&nbsp;Products</P>
</TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="margin:0px" align=right>778,862&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=123.467><P style="margin:0px" align=right>648,717&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">&nbsp;&nbsp;Licenses</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>50,000&nbsp;</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=123.467><P style="margin:0px" align=right>75,000&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Net Revenues</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="margin:0px" align=right>828,862&nbsp;</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=123.467><P style="margin:0px" align=right>723,717&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">COST OF REVENUES</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>563,529&nbsp;</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=123.467><P style="margin:0px" align=right>457,269&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">GROSS PROFIT</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>265,333&nbsp;</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=123.467><P style="margin:0px" align=right>266,448&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">EXPENSES</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="margin:0px">&nbsp;Consulting</P>
</TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="margin:0px" align=right>101,510&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=123.467><P style="margin:0px" align=right>150,162&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">&nbsp;Depreciation and amortization</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="margin:0px" align=right>69,482&nbsp;</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=123.467><P style="margin:0px" align=right>92,772&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="margin:0px">&nbsp;Research and development</P>
</TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="margin:0px" align=right>146,811&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=123.467><P style="margin:0px" align=right>173,178&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">&nbsp;Selling, general and administrative</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>1,007,785&nbsp;</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=123.467><P style="margin:0px" align=right>1,363,544&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">&nbsp;&nbsp;&nbsp;Total Expenses</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>1,325,588&nbsp;</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=123.467><P style="margin:0px" align=right>1,779,656&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">LOSS FROM OPERATIONS</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>(1,060,255)</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=123.467><P style="margin:0px" align=right>(1,513,208)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">OTHER INCOME</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="margin:0px">&nbsp;Interest income</P>
</TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="margin:0px" align=right>53,430&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=123.467><P style="margin:0px" align=right>7,164&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">&nbsp;Miscellaneous income</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>1,509&nbsp;</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=123.467><P style="margin:0px" align=right>953&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">&nbsp;&nbsp;&nbsp;Total Other Income</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>54,939&nbsp;</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=123.467><P style="margin:0px" align=right>8,117&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">NET LOSS</P>
</TD><TD valign=top width=24.8><P style="margin:0px" align=right>$</P>
</TD><TD style="border-bottom:2.667px double #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>(1,005,316)</P>
</TD><TD valign=top width=25.067><P style="margin:0px" align=right>$</P>
</TD><TD style="border-bottom:2.667px double #000000" valign=bottom width=123.467><P style="margin:0px" align=right>(1,505,091)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">BASIC AND DILUTED LOSS PER SHARE</P>
</TD><TD valign=top width=24.8><P style="margin:0px" align=right>$</P>
</TD><TD style="border-bottom:2.667px double #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>(0.04)</P>
</TD><TD valign=top width=25.067><P style="margin:0px" align=right>$</P>
</TD><TD style="border-bottom:2.667px double #000000" valign=top width=123.467><P style="margin:0px" align=right>(0.07)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:2.667px double #000000" valign=bottom width=107 colspan=2><P style="margin:0px" align=right>23,426,170&nbsp;</P>
</TD><TD valign=bottom width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:2.667px double #000000" valign=bottom width=123.467><P style="margin:0px" align=right>21,174,010&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=684 colspan=6><P style="margin:0px" align=center>The accompanying notes are an integral part of these unaudited financial statements.</P>
</TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px" align=center>5</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always"><BR></P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=403.667></TD><TD width=24.8></TD><TD width=1.067></TD><TD width=105.933></TD><TD width=25.067></TD><TD width=123.467></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=684 colspan=6><P style="margin:0px" align=center>AMERITYRE CORPORATION</P>
</TD></TR>
<TR><TD valign=top width=684 colspan=6><P style="margin:0px" align=center>Statements of Operations</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=684 colspan=6><P style="margin:0px" align=center>(unaudited)</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.867 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=top width=254.467 colspan=3><P style="margin:0px" align=center>For the Nine Months &nbsp;Ended March 31,</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=center>2008</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=123.467><P style="margin:0px" align=center>2007</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">NET REVENUES</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="margin:0px">&nbsp;&nbsp;Products</P>
</TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="margin:0px" align=right>1,865,711&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=123.467><P style="margin:0px" align=right>1,764,378&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">&nbsp;&nbsp;Licenses</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>160,000&nbsp;</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=123.467><P style="margin:0px" align=right>191,667&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Net Revenues</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="margin:0px" align=right>2,025,711&nbsp;</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=123.467><P style="margin:0px" align=right>1,956,045&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">COST OF REVENUES</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>1,331,832&nbsp;</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=123.467><P style="margin:0px" align=right>1,244,468&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">GROSS PROFIT</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>693,879&nbsp;</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=123.467><P style="margin:0px" align=right>711,577&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">EXPENSES</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="margin:0px">&nbsp;Consulting</P>
</TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="margin:0px" align=right>276,615&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=123.467><P style="margin:0px" align=right>286,274&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">&nbsp;Depreciation and amortization</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="margin:0px" align=right>220,753&nbsp;</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=123.467><P style="margin:0px" align=right>286,756&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="margin:0px">&nbsp;Research and development</P>
</TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="margin:0px" align=right>461,267&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=123.467><P style="margin:0px" align=right>629,655&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">&nbsp;Loss on impairment of assets</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="margin:0px" align=right>462&nbsp;</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=123.467><P style="margin:0px" align=right>3,082&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="margin:0px">&nbsp;Selling, general and administrative</P>
</TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>3,046,168&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=top width=123.467><P style="margin:0px" align=right>3,509,312&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="margin:0px">&nbsp;&nbsp;&nbsp;Total Expenses</P>
</TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>4,005,265&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=123.467><P style="margin:0px" align=right>4,715,079&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="margin:0px">LOSS FROM OPERATIONS</P>
</TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>(3,311,386)</P>
</TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=123.467><P style="margin:0px" align=right>(4,003,502)</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="margin:0px">OTHER INCOME</P>
</TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="margin:0px">&nbsp;Interest income</P>
</TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="margin:0px" align=right>182,126&nbsp;</P>
</TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=123.467><P style="margin:0px" align=right>48,279&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="margin:0px">&nbsp;Miscellaneous income</P>
</TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>2,088&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=123.467><P style="margin:0px" align=right>1,807&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="margin:0px">&nbsp;&nbsp;&nbsp;Total Other Income</P>
</TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>184,214&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=123.467><P style="margin:0px" align=right>50,086&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="margin:0px">NET LOSS</P>
</TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99; border-bottom:2.667px double #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>(3,127,172)</P>
</TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99; border-bottom:2.667px double #000000" valign=bottom width=123.467><P style="margin:0px" align=right>(3,953,416)</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="margin:0px">BASIC AND DILUTED LOSS PER SHARE</P>
</TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99; border-bottom:2.667px double #000000" valign=top width=107 colspan=2><P style="margin:0px" align=right>(0.13)</P>
</TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99; border-bottom:2.667px double #000000" valign=top width=123.467><P style="margin:0px" align=right>(0.19)</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="margin:0px">WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING</P>
</TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:2.667px double #000000" valign=bottom width=107 colspan=2><P style="margin:0px" align=right>23,417,117&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:2.667px double #000000" valign=bottom width=123.467><P style="margin:0px" align=right>21,076,205&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=403.667><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=24.8><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=107 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=25.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=123.467><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=684 colspan=6><P style="margin:0px" align=center>The accompanying notes are an integral part of these unaudited financial statements.</P>
</TD></TR>
</TABLE>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px" align=center>6</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always"><BR></P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=425.933></TD><TD width=21.067></TD><TD width=106.933></TD><TD width=21.067></TD><TD width=110></TD><TD width=1></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=686 colspan=6><P style="margin:0px" align=center>AMERITYRE CORPORATION</P>
</TD></TR>
<TR><TD valign=bottom width=686 colspan=6><P style="margin:0px" align=center>Statements of Cash Flows</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=686 colspan=6><P style="margin:0px" align=center>(unaudited)</P>
</TD></TR>
<TR><TD valign=bottom width=425.933><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=239 colspan=4><P style="margin:0px" align=center>For the Nine Months Ended</P>
<P style="margin:0px" align=center>&nbsp;March 31,</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=106.933><P style="margin:0px" align=center>2008</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=111 colspan=2><P style="margin:0px" align=center>2007</P>
</TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">CASH FLOWS FROM OPERATING ACTIVITIES</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=106.933><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=111 colspan=2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="margin:0px">Net loss</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.933><P style="margin:0px" align=right>(3,127,172)</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>(3,953,416)</P>
</TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">Adjustments to reconcile net loss to net cash used by operating activities:</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=106.933><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=111 colspan=2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="margin:0px">&nbsp;Depreciation &amp; amortization expense</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.933><P style="margin:0px" align=right>220,753&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>286,756&nbsp;</P>
</TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">&nbsp;Bad debt recovery</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=106.933><P style="margin:0px" align=right>(8,086)</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=111 colspan=2><P style="margin:0px" align=right>-&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="margin:0px">&nbsp;Loss on impairment of assets</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.933><P style="margin:0px" align=right>462&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>3,082&nbsp;</P>
</TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">&nbsp;Common stock issued/accrued &nbsp;for services</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=106.933><P style="margin:0px" align=right>130,595&nbsp;</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=111 colspan=2><P style="margin:0px" align=right>-&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="margin:0px">&nbsp;Stock options for services</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.933><P style="margin:0px" align=right>73,732&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>131,850&nbsp;</P>
</TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">&nbsp;Stock-based compensation expense related to employee options</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=106.933><P style="margin:0px" align=right>265,400&nbsp;</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=111 colspan=2><P style="margin:0px" align=right>576,195&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="margin:0px">&nbsp;Stock redemption for note receivable</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.933><P style="margin:0px" align=right>(29,873)</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>-&nbsp;</P>
</TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">&nbsp;Amortization of expense prepaid w/ common stock</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=106.933><P style="margin:0px" align=right>51,665&nbsp;</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=111 colspan=2><P style="margin:0px" align=right>49,167&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="margin:0px">Changes in operating assets and liabilities:</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.933><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=111 colspan=2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">&nbsp;(Increase) in accounts receivable</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=106.933><P style="margin:0px" align=right>(112,654)</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=111 colspan=2><P style="margin:0px" align=right>(32,866)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="margin:0px">&nbsp;(Increase) Decrease in prepaid expenses</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.933><P style="margin:0px" align=right>(133,410)</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>71,904&nbsp;</P>
</TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">&nbsp;(Increase) in other assets</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=106.933><P style="margin:0px" align=right>(110,424)</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=111 colspan=2><P style="margin:0px" align=right>(134,494)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="margin:0px">&nbsp;Decrease &nbsp;(Increase) in inventory</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.933><P style="margin:0px" align=right>12,456&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>(123&nbsp;,842)</P>
</TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">&nbsp;(Decrease) Increase in accounts payable and accrued expenses</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=106.933><P style="margin:0px" align=right>(238,632)</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>447,907&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="margin:0px">&nbsp;&nbsp;&nbsp;Net Cash Used by Operating Activities</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=106.933><P style="margin:0px" align=right>(3,005,188)</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>(2,677,757)</P>
</TD></TR>
<TR><TD valign=bottom width=425.933><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=106.933><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=111 colspan=2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="margin:0px">CASH FLOWS FROM INVESTING ACTIVITIES</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.933><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=111 colspan=2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">Cash paid for patents and trademarks</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=106.933><P style="margin:0px" align=right>(67,072)</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=111 colspan=2><P style="margin:0px" align=right>(128,086)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="margin:0px">Proceeds from the sale of property and equipment</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.933><P style="margin:0px" align=right>744&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>-&nbsp;</P>
</TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">Purchase of property and equipment</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=106.933><P style="margin:0px" align=right>(50,383)</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>(156,637)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="margin:0px">&nbsp;&nbsp;&nbsp;Net Cash Used by Investing Activities</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=106.933><P style="margin:0px" align=right>(116,711)</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>(284,723)</P>
</TD></TR>
<TR><TD valign=bottom width=425.933><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=106.933><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=111 colspan=2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="margin:0px">CASH FLOWS FROM FINANCING ACTIVITIES</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.933><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=111 colspan=2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">Proceeds from stock subscription</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=106.933><P style="margin:0px" align=right>-&nbsp;</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=111 colspan=2><P style="margin:0px" align=right>1,392,710&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="margin:0px">Proceeds from the sale of common stock</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.933><P style="margin:0px" align=right>-&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>2,018,800&nbsp;</P>
</TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">Stock offering costs</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=106.933><P style="margin:0px" align=right>-&nbsp;</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=111 colspan=2><P style="margin:0px" align=right>(185,296)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="margin:0px">Proceeds from the exercise of warrants/stock options</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=106.933><P style="margin:0px" align=right>-&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>9,188&nbsp;</P>
</TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">&nbsp;&nbsp;&nbsp;Net Cash Provided by Financing Activities</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=106.933><P style="margin:0px" align=right>-&nbsp;</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>3,235,402&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.933><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=111 colspan=2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">NET DECREASE IN CASH AND CASH EQUIVALENTS</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=106.933><P style="margin:0px" align=right>(3,121,899)</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=111 colspan=2><P style="margin:0px" align=right>272,922&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.933><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=111 colspan=2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=106.933><P style="margin:0px" align=right>5,788,602&nbsp;</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>3,065,675&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.933><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=111 colspan=2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=425.933><P style="margin:0px">CASH AND CASH EQUIVALENTS AT END OF PERIOD</P>
</TD><TD valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD style="border-bottom:2.667px double #000000" valign=bottom width=106.933><P style="margin:0px" align=right>2,666,703&nbsp;</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD style="border-bottom:2.667px double #000000" valign=bottom width=111 colspan=2><P style="margin:0px" align=right>3,338,597&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=425.933><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.933><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=111 colspan=2><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=686 colspan=6><P style="margin:0px" align=center>The accompanying notes are an integral part of these unaudited financial statements.</P>
</TD></TR>
</TABLE>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px" align=center>7</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always"><BR></P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=439.267></TD><TD width=21.067></TD><TD width=112></TD><TD width=21.067></TD><TD width=113.4></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=706.8 colspan=5><P style="margin:0px" align=center>AMERITYRE CORPORATION</P>
</TD></TR>
<TR><TD valign=bottom width=706.8 colspan=5><P style="margin:0px" align=center>Statements of Cash Flows (Continued)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=706.8 colspan=5><P style="margin:0px" align=center>(unaudited)</P>
</TD></TR>
<TR><TD valign=bottom width=439.267><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=246.467 colspan=3><P style="margin:0px" align=center>For the Nine Months Ended</P>
<P style="margin:0px" align=center>&nbsp;March 31,</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=439.267><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=112><P style="margin:0px" align=center>2008</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=113.4><P style="margin:0px" align=center>2007</P>
</TD></TR>
<TR><TD valign=bottom width=439.267><P style="margin:0px">SUPPLEMENTAL SCHEDULE OF CASH FLOW ACTIVITIES</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=112><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=113.4><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=439.267><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=112><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=113.4><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=439.267><P style="margin:0px">CASH PAID FOR:</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=112><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=113.4><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=439.267><P style="margin:0px">Interest</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=112><P style="margin:0px" align=right>&nbsp;&nbsp;&nbsp;&nbsp;- </P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=113.4><P style="margin:0px" align=right>&nbsp;&nbsp;&nbsp;&nbsp;- </P>
</TD></TR>
<TR><TD valign=bottom width=439.267><P style="margin:0px">Income taxes</P>
</TD><TD valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD valign=bottom width=112><P style="margin:0px" align=right>&nbsp;&nbsp;&nbsp;&nbsp;- </P>
</TD><TD valign=bottom width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD valign=bottom width=113.4><P style="margin:0px" align=right>&nbsp;&nbsp;&nbsp;&nbsp;- </P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=439.267><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=112><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=113.4><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=439.267><P style="margin:0px">NON-CASH OPERATING ACTIVITIES</P>
</TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=112><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=113.4><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=439.267><P style="margin:0px">Common stock issued for services rendered</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=112><P style="margin:0px" align=right>130,595</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=113.4><P style="margin:0px" align=right>&nbsp;&nbsp;&nbsp;&nbsp;131,850</P>
</TD></TR>
<TR><TD valign=bottom width=439.267><P style="margin:0px">Stock-based compensation expense related to employee options</P>
</TD><TD valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD valign=bottom width=112><P style="margin:0px" align=right>265,400</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD valign=bottom width=113.4><P style="margin:0px" align=right>576,195</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=439.267><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=112><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=113.4><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=439.267><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=112><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=113.4><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=706.8 colspan=5><P style="margin:0px" align=center>The accompanying notes are an integral part of these unaudited financial statements.</P>
</TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center><BR>
<BR></P>
<P style="margin:0px" align=center>8</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always" align=center>AMERITYRE CORPORATION</P>
<P style="margin:0px" align=center>Notes to the Unaudited Financial Statements</P>
<P style="margin:0px" align=center>March 31, 2008 and June 30, 2007</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">NOTE 1 - BASIS OF FINANCIAL STATEMENT PRESENTATION</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">The accompanying unaudited condensed financial statements have been prepared by us pursuant to the rules and regulations of the Securities and Exchange Commission. &nbsp;Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted in accordance with such rules and regulations. &nbsp;The information furnished in the interim condensed financial statements includes normal recurring adjustments and reflects all adjustments, which, in the opinion of management, are necessary for a fair presentation of such financial statements. &nbsp;Although we believe the disclosures and information presented are adequate to make the information not misleading. These interim condensed financial statements should be read in conjunction with our most recent audited financial statements and notes thereto included in our June 30, 2007 Annual Report on Form 10-K. &nbsp;Operating results for the three and nine months ended March 31, 2008 are not necessarily indicative of the results that may be expected for the current fiscal year ending June 30, 2008.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><I>Stock Based-Compensation Expense</I></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">On July 1, 2005, we adopted Statement of Financial Accounting Standards No. 123 (revised 2004), &#147;Share-Based Payment,&#148; (&#147;SFAS 123(R)&#148;) which requires the measurement and recognition of compensation expense for all share-based payments to employees and directors including employee stock options &nbsp;and stock purchases related to the Company&#146;s employee stock option and award plans based on estimated fair values. SFAS 123(R) supersedes our previous accounting under Accounting Principles Board Option No. 25, &#147;Accounting for Stock Issued to Employees&#148; (&#147;APB25&#148;) for periods beginning in fiscal 2006. In March 2005, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 107 (&#147;SAB 107&#148;) relating to SFAS 123(R). We have applied the provisions of SAB 107 in our adoption of SFAS 123(R). </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">We adopted SFAS 123(R) using the modified prospective transition method, which requires the application of the accounting standard as of July 1, 2005, the first day of our fiscal year 2006. Our financial statements as of and for the three and nine month periods ended March 31, 2008 and 2007 reflect the impact of SFAS 123(R). &nbsp;Stock-based compensation expense recognized under SFAS 123(R) for the nine month periods ended March 31, 2008 and 2007 was $265,400 and $576,195, respectively, related to employee stock options issued during the respective periods. </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">SFAS 123(R) requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in our Statement of Operations. Stock-based compensation expense recognized in our Statements of Operations for the three and nine month periods ended March 31, 2008 and 2007 assumes all awards will vest, therefore no reduction has been made for estimated forfeitures.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><I>Basic and Fully Diluted Net Loss Per Share</I></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">Basic and Fully Diluted net loss per share is computed using the weighted-average number of common shares outstanding during the period.</P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=229.2></TD><TD width=15.733></TD><TD width=114.867></TD><TD width=15.733></TD><TD width=112.267></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=229.2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=258.6 colspan=4><P style="margin:0px" align=center>For the Nine Months Ended</P>
</TD></TR>
<TR><TD valign=top width=229.2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=130.6 colspan=2><P style="margin:0px" align=center><U>March 31, 2008</U></P>
</TD><TD valign=top width=128 colspan=2><P style="margin:0px" align=center><U>March 31, 2007</U></P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=229.2><P style="margin:0px">Loss (numerator)</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=top width=114.867><P style="margin:0px" align=right>(3,127,172)</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=top width=112.267><P style="margin:0px" align=right>(3,953,416)</P>
</TD></TR>
<TR><TD valign=top width=229.2><P style="margin:0px">Shares (denominator)</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=114.867><P style="margin:0px" align=right>23,417,117&nbsp;</P>
</TD><TD valign=top width=15.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=112.267><P style="margin:0px" align=right>21,076,205&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=229.2><P style="margin:0px">Per share amount</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99; border-bottom:2.667px double #000000" valign=top width=114.867><P style="margin:0px" align=right>(0.13)</P>
</TD><TD style="background-color:#FFFF99" valign=top width=15.733><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99; border-bottom:2.667px double #000000" valign=top width=112.267><P style="margin:0px" align=right>&nbsp;(0.19)</P>
</TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px">Our outstanding stock options have been excluded from the basic and fully diluted net loss per share calculation. We excluded 3,985,000 and 4,115,000 common stock equivalents for the nine month periods ended March 31, 2008 and 2007, respectively, because they are anti-dilutive.</P>
<P style="margin:0px" align=center><BR>
<BR></P>
<P style="margin:0px" align=center>9</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always" align=center>AMERITYRE CORPORATION</P>
<P style="margin:0px" align=center>Notes to the Unaudited Financial Statements</P>
<P style="margin:0px" align=center>March 31, 2008 and June 30, 2007</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">NOTE 2 &#150; SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><I>Liquidity</I></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">Our financial statements are prepared using generally accepted accounting principles applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. We have historically incurred significant losses which have resulted in a total retained deficit of $49,923,069 at March 31, 2008. &nbsp;Although for the fiscal years ended June 30, 2005, 2006 and 2007, we have losses from operations and have used cash in our operating activities in excess of our revenues, we have had little, if any, debt and have consistently had a positive net tangible book value. In connection with the preparation of our financial statements we have analyzed our cash needs for fiscal 2008. Based on this analysis, we concluded that our available cash would be sufficient to meet our current working capital, capital expenditure and other cash requirements for fiscal 2008, and a substantial portion of fiscal 2009. However in the event of a cash shortfall we believe we would need additional capital. &nbsp;At March 31, 2008, we had approximately $2.67 million available to finance our operations. In an effort to increase revenues, we have recently expanded our product lines&nbsp;and begun the sale of&nbsp;polyurethane foam tire fill and solid polyurethane elastomer tires. Although we believe that we will successfully implement our business plan to provide for additional&nbsp;revenues to offset operating costs, management cannot give any assurances that it will be able to do so or that we will ever operate profitably.&nbsp; Our business plan assumes, among other things, that&nbsp;our revenues will increase from the sale of the new product lines, our material cost will remain constant or decrease, our expense from operations will continue at a rate similar to the rate we experienced for&nbsp;nine month period ended&nbsp;March&nbsp;31, 2008,&nbsp;and that we will&nbsp;increase&nbsp;our product pricing.&nbsp;&nbsp;&nbsp;Until such time as our net income exceeds our expense from operation,&nbsp;it is possible that we may need additional capital.&nbsp;If necessary, we may seek to raise additional capital through the issuance of debt or equity securities. Our ability to obtain financing through the offer and sale of our securities is subject to market conditions and other factors beyond our control. We cannot assure you that we will be able to obtain financing on favorable terms or at all. </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><I>Income Tax</I></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:6.667px">We file federal income tax returns in the U.S. and state income tax returns in those state jurisdictions where we are required to file<I>.</I> &nbsp;With few exceptions, we are no longer subject to U.S. federal, state or and local income tax examinations by tax authorities for years before June 30, 2004.</P>
<P style="margin:0px">We adopted the provisions of FASB Interpretation No. 48, <I>Accounting for Uncertainty in Income Taxes</I>, on July 1, 2007, the first day of our current fiscal year. &nbsp;As a result of the implementation of Interpretation 48, no adjustment should be made for unrecognized tax benefits. </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:6.667px">There are no tax positions included in the balance at March 31, 2008 for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility. &nbsp;Because of the impact of deferred tax accounting, other than interest and penalties, the disallowance of the shorter deductibility period would not affect the annual effective tax rate but would accelerate the payment of cash to the taxing authority to an earlier period.</P>
<P style="margin:0px">Our policy is to recognize accrued interest related to unrecognized tax benefits in interest expense and penalties in operating expenses. &nbsp;</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">NOTE 3 - STOCK OPTIONS AND WARRANTS </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><I>General Option Information</I></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">During the nine month period ended March 31, 2008, we granted options to acquire an aggregate of 250,000 shares of our common stock to certain employees and consultants in connection with their employment (the &#147;Employment Options&#148;). The Employment Options granted during the nine month period ended March 31, 2008 vest annually over a period of one to two years based on the employee&#146;s continued employment. The exercise price for the Employment Options granted during the period was $4.04 per share. &nbsp;During the nine month period ended March 31, 2007, we did not grant any options. We use the Black-Scholes model to value stock options. The Black-Scholes model requires the use of employee exercise behavior data and the use of a number of assumptions, including volatility of our stock </P>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px" align=center>10</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always" align=center>AMERITYRE CORPORATION</P>
<P style="margin:0px" align=center>Notes to the Unaudited Financial Statements</P>
<P style="margin:0px" align=center>March 31, 2008 and June 30, 2007</P>
<P style="margin:0px" align=center><BR></P>
<P style="margin:0px">NOTE 3 - STOCK OPTIONS AND WARRANTS (Continued) </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">price, the weighted average risk-free interest rate, and the weighted average expected life of the options. Because we do not pay dividends, the dividend rate variable in the Black-Scholes model is zero. We estimated the fair value of the stock options at the grant date based on the following weighted average assumptions: </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=139.2></TD><TD width=129></TD><TD width=18.133></TD><TD width=128.867></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=139.2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=top width=129><P style="margin:0px" align=center>For the nine month period ended</P>
<P style="margin:0px" align=center>March 31, 2008</P>
</TD><TD style="background-color:#FFFF99" valign=top width=18.133><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=top width=128.867><P style="margin:0px" align=center>For the nine month period ended</P>
<P style="margin:0px" align=center>March 31, 2007</P>
</TD></TR>
<TR><TD valign=top width=139.2><P style="margin:0px">Risk free interest rate</P>
</TD><TD valign=top width=129><P style="margin:0px" align=center>4.64%</P>
</TD><TD valign=top width=18.133><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=128.867><P style="margin:0px" align=center>N/A</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=139.2><P style="margin:0px">Expected life</P>
</TD><TD style="background-color:#FFFF99" valign=top width=129><P style="margin:0px" align=center>5 years</P>
</TD><TD style="background-color:#FFFF99" valign=top width=18.133><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=128.867><P style="margin:0px" align=center>N/A</P>
</TD></TR>
<TR><TD valign=top width=139.2><P style="margin:0px">Expected volatility</P>
</TD><TD valign=top width=129><P style="margin:0px" align=center>55%</P>
</TD><TD valign=top width=18.133><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=128.867><P style="margin:0px" align=center>N/A</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=139.2><P style="margin:0px">Dividend yield</P>
</TD><TD style="background-color:#FFFF99" valign=top width=129><P style="margin:0px" align=center>0%</P>
</TD><TD style="background-color:#FFFF99" valign=top width=18.133><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=128.867><P style="margin:0px" align=center>N/A</P>
</TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px">A summary of the status of our outstanding stock options as of March 31, 2008 and June 30, 2007 and changes during the periods then ended is presented below: &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
<P style="margin:0px"><BR></P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=205.2></TD><TD width=96></TD><TD width=93></TD><TD width=39></TD><TD width=96></TD><TD width=65></TD><TD width=50.2></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=205.2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=top width=228 colspan=3><P style="margin:0px" align=center>March 31, 2008</P>
</TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=top width=211.2 colspan=3><P style="margin:0px" align=center>June 30, 2007</P>
</TD></TR>
<TR><TD valign=top width=205.2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=96><P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=center><U>Shares</U></P>
</TD><TD valign=top width=132 colspan=2><P style="margin:0px" align=center>Weighted Average <U>Exercise Price</U></P>
</TD><TD valign=top width=96><P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=center><U>Shares</U></P>
</TD><TD valign=top width=115.2 colspan=2><P style="margin:0px" align=center>Weighted Average <U>Exercise Price</U></P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=205.2><P style="margin:0px">Outstanding beginning of period</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=96><P style="margin:0px" align=right>3,915,000&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=93><P style="margin:0px" align=right>&nbsp;$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=39><P style="margin:0px" align=right>6.81</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=96><P style="margin:0px" align=right>4,190,000&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=65><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=50.2><P style="margin:0px" align=right>6.69&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=205.2><P style="margin:0px">Granted</P>
</TD><TD valign=bottom width=96><P style="margin:0px" align=right>250,000&nbsp;</P>
</TD><TD valign=bottom width=93><P style="margin:0px" align=right>$</P>
</TD><TD valign=bottom width=39><P style="margin:0px" align=right>4.04</P>
</TD><TD valign=bottom width=96><P style="margin:0px" align=right>55,000&nbsp;</P>
</TD><TD valign=bottom width=65><P style="margin:0px" align=right>$</P>
</TD><TD valign=bottom width=50.2><P style="margin:0px" align=right>3.96&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=205.2><P style="margin:0px">Expired/Cancelled</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=96><P style="margin:0px" align=right>(180,000)</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=93><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=39><P style="margin:0px" align=right>6.51</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=96><P style="margin:0px" align=right>(118,447)</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=65><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=50.2><P style="margin:0px" align=right>(6.16)</P>
</TD></TR>
<TR><TD valign=top width=205.2><P style="margin:0px">Exercised</P>
</TD><TD valign=bottom width=96><P style="margin:0px" align=right><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;</U></P>
</TD><TD valign=bottom width=93><P style="margin:0px" align=right>$</P>
</TD><TD valign=bottom width=39><P style="margin:0px" align=right>- </P>
</TD><TD valign=bottom width=96><P style="margin:0px" align=right><U>&nbsp;&nbsp;&nbsp;(211,553)</U></P>
</TD><TD valign=bottom width=65><P style="margin:0px" align=right>$</P>
</TD><TD valign=bottom width=50.2><P style="margin:0px" align=right>(3.99)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=205.2><P style="margin:0px">Outstanding end of period</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=96><P style="margin:0px" align=right><B><U>&nbsp;3,985,000&nbsp;</U></B></P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=93><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=39><P style="margin:0px" align=right>6.65</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=96><P style="margin:0px" align=right><B><U>&nbsp;3,915,000&nbsp;</U></B></P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=65><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=50.2><P style="margin:0px" align=right>6.81&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=205.2><P style="margin:0px">Exercisable</P>
</TD><TD valign=bottom width=96><P style="margin:0px" align=right><B><U>&nbsp;3,635,000&nbsp;</U></B></P>
</TD><TD valign=bottom width=93><P style="margin:0px" align=right>$</P>
</TD><TD valign=bottom width=39><P style="margin:0px" align=right>6.85</P>
</TD><TD valign=bottom width=96><P style="margin:0px" align=right><B><U>&nbsp;3,715,000&nbsp;</U></B></P>
</TD><TD valign=bottom width=65><P style="margin:0px" align=right>$</P>
</TD><TD valign=bottom width=50.2><P style="margin:0px" align=right>6.84&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=205.2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=96><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=132 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=96><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=115.2 colspan=2><P style="font-size:2pt">&nbsp;</P></TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px">The following table summarizes the range of outstanding and exercisable options as of March 31, 2008:</P>
<P style="margin:0px"><BR></P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=85.2></TD><TD width=127.6></TD><TD width=106.4></TD><TD width=106.4></TD><TD width=106.4></TD><TD width=106.4></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=85.2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=340.4 colspan=3><P style="margin:0px" align=center><U>Outstanding</U></P>
</TD><TD style="background-color:#FFFF99" valign=top width=212.8 colspan=2><P style="margin:0px" align=center><U>Exercisable</U></P>
</TD></TR>
<TR><TD valign=top width=85.2><P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=center>Range of</P>
<P style="margin:0px" align=center>Exercise <U>Prices</U></P>
</TD><TD valign=top width=127.6><P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=center>Number Outstanding at</P>
<P style="margin:0px" align=center><U>Mar. 31, 2008</U></P>
</TD><TD valign=top width=106.4><P style="margin:0px" align=center>Weighted</P>
<P style="margin:0px" align=center>Average</P>
<P style="margin:0px" align=center>Remaining</P>
<P style="margin:0px" align=center><U>Contractual Life</U></P>
</TD><TD valign=top width=106.4><P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=center>Weighted</P>
<P style="margin:0px" align=center>Average</P>
<P style="margin:0px" align=center><U>Exercise Price</U></P>
</TD><TD valign=top width=106.4><P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=center>Number</P>
<P style="margin:0px" align=center>Exercisable at</P>
<P style="margin:0px" align=center><U>Mar. 31, 2008</U></P>
</TD><TD valign=top width=106.4><P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=center>Weighted</P>
<P style="margin:0px" align=center>Average</P>
<P style="margin:0px" align=center><U>Exercise Price</U></P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=85.2><P style="margin:0px" align=right>$3.55</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=127.6><P style="margin:0px" align=right>25,000</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="margin:0px" align=right>1.79</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="margin:0px" align=right>$3.55</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="margin:0px" align=right>25,000</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="margin:0px" align=right>$3.55</P>
</TD></TR>
<TR><TD valign=bottom width=85.2><P style="margin:0px" align=right>$4.04</P>
</TD><TD valign=bottom width=127.6><P style="margin:0px" align=right>250,000</P>
</TD><TD valign=bottom width=106.4><P style="margin:0px" align=right>4.37</P>
</TD><TD valign=bottom width=106.4><P style="margin:0px" align=right>$4.04</P>
</TD><TD valign=bottom width=106.4><P style="margin:0px" align=right>0</P>
</TD><TD valign=bottom width=106.4><P style="margin:0px" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=85.2><P style="margin:0px" align=right>$4.31</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=127.6><P style="margin:0px" align=right>30,000</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="margin:0px" align=right>1.93</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="margin:0px" align=right>$4.31</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="margin:0px" align=right>30,000</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="margin:0px" align=right>$4.31</P>
</TD></TR>
<TR><TD valign=bottom width=85.2><P style="margin:0px" align=right>$5.36</P>
</TD><TD valign=bottom width=127.6><P style="margin:0px" align=right>150,000</P>
</TD><TD valign=bottom width=106.4><P style="margin:0px" align=right>2.25</P>
</TD><TD valign=bottom width=106.4><P style="margin:0px" align=right>$5.36</P>
</TD><TD valign=bottom width=106.4><P style="margin:0px" align=right>100,000</P>
</TD><TD valign=bottom width=106.4><P style="margin:0px" align=right>$5.36</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=85.2><P style="margin:0px" align=right>$6.40</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=127.6><P style="margin:0px" align=right>105,000</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="margin:0px" align=right>1.71</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="margin:0px" align=right>$6.40</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="margin:0px" align=right>105,000</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="margin:0px" align=right>$6.40</P>
</TD></TR>
<TR><TD valign=bottom width=85.2><P style="margin:0px" align=right>$6.60</P>
</TD><TD valign=bottom width=127.6><P style="margin:0px" align=right>425,000</P>
</TD><TD valign=bottom width=106.4><P style="margin:0px" align=right>2.25</P>
</TD><TD valign=bottom width=106.4><P style="margin:0px" align=right>$6.60</P>
</TD><TD valign=bottom width=106.4><P style="margin:0px" align=right>375,000</P>
</TD><TD valign=bottom width=106.4><P style="margin:0px" align=right>$6.60</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=85.2><P style="margin:0px" align=right>$7.00</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=127.6><P style="margin:0px" align=right><U>&nbsp;3,000,000</U></P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="margin:0px" align=right>1.45</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="margin:0px" align=right>$7.00</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="margin:0px" align=right><U>&nbsp;3,000,000</U></P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="margin:0px" align=right>$7.00</P>
</TD></TR>
<TR><TD valign=bottom width=85.2><P style="margin:0px" align=right>$3.55-$7.00</P>
</TD><TD valign=bottom width=127.6><P style="margin:0px" align=right><B><U>&nbsp;3,985,000</U></B></P>
</TD><TD valign=bottom width=106.4><P style="margin:0px" align=right>1.76</P>
</TD><TD valign=bottom width=106.4><P style="margin:0px" align=right>$6.65</P>
</TD><TD valign=bottom width=106.4><P style="margin:0px" align=right><B><U>&nbsp;3,635,000</U></B></P>
</TD><TD valign=bottom width=106.4><P style="margin:0px" align=right>$6.85</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=85.2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=127.6><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=106.4><P style="font-size:2pt">&nbsp;</P></TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px">As of March 31, 2008, the unrecognized stock-based compensation related to stock options was approximately $440,232. This cost is expected to be expensed over a period of 1.25 years.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center><BR>
<BR></P>
<P style="margin:0px" align=center>11</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always" align=center>AMERITYRE CORPORATION</P>
<P style="margin:0px" align=center>Notes to the Unaudited Financial Statements</P>
<P style="margin:0px" align=center>March 31, 2008 and June 30, 2007</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">NOTE 3 - STOCK OPTIONS AND WARRANTS (Continued)</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><I>General Warrant Information</I></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">The following table summarizes outstanding warrants to purchase our common stock at March 31, 2008.</P>
<P style="margin:0px"><BR></P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=153.267></TD><TD width=166.933></TD><TD width=147.333></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=153.267><P style="margin:0px" align=center>Number of Warrants</P>
<P style="margin:0px" align=center>Outstanding at</P>
<P style="margin:0px" align=center><U>March 31, 2008</U></P>
</TD><TD style="background-color:#FFFF99" valign=top width=166.933><P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=center><U>Expiration Date</U></P>
</TD><TD style="background-color:#FFFF99" valign=top width=147.333><P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=center><U>Exercise Price</U></P>
</TD></TR>
<TR><TD valign=bottom width=153.267><P style="margin:0px" align=center>102,825</P>
</TD><TD valign=bottom width=166.933><P style="margin:0px" align=center>1/31/2009</P>
</TD><TD valign=bottom width=147.333><P style="margin:0px" align=center>$5.00</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=153.267><P style="margin:0px" align=center>103,825</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=166.933><P style="margin:0px" align=center>1/31/2011</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=147.333><P style="margin:0px" align=center>$5.50</P>
</TD></TR>
<TR><TD valign=bottom width=153.267><P style="margin:0px" align=center>510,720</P>
</TD><TD valign=bottom width=166.933><P style="margin:0px" align=center>3/11/2009 to 3/20/2009</P>
</TD><TD valign=bottom width=147.333><P style="margin:0px" align=center>$4.50</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=153.267><P style="margin:0px" align=center><U>550,000</U></P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=166.933><P style="margin:0px" align=center>4/30/2009</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=147.333><P style="margin:0px" align=center>$4.50</P>
</TD></TR>
<TR><TD valign=bottom width=153.267><P style="margin:0px; font-family:Times" align=center><FONT FACE="Times"><U>1,267,370</U></FONT></P>
</TD><TD valign=bottom width=166.933><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=147.333><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=153.267><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=166.933><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=147.333><P style="font-size:2pt">&nbsp;</P></TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><FONT FACE="Times New Roman">NOTE 4 - STOCK ISSUANCES</FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">In January 2008 we approved the issuance of 20,000 shares of our restricted common stock to our chief chemical system formulator Juan Manuel Chacon a stock award for his services. The shares were valued at $44,600 or $2.23 per share.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">NOTE 5 - INVENTORY</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">Inventory is stated at the lower of cost (computed on a first-in, first-out basis) or market. &nbsp;The inventory consists of chemicals, finished goods produced in our plant and products purchased for resale.</P>
<P style="margin:0px"><BR></P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=107.733></TD><TD width=21.067></TD><TD width=103.467></TD><TD width=21.067></TD><TD width=94.333></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=107.733><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=top width=124.533 colspan=2><P style="margin:0px" align=center><U>March 31, 2008</U></P>
<P style="margin:0px" align=center>(Unaudited)</P>
</TD><TD style="background-color:#FFFF99" valign=top width=115.4 colspan=2><P style="margin:0px" align=center><U>June 30, 2007</U></P>
</TD></TR>
<TR><TD valign=top width=107.733><P style="margin:0px">Raw Materials</P>
</TD><TD valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD valign=top width=103.467><P style="margin:0px" align=right>236,613</P>
</TD><TD valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD valign=top width=94.333><P style="margin:0px" align=right>204,665</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=107.733><P style="margin:0px">Work in Progress</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=top width=103.467><P style="margin:0px" align=right>-</P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=top width=94.333><P style="margin:0px" align=right>-</P>
</TD></TR>
<TR><TD valign=top width=107.733><P style="margin:0px">Finished Goods</P>
</TD><TD valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD valign=top width=103.467><P style="margin:0px" align=right><U>490,641</U></P>
</TD><TD valign=top width=21.067><P style="margin:0px" align=right>$</P>
</TD><TD valign=top width=94.333><P style="margin:0px" align=right><U>535,045</U></P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=107.733><P style="margin:0px"><B>Total Inventory</B></P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="margin:0px" align=right><B>$</B></P>
</TD><TD style="background-color:#FFFF99" valign=top width=103.467><P style="margin:0px; font-family:Times" align=right><FONT FACE="Times"><B><U>727,254</U></B></FONT></P>
</TD><TD style="background-color:#FFFF99" valign=top width=21.067><P style="margin:0px" align=right><FONT FACE="Times New Roman"><B>$</B></FONT></P>
</TD><TD style="background-color:#FFFF99" valign=top width=94.333><P style="margin:0px; font-family:Times" align=right><FONT FACE="Times"><B><U>739,710</U></B></FONT></P>
</TD></TR>
<TR><TD valign=top width=107.733><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=124.533 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=top width=115.4 colspan=2><P style="font-size:2pt">&nbsp;</P></TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center><BR>
<BR></P>
<P style="margin:0px" align=center><FONT FACE="Times New Roman">12</FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always" align=center>AMERITYRE CORPORATION</P>
<P style="margin:0px" align=center>Notes to the Unaudited Financial Statements</P>
<P style="margin:0px" align=center>March 31, 2008 and June 30, 2007</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">NOTE 6 &#150; LICENSE FEES</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">The table below sets forth the contractual aggregate license revenue from manufacturing licenses granted by us to licensees during the nine month period ended March 31, 2008.</P>
<P style="margin:0px"><BR></P>
<TABLE style="font-size:13.333px" cellspacing=0><TR><TD width=125.333></TD><TD width=21.067></TD><TD width=79.067></TD><TD width=21.067></TD><TD width=51.933></TD><TD width=21.067></TD><TD width=51.6></TD><TD width=21.067></TD><TD width=51.6></TD><TD width=21.067></TD><TD width=55.8></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=125.333><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=79.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1.333px solid #000000" valign=bottom width=274.133 colspan=7><P style="margin:0px" align=center>Fiscal Year 2008</P>
</TD></TR>
<TR><TD valign=bottom width=125.333><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1.333px solid #000000" valign=bottom width=79.067><P style="margin:0px" align=center>Total</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1.333px solid #000000" valign=bottom width=51.933><P style="margin:0px" align=center>Sept. 30, 2007</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1.333px solid #000000" valign=bottom width=51.6><P style="margin:0px" align=center>Dec. 31, 2007</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1.333px solid #000000" valign=bottom width=51.6><P style="margin:0px" align=center>Mar. 31, 2008</P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1.333px solid #000000" valign=bottom width=55.8><P style="margin:0px" align=center>Jun. 30, 2008</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=125.333><P style="margin:0px; text-indent:13.333px">License Fees <SUP>(1)</SUP></P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=79.067><P style="margin:0px" align=right>10,000</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=51.933><P style="margin:0px" align=right>&nbsp;&nbsp;&nbsp;&nbsp;-</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=51.6><P style="margin:0px" align=right>10,000</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=51.6><P style="margin:0px" align=right>&nbsp;&nbsp;-</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=55.8><P style="margin:0px" align=right>-</P>
</TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="line-height:13.333px; margin:0px; font-size:10.667px">(1) The License Agreement with Desert Research Technology, Inc. provides for a one-time payment of $10,000 on or before October 31, 2007 and the payment of a royalty fee based on the products produced and shipped. &nbsp;The royalty fee, if any, shall be paid in arrears on a quarterly basis beginning January 1, 2008. </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">License fees recorded during the nine months ended March 31, 2008 include $150,001 in fees owed to us by our Chinese licensee that are currently in arrears. Our Chinese licensee has made quarterly installment payments aggregating $150,000 under a two year license agreement executed in August 2006. &nbsp;The licensee is required to pay us a total of $400,000 under the license agreement. We anticipate that the license fees currently due and the balance of the quarterly installment payments will be paid in full by August 2008.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">NOTE 7 &#150; LEASE </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">In November 2007, we negotiated an extension of our current lease for the building and related real property located at 1501 Industrial Road, Boulder City, Nevada to provide for a five year term expiring November 14, 2012, with a base monthly rent of $24,600 subject to annual adjustments based on the consumer price index . </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">NOTE 8 &#150; SUBSEQUENT EVENT </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">Effective April 2, 2008, we hired Michael Kapral as our Vice President of Marketing. In connection with Mr. Kapral&#146;s employment, we have entered into an employment agreement that includes a base salary of $150,000 per year, with a potential cash performance bonus of up to 50% of his base salary based on the Company meeting or exceeding certain financial performance targets. &nbsp;The agreement also includes an award of 75,000 options for the purchase of shares of our common stock exercisable at $2.02 for five years, with 25,000 of the options vesting on March 31, 2009, 25,000 options vesting on March 31, 2010 and 25,000 options vesting on March 31, 2011. &nbsp;The term of the agreement is three years.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px" align=center>13</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always"><B>ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS </B></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; text-indent:48px"><I>This discussion and analysis contains statements of a forward-looking nature relating to future events or our future financial performance or financial condition. &nbsp;Such statements are only predictions and the actual events or results may differ materially from the results discussed in or implied by the forward-looking statements. The historical results set forth in this discussion and analysis are not necessarily indicative of trends with respect to any actual or projected future financial performance. &nbsp;This discussion and analysis should be read in conjunction with the financial statements and the related notes thereto included elsewhere in this report.</I></P>
<P style="margin:0px"><BR></P>
<A NAME="Acquisitions_225050"></A><A NAME="ResultsOfOperations_225119"></A><P style="margin:0px"><B>Introduction and Recent Developments </B></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:6.667px; text-indent:48px">Since our inception in 1995, we have been engaged in the research and development of technologies related to the formulation of polyurethane compounds and the manufacturing process for producing tires constructed of polyurethane. &nbsp;We believe we have developed unique polyurethane formulations that, when used in tire applications, substantially simplify the production process and allow for the creation of products with superior performance characteristics, including abrasion resistance and load-bearing capabilities, than conventional rubber tires. &nbsp;We also believe that the manufacturing processes we have developed to produce polyurethane tires are more efficient than traditional tire manufacturing processes, in part because our polyurethane compounds do not require the multiple processing steps, extreme heat, and high pressure that are necessary to cure rubber. &nbsp;Using our polyurethane technologies, we believe tires can be produced that last longer, are less susceptible to failure and offer improved fuel economy. &nbsp;</P>
<P style="line-height:17.333px; margin-top:0px; margin-bottom:-17.333px; font-size:14.667px">&nbsp;</P>
<P style="margin:0px; text-indent:48px">We are concentrating on five principal product areas: tire fill, low duty cycle tires, solid tires, composite tires and pneumatic tires. Effective April 2, 2008, we hired Michael Kapral as Vice President of Marketing. Mr. Kapral has an extensive 25 year career in the tire and tire products industry will oversee our marketing and sales efforts for the five principal product areas. Our most recent activities in these areas are set forth below:</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; text-indent:48px">Tire fill - In January 2008 we announced the formation of an internal sales group to specifically target suppliers and OEM (original equipment manufacturer) users of tire fill in the construction, industrial and mining applications. We showcased our Amerifill&#8482; light weight fill material at two industry trade shows held in Las Vegas during February and March 2008 and expect to recognize the first significant revenues from this product during the fiscal quarter ending June 30, 2008. In addition, we have been working with a European marketing partner to commence sales of this product in Europe. </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; text-indent:48px">Low duty tires - In connection with our low duty cycle product area, in February 2008 we announced that Amigo Mobility, a leading manufacturer of mobility products, will be using our Flatfree(TM) polyurethane tires as original equipment on the Amigo Mobility SmartShopper. &nbsp;We estimate that we will initially supply Amigo Mobility with approximately 25,000 tires per year. &nbsp;In March 2008, we acquired the manufacturing assets of a well known manufacturer of polyurethane foam tires, Kik Technology, Inc. (&#147;Kik&#148;). The acquisition of the Kik manufacturing assets gives us the ability to produce a broader range of products for the low-duty cycle tire market. We anticipate this transaction will have positive impact on our future foam tire product revenues.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; text-indent:48px">Solid tires &#150; On May 1, 2008, we announced we have initiated commercial production of solid polyurethane elastomer tires. &nbsp;We announced that we have been awarded the production business by Oxbo International Corporation to supply 15&#148;x 13&#148; solid polyurethane elastomer gage tires for use in farm implements employed in chopping or baling alfalfa or hay. We estimate the first year volume for the 50-lb. gage tire is estimated to be 1,200 units or approximately $200,000 in revenue. &nbsp;The gage tire represents the first of several solid polyurethane elastomer tire products that we have been developing for the commercial markets. Other potential commercial applications for the solid polyurethane elastomer tires include forklift and aperture tires used in the construction and material handling industry. We have recently demonstrated the capability of making solid polyurethane elastomer forklift tires at the rate of one tire per minute, using our advanced production technology and hope to see these products go commercial in the near future. &nbsp;&nbsp;&nbsp;&nbsp;</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; text-indent:48px">Composite tires &#150; There are multiple applications for use of our polyurethane elastomer material as treads for new or retread tire casings. The first commercial application for this technology is being initiated by Desert Research Technology (&#147;DRT), to manufacture paddle-type sand tires. &nbsp;DRT expects to commence commercial production of this product during the fiscal quarter ending June 30, 2008 and we will supply DRT with the chemical system necessary to produce the tires. In addition, our licensee, Qingdao Qizhou Rubber Company, Ltd. </P>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px" align=center>14</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always">(&#147;Qingdao&#148;), is nearing completion of a OTR retread facility outside Qingdao, China. Qingdao. Qingdao has represented to us that it expects to have its facility ready for initial production of prototype retread polyurethane OTR mining tires prior to the end of the fiscal quarter ending June 30, 2008. &nbsp;</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; text-indent:48px">Pneumatic tires &#150; Our Arcus&#174; run-flat tire design successfully completed all testing requirements under Federal Motor Vehicle Safety Standard (FMVSS) 139. Successful completion of FMVSS 139 testing on our Arcus&#174; passenger car tire design has been a high priority. Since completing the testing, we have begun discussions with companies that have expressed an interest in licensing our technology, and we have begun to provide them with sample tires. While companies evaluate sample tires, we will focus on finishing the design and development of the manufacturing equipment required to produce the polyurethane road tire in commercial volumes. We are discussing the construction and installation of a pilot manufacturing facility capable of demonstrating this production capability with potential strategic partners.</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:13.333px"><B>Factors Affecting Results of Operations</B></P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">Historically, our operating expenses have exceeded our revenues resulting in net losses. For the reporting period our operating expenses consisted primarily of the following:</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:74.667px; text-indent:-24px; font-family:Symbol"><FONT FACE="Symbol">&#183;</FONT></P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:74.667px"><FONT FACE="Times New Roman">Cost of sales, which consists primarily of raw materials, components and production of our products, including applied labor costs and benefits expenses, maintenance, facilities and other operating costs associated with the production of our products; </FONT></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:74.667px; text-indent:-24px; font-family:Symbol"><FONT FACE="Symbol">&#183;</FONT></P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:74.667px"><FONT FACE="Times New Roman">Selling, general and administrative expenses, which consist primarily of salaries, commissions and related benefits paid to our employees and related selling and administrative costs including professional fees; &nbsp;</FONT></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:74.667px; text-indent:-24px; font-family:Symbol"><FONT FACE="Symbol">&#183;</FONT></P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:74.667px"><FONT FACE="Times New Roman">Research and development expenses, which consist primarily of equipment and materials used in the development of our technologies;</FONT></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:74.667px; text-indent:-24px; font-family:Symbol"><FONT FACE="Symbol">&#183;</FONT></P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:74.667px"><FONT FACE="Times New Roman">Consulting expenses, which consist primarily of amounts (both cash and non-cash) paid to third-parties for outside services; </FONT></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:74.667px; text-indent:-24px; font-family:Symbol"><FONT FACE="Symbol">&#183;</FONT></P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:74.667px"><FONT FACE="Times New Roman">Depreciation and amortization expenses which result from the depreciation of our property and equipment, including amortization of our intangible assets; and</FONT></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:74.667px; text-indent:-24px; font-family:Symbol"><FONT FACE="Symbol">&#183;</FONT></P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:74.667px"><FONT FACE="Times New Roman">Amortization of deferred compensation that results from the grant of stock options to our employees.</FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><B>Critical Accounting Policies and Estimates </B></P>
<P style="margin-top:6px; margin-bottom:0px; text-indent:32.667px">Our discussion and analysis of financial condition and results of operations are based upon our unaudited financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of such statements requires us to make estimates and assumptions that affect the reported amounts of revenues and expenses during the reporting period and the reported amounts of assets and liabilities as of the date of the financial statements. Our estimates are based on historical experience and other assumptions that we consider to be appropriate in the circumstances. However, actual future results may vary from our estimates. </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; text-indent:32.667px">There have been no significant changes during the three months ended March 31, 2008 to the items that we disclosed as our critical accounting policies and estimates in our Management&#146;s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form&nbsp;10-K for the fiscal year ended June&nbsp;30, 2007.</P>
<P style="margin-top:0px; margin-bottom:6.667px"><BR></P>
<P style="margin-top:0px; margin-bottom:6.667px"><B>Seasonality</B></P>
<P style="line-height:normal; margin-top:0px; margin-bottom:6.667px; text-indent:48px">A substantial majority of our sales are to customers within the United States. As sales have increased, we have experienced increasing levels of seasonality in the sale of our low duty polyurethane foam tires for bicycles and lawn and garden products because sales of these products generally decline during the winter months in many parts of the United States. &nbsp;Sales of our low duty polyurethane foam tire products generally peak during the spring and summer months resulting in greater sales volumes during the third and fourth quarters of the fiscal year.</P>
<P style="margin-top:0px; margin-bottom:6.667px"><BR></P>
<P style="margin-top:0px; margin-bottom:6.667px"><BR>
<BR></P>
<P style="margin:0px" align=center>15</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:6.667px; page-break-before:always"><B>Results of Operations </B></P>
<P style="margin-top:0px; margin-bottom:6.667px; text-indent:48px">Our management reviews and analyzes several key performance indicators in order to manage our business and assess the quality and potential variability of our revenues and cash flows. These key performance indicators include:</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:74.667px; text-indent:-24px; font-family:Symbol"><FONT FACE="Symbol">&#183;</FONT></P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:74.667px"><FONT FACE="Times New Roman">Net revenues, which consists of sales revenues and license fees;</FONT></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:74.667px; text-indent:-24px; font-family:Symbol"><FONT FACE="Symbol">&#183;</FONT></P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:74.667px"><FONT FACE="Times New Roman">Sales revenue, net of returns and trade discounts, which is an indicator of our overall business growth and the success of our sales and marketing efforts;</FONT></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:74.667px; text-indent:-24px; font-family:Symbol"><FONT FACE="Symbol">&#183;</FONT></P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:74.667px"><FONT FACE="Times New Roman">Gross profit, which is an indicator of both competitive pricing pressures and the cost of revenues of our products;</FONT></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:74.667px; text-indent:-24px; font-family:Symbol"><FONT FACE="Symbol">&#183;</FONT></P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:74.667px"><FONT FACE="Times New Roman">Growth in our customer base, which is an indicator of the success of our sales efforts; and</FONT></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:74.667px; text-indent:-24px; font-family:Symbol"><FONT FACE="Symbol">&#183;</FONT></P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:74.667px"><FONT FACE="Times New Roman">Distribution of revenue across our products offered.</FONT></P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">The following summary table presents a comparison of our results of operations for the three and nine month periods ended March 31, 2008 and 2007 with respect to certain key financial measures. &nbsp;The comparisons illustrated in the table are discussed in greater detail below.</P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=156.867></TD><TD width=21.067></TD><TD width=79.267></TD><TD width=21.067></TD><TD width=98.933></TD><TD width=68.667></TD><TD width=21.067></TD><TD width=78.667></TD><TD width=21.067></TD><TD width=85.8></TD><TD width=68.667></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=156.867><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=199.267 colspan=3><P style="margin:0px">Three Months Ended March 31,</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=68.667><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=185.533 colspan=3><P style="margin:0px">Nine Months Ended March 31,</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=68.667><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=156.867><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=79.267><P style="margin:0px" align=center><U>2008</U></P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=98.933><P style="margin:0px" align=center><U>2007</U></P>
</TD><TD valign=bottom width=68.667><P style="margin:0px" align=center><U>% Change</U></P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=78.667><P style="margin:0px" align=center><U>2008</U></P>
</TD><TD valign=bottom width=21.067><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=85.8><P style="margin:0px" align=center><U>2007</U></P>
</TD><TD valign=bottom width=68.667><P style="margin:0px" align=center><U>% Change</U></P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=156.867><P style="margin:0px">Net revenues (1)</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=79.267><P style="margin:0px" align=right>828,862&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=98.933><P style="margin:0px" align=right>723,717&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=68.667><P style="margin:0px" align=center>15</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=78.667><P style="margin:0px" align=right>2,025,711&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=85.8><P style="margin:0px" align=right>1,956,045&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=68.667><P style="margin:0px" align=center>4</P>
</TD></TR>
<TR><TD valign=bottom width=156.867><P style="margin:0px">Cost of revenues</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD valign=bottom width=79.267><P style="margin:0px" align=right>563,529&nbsp;</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD valign=bottom width=98.933><P style="margin:0px" align=right>457,269&nbsp;</P>
</TD><TD valign=bottom width=68.667><P style="margin:0px" align=center>23</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD valign=bottom width=78.667><P style="margin:0px" align=right>1,331,832&nbsp;</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD valign=bottom width=85.8><P style="margin:0px" align=right>1,244,468&nbsp;</P>
</TD><TD valign=bottom width=68.667><P style="margin:0px" align=center>7</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=156.867><P style="margin:0px">Gross profit</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=79.267><P style="margin:0px" align=right>265,333&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=98.933><P style="margin:0px" align=right>266,448&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=68.667><P style="margin:0px" align=center>(0)</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=78.667><P style="margin:0px" align=right>693,879&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=85.8><P style="margin:0px" align=right>711,577&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=68.667><P style="margin:0px" align=center>(2)</P>
</TD></TR>
<TR><TD valign=bottom width=156.867><P style="margin:0px">Selling, general, and administrative expenses (2)</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px"><BR></P>
<P style="margin:0px">$</P>
</TD><TD valign=bottom width=79.267><P style="margin:0px" align=right>1,007,785&nbsp;</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px"><BR></P>
<P style="margin:0px">$</P>
</TD><TD valign=bottom width=98.933><P style="margin:0px" align=right>1,363,544&nbsp;</P>
</TD><TD valign=bottom width=68.667><P style="margin:0px" align=center>(26)</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px"><BR></P>
<P style="margin:0px">$</P>
</TD><TD valign=bottom width=78.667><P style="margin:0px" align=right>3,046,168&nbsp;</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px"><BR></P>
<P style="margin:0px">$</P>
</TD><TD valign=bottom width=85.8><P style="margin:0px" align=right>3,509,312&nbsp;</P>
</TD><TD valign=bottom width=68.667><P style="margin:0px" align=center>(13)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=156.867><P style="margin:0px">Consulting (3)</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=79.267><P style="margin:0px" align=right>101,510&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=98.933><P style="margin:0px" align=right>150,162&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=68.667><P style="margin:0px" align=center>(32)</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=78.667><P style="margin:0px" align=right>276,615&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=85.8><P style="margin:0px" align=right>286,274&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=68.667><P style="margin:0px" align=center>(3)</P>
</TD></TR>
<TR><TD valign=bottom width=156.867><P style="margin:0px">Research and development expenses </P>
</TD><TD valign=bottom width=21.067><P style="margin:0px"><BR></P>
<P style="margin:0px">$</P>
</TD><TD valign=bottom width=79.267><P style="margin:0px" align=right>146,811&nbsp;</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px"><BR></P>
<P style="margin:0px">$</P>
</TD><TD valign=bottom width=98.933><P style="margin:0px" align=right>173,178&nbsp;</P>
</TD><TD valign=bottom width=68.667><P style="margin:0px" align=center>(15)</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px"><BR></P>
<P style="margin:0px">$</P>
</TD><TD valign=bottom width=78.667><P style="margin:0px" align=right>461,267&nbsp;</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px"><BR></P>
<P style="margin:0px">$</P>
</TD><TD valign=bottom width=85.8><P style="margin:0px" align=right>629,655&nbsp;</P>
</TD><TD valign=bottom width=68.667><P style="margin:0px" align=center>(27)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=156.867><P style="margin:0px">Depreciation and amortization expenses</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px"><BR></P>
<P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=79.267><P style="margin:0px" align=right>69,482&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px"><BR></P>
<P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=98.933><P style="margin:0px" align=right>92,772&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=68.667><P style="margin:0px" align=center>(25)</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px"><BR></P>
<P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=78.667><P style="margin:0px" align=right>220,753&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px"><BR></P>
<P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=85.8><P style="margin:0px" align=right>286,756&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=68.667><P style="margin:0px" align=center>(23)</P>
</TD></TR>
<TR><TD valign=bottom width=156.867><P style="margin:0px">Loss on sales and impairment of assets</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px"><BR></P>
<P style="margin:0px">$</P>
</TD><TD valign=bottom width=79.267><P style="margin:0px" align=right>-&nbsp;</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px"><BR></P>
<P style="margin:0px">$</P>
</TD><TD valign=bottom width=98.933><P style="margin:0px" align=right>-&nbsp;</P>
</TD><TD valign=bottom width=68.667><P style="margin:0px" align=center>0</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px"><BR></P>
<P style="margin:0px">$</P>
</TD><TD valign=bottom width=78.667><P style="margin:0px" align=right>462&nbsp;</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px"><BR></P>
<P style="margin:0px">$</P>
</TD><TD valign=bottom width=85.8><P style="margin:0px" align=right>3,082&nbsp;</P>
</TD><TD valign=bottom width=68.667><P style="margin:0px" align=center>(85)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=156.867><P style="margin:0px">Other Income</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=79.267><P style="margin:0px" align=right>54,939&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=98.933><P style="margin:0px" align=right>8,117&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=68.667><P style="margin:0px" align=center>576</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=78.667><P style="margin:0px" align=right>184,214&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=85.8><P style="margin:0px" align=right>50,086&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=68.667><P style="margin:0px" align=center>268</P>
</TD></TR>
<TR><TD style="border-bottom:1px solid #000000" valign=bottom width=156.867><P style="margin:0px">Net loss</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD valign=bottom width=79.267><P style="margin:0px" align=right>(1,005,316)</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD valign=bottom width=98.933><P style="margin:0px" align=right>(1,505,091)</P>
</TD><TD valign=bottom width=68.667><P style="margin:0px" align=center>(33)</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD valign=bottom width=78.667><P style="margin:0px" align=right>(3,127,172)</P>
</TD><TD valign=bottom width=21.067><P style="margin:0px">$</P>
</TD><TD valign=bottom width=85.8><P style="margin:0px" align=right>(3,953,416)</P>
</TD><TD valign=bottom width=68.667><P style="margin:0px" align=center>(21)</P>
</TD></TR>
</TABLE>
<P style="margin-top:0px; margin-bottom:5.333px"><BR></P>
<P style="line-height:13.333px; margin-top:0px; margin-bottom:5.333px; padding-left:24px; font-size:10.667px">(1) Includes $50,000 and $160,000, respectively, of license revenue in the three and nine months ended March 31, 2008 with no associated cost of revenues for the period. Includes $75,000 and $191,667, respectively, of license revenue in the three and nine months ended March 31, 2007 with no associated cost of revenues for the period.</P>
<P style="line-height:13.333px; margin-top:0px; margin-bottom:5.333px; padding-left:24px; font-size:10.667px">(2) Includes deferred compensation for employee stock options of $92,441 and $241,504 in the three month periods ended March &nbsp;31, 2008 and 2007, respectively, and deferred compensation for employee stock options of $265,400 and $576,195 in the nine month periods ended March 31, 2008 and 2007, respectively.</P>
<P style="line-height:13.333px; margin-top:0px; margin-bottom:5.333px; padding-left:24px; font-size:10.667px">(3) Includes $73,732, representing the pro rata value of the stock option granted to Mr. Steinke during the nine months ended March 31, 2008 for services pursuant to a consulting agreement dated September 1, 2007.</P>
<P style="margin-top:0px; margin-bottom:6.667px"><BR></P>
<P style="margin-top:0px; margin-bottom:6.667px"><I>Three Month Period Ended March 31, 2008 Compared to March 31, 2007</I></P>
<P style="margin-top:0px; margin-bottom:6.667px; text-indent:48px"><I>Net revenues</I>. &nbsp;&nbsp;Sales of our closed-cell polyurethane foam products accounted for all but $50,000 of our net revenues during the three month period ended March 31, 2008. The $50,000 was derived from fees &nbsp;accrued from third-party licensees for use of our technology. &nbsp;For the three month period ended March 31, 2008 we had $828,862 of net revenues compared to $723,717 for the same period for 2007. &nbsp;Net revenues for the three month period ended March 31, 2008 increased by $105,145 or 15%, as compared with 2007 due to an increase in the number of product units sold, offset by a small decrease in license fees. &nbsp;&nbsp;We anticipate that our sales over the balance of the fiscal year will increase consistent with the trends of our sales over the last several years. &nbsp;During the three month period ended </P>
<P style="margin-top:0px; margin-bottom:6.667px"><BR>
<BR></P>
<P style="margin:0px" align=center>16</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:6.667px; page-break-before:always">March 31, 2008 we had $19,634 and $4,061 of returns of our products and trade discounts, respectively, compared to $15,611 and $3,198, respectively, for the same period in 2007.</P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px"><I>Cost of revenues</I>.&nbsp; For the three month period ended March 31, 2008 our total cost of revenues was $563,529, or 68% of net revenues, compared to $457,269, or 63% of net revenues for the same period in 2007. &nbsp;Excluding $50,000 of licensee revenue with no associated cost of revenues, our cost of revenues as a percentage of net revenues increased to 72% of net revenues for the three months ended March 31, 2008, as compared with 70% for the same period in 2007. The increase in our cost of revenues was a result of increasing cost of chemical raw materials and wheel components. We believe that our cost of revenues can improve if our sales efforts generate additional product orders so that we can take advantage of manufacture efficiencies. We believe we currently have sufficient foam product manufacturing equipment and employees to accomplish a substantial increase in production without incurring a proportionately equivalent increase in labor costs. </P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px"><I>Gross Profit</I>. &nbsp;For the three month period ended March 31, 2008 we had $265,333 of gross profit compared to $266,448 for the same period in 2007. &nbsp;Gross profit for the three month period ended March 31, 2008 decreased by $1,115, or 0.4%, over the same period in 2007 due primarily to increase in the cost of revenues during the period, as discussed above. &nbsp;As a result of the increased costs our gross profit margin decreased to 32% in 2008 from 37% for the same period in 2007. We intend to implement product pricing increases beginning in May 2008 to help cover our increased costs and improve our gross profit margin. </P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px"><I>Selling, General, and Administrative Expenses</I>. &nbsp;For the three month period ended March 31, 2008 we had $1,007,785 of SG&amp;A expenses, including the amortization of deferred compensation, compared to $1,363,544 for the same period in 2007. &nbsp;For the three month period ended March 31, 2008 our SG&amp;A decreased by $355,759, or 26%, as compared with the same period in 2007, due to decreased expenses related to payroll and payroll taxes, travel expenses, sales and marketing costs, and amortization of deferred compensation related to employee stock option grants. We amortized $92,441 of deferred compensation for the three month period ended March 31, 2008 compared to $241,504 for same period in 2007. &nbsp;We anticipate that SG&amp;A for the balance of the 2008 fiscal year will be consistent with the three months ended March 31, 2008. </P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px"><I>Research and Development Expenses</I>. &nbsp;For the three month period ended March 31, 2008 we had $146,811 of research and development expenses compared to $173,178 for the same period in 2007. &nbsp;Our research and development expenses for the three month period ended March 31, 2008, decreased by $26,367, or 15%, as compared with the same period in 2007 due primarily to a decrease in outside testing services and testing equipment. &nbsp;We expect research and development expenses to increase 15% during the balance of the fiscal year ending June 30, 2008 as we identify and pursue research and development projects of additional applications for our polyurethane technology outside the tire industry.</P>
<P style="margin:0px; text-indent:48px"><I>Consulting Expenses</I>. &nbsp;For the three month period ended March 31, 2008 we had $101,510 in outside consulting expenses. &nbsp;We had $150,162 in outside consulting expenses for the same period in 2007. &nbsp;During the balance of the fiscal year ending June 30, 2008 we expect consulting expenses to remain consistent with the three month period ended March 31, 2008. &nbsp;</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px"><I>Depreciation and Amortization Expenses</I>. &nbsp;For the three month period ended March 31, 2008 we had $69,482 of depreciation and amortization expenses compared to $92,772 for the same period in 2007. &nbsp;Our depreciation and amortization expenses for the three month period ended March 31, 2008 decreased by $23,190, or 25%, as compared to the same period in 2007 due primarily to reductions for fully depreciated assets, partially offset by the expense for newly acquired assets during the period.</P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px"><I>Net Loss</I>. &nbsp;For the three month period ended March 31, 2008 we had a net loss of $1,005,316 compared to a net loss of $1,505,091 for the same period in 2007. &nbsp;Our net loss for the three month period ended March 31, 2008 decreased by $499,775 as compared with the same period in 2007, due primarily to the decreases in our research and development expenses, payroll and payroll taxes, and selling, general and administrative expenses for the three month period ended March 31, 2008, combined with an approximate 14.5% increase in net revenues..</P>
<P style="margin-top:0px; margin-bottom:6.667px"><BR>
<BR></P>
<P style="margin:0px" align=center>17</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:6.667px; page-break-before:always"><I>Nine Month Period Ended March 31, 2008 Compared to March 31, 2007</I></P>
<P style="margin-top:0px; margin-bottom:6.667px; text-indent:48px"><I>Net revenues</I>. &nbsp;&nbsp;Sales of our closed-cell polyurethane foam products accounted for all but $160,000 of our net revenues during the nine month period ended March 31, 2008. The $160,000 was derived from fees received or accrued from third-party licensees for use of our technology. For the nine month period ended March 31, 2008 we had $2,025,711 of net revenues compared to $1,956,045 for the same period in 2007. &nbsp;Net revenues for the nine month period ended March 31, 2008 increased by $69,666, or 4%, as compared with 2007, due to &nbsp;an increase in the number of product units sold during the period offset by a decrease in license fees, as discussed above in the Three Month Period analysis. During the nine month period ended March 31, 2008 we had $31,791 and $10,514 of returns of our products and trade discounts, respectively, compared to $29,503 and $9,689, respectively, for the same period in 2007.</P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px"><I>Cost of revenues</I>.&nbsp; For the nine month period ended March 31, 2008 our total cost of revenues was $1,331,832, or 66% of net revenues, compared to $1,244,468, or 64% of net revenues for the same period in 2007. &nbsp;Excluding $160,000 of licensee revenue with no associated cost of revenues, our total cost of revenues was 71% of net revenues for the nine months ended March 31, 2008, compared to 71% of net revenues for the same period in 2007. The maintenance of our cost of revenues was a result of our efforts to control expenses and to take advantage of manufacturing efficiencies. We believe we currently have sufficient foam product manufacturing equipment and employees to accomplish a substantial increase in production without incurring a proportionately equivalent increase in labor costs. </P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px"><I>Gross Profit</I>. &nbsp;For the nine month period ended March 31, 2008 we had $693,879 of gross profit compared to $711,577 for the same period in 2007. &nbsp;Gross profit for the nine month period ended March 31, 2008 decreased by $17,698, or 2%, over same period in 2007 due primarily to an increase in the cost of revenues during the period. &nbsp;Our gross profit margin decreased slightly to 34% in 2008 from 36% for the same period in 2007. &nbsp;The slight decrease in our gross profit for the nine month period ended March 31, 2008 as compared to the nine month period ended March 31, 2007 was the result of a 17% decrease in net revenues derived from third-party license fees, combined with an increase of 6% in foam product sales. &nbsp;During the balance of the fiscal year ending June 30, 2008, we believe that we will be able to maintain our gross margin consistent with the nine months ended March 31, 2008.</P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px"><I>Selling, General, and Administrative Expenses</I>. &nbsp;For the nine month period ended March 31, 2008 we had $3,046,168 of SG&amp;A expenses, including the amortization of deferred compensation, compared to $3,509,312 for the same period in 2007. For the nine month period ended March 31, 2008 our SG&amp;A decreased by $463,144, or 13%, as compared with the same period in 2007, due primarily to decreases in travel, payroll and payroll taxes, advertising, and expenses related to stock options issued to employees, offset by increases in insurance, professional fees, office and facilities expenses. We anticipate that SG&amp;A for the balance of the 2008 fiscal year will be consistent with the nine months ended March 31, 2008.</P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px"><I>Research and Development Expenses</I>. &nbsp;For the nine month period ended March 31, 2008 we had $461,267 of research and development expenses compared to $629,655 for the same period in 2007. &nbsp;Our research and development expenses for the nine month period ended March 31, 2008, decreased by $168,388, or 27%, as compared with the same period in 2007 due primarily to a decrease in outside testing services during the period. &nbsp;We expect research and development expenses to increase approximately 10% during the balance of the fiscal year ending June 30, 2008 as we identify and pursue research and development projects of additional applications for our polyurethane technology outside the tire industry.</P>
<P style="margin:0px; text-indent:48px"><I>Consulting Expenses</I>. &nbsp;For the nine month period ended March 31, 2008, we had $276,615 in outside consulting expenses. &nbsp;We had $286,274 in outside consulting expenses for the same period in 2007. During the balance of the fiscal year ending June 30, 2008 we expect consulting expenses to remain proportionately consistent </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px"><I>Depreciation and Amortization Expenses</I>. &nbsp;For the nine month period ended March 31, 2008 we had $220,753 of depreciation and amortization expenses compared to $286,756 for the same period in 2007. &nbsp;Our depreciation and amortization expenses for the nine month period ended March 31, 2008 decreased by $66,003, or 23%, as compared to the same period in 2007 due primarily to certain assets having been fully depreciated, partially offset by the expense for newly acquired assets during the period.</P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px"><I>Net Loss</I>. &nbsp;For the nine month period ended March 31, 2008 we had a net loss of $3,127,172 compared to a net loss of $3,953,416 for the same period in 2007. &nbsp;Our net loss for the nine month period ended March 31, 2008 decreased by $826,244 as compared with the same period in 2007 due primarily to the decrease in the research and </P>
<P style="margin-top:0px; margin-bottom:13.333px"><BR>
<BR></P>
<P style="margin:0px" align=center>18</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:13.333px; page-break-before:always">development, and selling, general and administrative expenses for the nine month period ended March 31, 2008.</P>
<P style="margin-top:0px; margin-bottom:13.333px; padding-left:13.467px; text-indent:-13.467px"><B>Liquidity and Capital Resources</B></P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">Our principal sources of liquidity consist of cash and cash equivalents and payments received from our customers. &nbsp;We have no long-term liabilities, and we do not have any significant credit arrangements. &nbsp;Historically, our expenses have exceeded our revenues, resulting in operating losses. &nbsp;From time to time, we have obtained additional liquidity to fund our operations through the sale of shares of our common stock. &nbsp;In assessing our liquidity, our management reviews and analyzes our current cash balances on-hand, short-term investments, accounts receivable, accounts payable, capital expenditure commitments and other obligations.</P>
<P style="margin-top:0px; margin-bottom:6.667px"><I>Cash Flows</I></P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">The following table sets forth our consolidated cash flows for the nine month periods ended March 31, 2008 and 2007.</P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=357.2></TD><TD width=19.4></TD><TD width=8.067></TD><TD width=1.133></TD><TD width=64.2></TD><TD width=6></TD><TD width=7.267></TD><TD width=11.6></TD><TD width=53.267></TD><TD width=19.4></TD><TD width=11.6></TD><TD width=61.867></TD><TD width=9></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=357.2><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=19.4><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD style="background-color:#FFFF99; border-bottom:1px solid #000000" valign=bottom width=244.4 colspan=10><P style="line-height:13.333px; margin:0px" align=center>Nine Months Ended&nbsp;March 31,</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=9><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD></TR>
<TR><TD valign=bottom width=357.2><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD valign=bottom width=19.4><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD valign=bottom width=73.4 colspan=3><P style="line-height:13.333px; margin:0px" align=center><U>2008</U></P>
</TD><TD valign=bottom width=13.267 colspan=2><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD valign=bottom width=64.867 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=19.4><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD valign=bottom width=73.467 colspan=2><P style="line-height:13.333px; margin:0px" align=center><U>2007</U></P>
</TD><TD valign=bottom width=9><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=357.2><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=19.4><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=244.4 colspan=10><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=9><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=357.2><P style="margin:0px; padding-left:13.333px; text-indent:-13.333px">Net cash used by operating activities</P>
</TD><TD valign=bottom width=19.4><P style="margin:0px">&nbsp;</P>
</TD><TD valign=bottom width=8.067><P style="margin:0px">$</P>
</TD><TD valign=bottom width=71.333 colspan=3><P style="margin:0px" align=right>(3,005,188</P>
</TD><TD valign=bottom width=7.267><P style="margin:0px">)</P>
</TD><TD valign=bottom width=11.6><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=53.267><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=19.4><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=11.6><P style="margin:0px">$ </P>
</TD><TD valign=bottom width=61.867><P style="margin:0px" align=right>(2,677,757</P>
</TD><TD valign=bottom width=9><P style="margin:0px">)</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=357.2><P style="margin:0px; padding-left:13.333px; text-indent:-13.333px">Net cash used in investing activities</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=19.4><P style="margin:0px">&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=79.4 colspan=4><P style="margin:0px" align=right>(116,711</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=7.267><P style="margin:0px">)</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=64.867 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=19.4><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=73.467 colspan=2><P style="margin:0px" align=right>(284,723</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=9><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=top width=357.2><P style="margin:0px; padding-left:13.333px; text-indent:-13.333px">Net cash provided by financing activities</P>
</TD><TD valign=bottom width=19.4><P style="margin:0px">&nbsp;</P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=79.4 colspan=4><P style="margin:0px" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD valign=bottom width=7.267><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=64.867 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD valign=bottom width=19.4><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=73.467 colspan=2><P style="margin:0px" align=right>3,235,402</P>
</TD><TD valign=bottom width=9><P style="margin:0px">&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=357.2><P style="margin:0px; padding-left:13.333px; text-indent:-13.333px">Net (decrease) increase in cash and cash equivalents during period</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=19.4><P style="margin:0px">&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=9.2 colspan=2><P style="margin:0px" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=70.2 colspan=2><P style="margin:0px" align=right>(3,121,899</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=7.267><P style="margin:0px">)</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=11.6><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=53.267><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=19.4><P style="margin:0px" align=right>&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=11.6><P style="margin:0px">$</P>
</TD><TD style="background-color:#FFFF99; border-bottom:2.667px double #000000" valign=bottom width=61.867><P style="margin:0px" align=right>272,922</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=9><P style="margin:0px" align=right>&nbsp;</P>
</TD></TR>
<TR><TD width=357.2><P style="font-size:2pt">&nbsp;</P></TD><TD width=19.4><P style="font-size:2pt">&nbsp;</P></TD><TD width=8.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="border-top:2.667px double #000000" width=71.333 colspan=3><P style="font-size:2pt">&nbsp;</P></TD><TD width=7.267><P style="font-size:2pt">&nbsp;</P></TD><TD width=11.6><P style="font-size:2pt">&nbsp;</P></TD><TD width=53.267><P style="font-size:2pt">&nbsp;</P></TD><TD width=19.4><P style="font-size:2pt">&nbsp;</P></TD><TD width=11.6><P style="font-size:2pt">&nbsp;</P></TD><TD width=61.867><P style="font-size:2pt">&nbsp;</P></TD><TD width=9><P style="font-size:2pt">&nbsp;</P></TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px; text-indent:48px"><I>Net Cash Used By Operating Activities. </I>&nbsp;Our primary sources of operating cash during the nine month period ended March 31, 2008 was receipts from our customers and proceeds from an equity financing completed during fiscal 2007. &nbsp;Our primary uses of operating cash are payments made to our vendors and employees. Net cash used by operating activities was $3,005,188 for the nine months ended March 31, 2008 compared to $2,677,757 for the same period in 2007. &nbsp;The increase in cash used in operating activities is primarily due to increases in accounts receivable, prepaid assets and other assets expenses, supplemented by a decrease in accounts payable and other liabilities for the nine months ended March 31, 2008 compared to the same period in 2007. &nbsp;Non-cash items include depreciation and amortization and stock based compensation. &nbsp;Our net loss was $3,127,172 for the nine months ended March 31, 2008 compared to a net loss of $3,953,416 for the same period in 2007. &nbsp;Net loss for the nine month period ended March 31, 2008 included non-cash expenses of $265,400 for stock-based compensation related to employee stock options and $220,753 for amortization and depreciation expenses, as well as $130,595 in common stock issued or accrued for services and $73,732 in stock options issued for services.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; text-indent:48px"><I>Net Cash Used In Investing Activities. &nbsp;</I>Net cash used by investing activities was $116,711 for the nine month period ended March 31, 2008 and $284,723 for the same period in 2007. &nbsp;Our primary uses of investing cash for the nine month period ended March 31, 2008 were $67,072 deposits on patents and trademarks and $50,383 for property and equipment. &nbsp;Our primary uses of investing cash for the nine month period ended March 31, 2007 were $128,086 deposits on patents and trademarks and $156,637 for property and equipment.</P>
<P style="margin:0px"><BR></P>
<A NAME="page_dm1180_1_35"></A><P style="margin:0px; text-indent:48px"><I>Net Cash Provided by Financing Activities</I>. &nbsp;During the nine months ended March 31, 2008, we did not participate in any financing activities. During the nine month period ended March 31, 2007, financing activities provided net cash of $3,235,402, received in connection with the issuance of common stock on the exercise of warrants.<A NAME="CashPositionAndIndebtedness_224529"></A></P>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px" align=center>19</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always"><BR></P>
<P style="margin:0px; text-indent:48px"><I>Cash Position and Outstanding Indebtedness</I></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">Our total indebtedness at March 31, 2008 was $231,893 and our total cash and cash equivalents were $2,666,703, none of which is restricted. &nbsp;Our total indebtedness at March 31, 2008 includes $178,106 in accounts payable and $53,787 in accrued expenses, primarily consisting of payroll and payroll taxes accrued. We have no long-term liabilities.<A NAME="ContractualObligationsAndCommitme_224547"></A></P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px"><I>Contractual Obligations and Commitments</I></P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">The following table summarizes our contractual cash obligations and other commercial commitments at March 31, 2008.</P>
<TABLE style="font-size:13.333px" cellspacing=0 align=center><TR><TD width=218.267></TD><TD width=16></TD><TD width=8></TD><TD width=60.6></TD><TD width=4.267></TD><TD width=8.533></TD><TD width=8.733></TD><TD width=55.133></TD><TD width=8.067></TD><TD width=13.133></TD><TD width=9.2></TD><TD width=52></TD><TD width=4.267></TD><TD width=9.2></TD><TD width=46.867></TD><TD width=7.267></TD><TD width=0.733></TD><TD width=13></TD><TD width=45.133></TD><TD width=8.067></TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=218.267><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=16><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD style="background-color:#FFFF99; border-bottom:1.333px solid #000000" valign=bottom width=354.133 colspan=17><P style="line-height:13.333px; margin:0px" align=center>Payments&nbsp;due&nbsp;by&nbsp;period</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=8.067><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD></TR>
<TR><TD valign=bottom width=218.267><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD valign=bottom width=16><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD valign=bottom width=68.6 colspan=2><P style="line-height:13.333px; margin:0px" align=center>Total</P>
</TD><TD valign=bottom width=4.267><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD valign=bottom width=80.467 colspan=4><P style="line-height:13.333px; margin:0px" align=center>Less&nbsp;than<BR>
1&nbsp;year</P>
</TD><TD valign=bottom width=13.133><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD valign=bottom width=61.2 colspan=2><P style="line-height:13.333px; margin:0px" align=center>1 to 3&nbsp;years</P>
</TD><TD valign=bottom width=4.267><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD valign=bottom width=56.067 colspan=2><P style="line-height:13.333px; margin:0px" align=center>3 to 5&nbsp;years</P>
</TD><TD valign=bottom width=7.267><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD valign=bottom width=58.867 colspan=3><P style="line-height:13.333px; margin:0px" align=center>After<BR>
5&nbsp;years</P>
</TD><TD valign=bottom width=8.067><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=bottom width=218.267><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=16><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=354.133 colspan=17><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=8.067><P style="line-height:13.333px; margin:0px" align=center>&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=218.267><P style="margin:0px; padding-left:13.333px; text-indent:-13.333px">Facility lease <SUP>(1)</SUP></P>
</TD><TD valign=bottom width=16><P style="margin:0px">&nbsp;</P>
</TD><TD valign=bottom width=8><P style="margin:0px">$</P>
</TD><TD valign=bottom width=60.6><P style="margin:0px" align=right>1,377,200</P>
</TD><TD valign=bottom width=4.267><P style="margin:0px" align=right>&nbsp;</P>
</TD><TD valign=bottom width=8.533><P style="margin:0px" align=right>&nbsp;</P>
</TD><TD valign=bottom width=8.733><P style="margin:0px">$</P>
</TD><TD valign=bottom width=55.133><P style="margin:0px" align=right>295,200</P>
</TD><TD valign=bottom width=8.067><P style="margin:0px" align=right>&nbsp;</P>
</TD><TD valign=bottom width=13.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=bottom width=9.2><P style="margin:0px">$</P>
</TD><TD valign=bottom width=52><P style="margin:0px" align=right>590,000</P>
</TD><TD valign=bottom width=4.267><P style="margin:0px" align=right>&nbsp;</P>
</TD><TD valign=bottom width=9.2><P style="margin:0px">$</P>
</TD><TD valign=bottom width=46.867><P style="margin:0px" align=right>492,000</P>
</TD><TD valign=bottom width=8 colspan=2><P style="margin:0px" align=right>&nbsp;</P>
</TD><TD valign=bottom width=13><P style="margin:0px">$</P>
</TD><TD valign=bottom width=45.133><P style="margin:0px" align=right>&#151;</P>
</TD><TD valign=bottom width=8.067><P style="margin:0px" align=right>&nbsp;</P>
</TD></TR>
<TR><TD style="background-color:#FFFF99" valign=top width=218.267><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=16><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=68.6 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=4.267><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=8.533><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=63.867 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=8.067><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=13.133><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=61.2 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=4.267><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=56.067 colspan=2><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=7.267><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=58.867 colspan=3><P style="font-size:2pt">&nbsp;</P></TD><TD style="background-color:#FFFF99" valign=bottom width=8.067><P style="font-size:2pt">&nbsp;</P></TD></TR>
<TR><TD valign=top width=218.267><P style="margin:0px; padding-left:13.333px; text-indent:-13.333px">Total contractual cash obligations</P>
</TD><TD valign=bottom width=16><P style="margin:0px">&nbsp;</P>
</TD><TD style="border-bottom:4px double #000000" valign=bottom width=8><P style="margin:0px">$</P>
</TD><TD style="border-top:1.333px solid #000000; border-bottom:4px double #000000" valign=bottom width=60.6><P style="margin:0px" align=right>1,377,200</P>
</TD><TD valign=bottom width=4.267><P style="margin:0px" align=right>&nbsp;</P>
</TD><TD valign=bottom width=8.533><P style="margin:0px" align=right>&nbsp;</P>
</TD><TD style="border-bottom:4px double #000000" valign=bottom width=8.733><P style="margin:0px">$</P>
</TD><TD style="border-top:1.333px solid #000000; border-bottom:4px double #000000" valign=bottom width=55.133><P style="margin:0px" align=right>295,200</P>
</TD><TD valign=bottom width=8.067><P style="margin:0px" align=right>&nbsp;</P>
</TD><TD valign=bottom width=13.133><P style="margin:0px">&nbsp;</P>
</TD><TD style="border-bottom:4px double #000000" valign=bottom width=9.2><P style="margin:0px">$</P>
</TD><TD style="border-top:1.333px solid #000000; border-bottom:4px double #000000" valign=bottom width=52><P style="margin:0px" align=right>590,000</P>
</TD><TD valign=bottom width=4.267><P style="margin:0px" align=right>&nbsp;</P>
</TD><TD style="border-bottom:4px double #000000" valign=bottom width=9.2><P style="margin:0px">$</P>
</TD><TD style="border-top:1.333px solid #000000; border-bottom:4px double #000000" valign=bottom width=46.867><P style="margin:0px" align=right>492,000</P>
</TD><TD valign=bottom width=7.267><P style="margin:0px">&nbsp;</P>
</TD><TD style="border-bottom:4px double #000000" valign=bottom width=13.733 colspan=2><P style="margin:0px">$</P>
</TD><TD style="border-top:1.333px solid #000000; border-bottom:4px double #000000" valign=bottom width=45.133><P style="margin:0px" align=right>&#151;</P>
</TD><TD valign=bottom width=8.067><P style="margin:0px">&nbsp;</P>
</TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px">(1) &nbsp;In November 2007, we negotiated an extension of the lease for our executive and manufacturing facilities located at 1501 Industrial Road, Boulder City, Nevada. &nbsp;The property consists of a 49,200 square-foot building, which includes approximately 5,500 square-feet of office space, situated on approximately 4.15 acres. &nbsp;The extension term of the lease is 5 years expiring November 14, 2012. &nbsp;The base rent is $24,600 per month subject to annual adjustments based on the consumer price index.</P>
<P style="margin:0px"><BR></P>
<A NAME="FutureCapitalRequirements_224617"></A><P style="margin:0px"><I>Future Capital Requirements </I></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:6.667px; text-indent:48px">&nbsp;At March 31, 2008, we had approximately $2.67 million available to finance our operations. In an effort to increase revenues, we have recently expanded our product lines&nbsp;and begun the sale&nbsp;polyurethane foam tire fill and solid polyurethane elastomer tires. In December 2007, we offered aggressive sales projections based on our assessment of our planned sales initiatives. We believe the increased revenues reported for the current fiscal quarter are only beginning to reflect our progress toward our sales projections, which we anticipate will become more apparent by the end of our fiscal year ending June 30, 2008. </P>
<P style="margin:0px; text-indent:48px">Although we believe that we will successfully implement our business plan to provide for additional revenues to offset operating costs, management cannot give any assurances that it will be able to do so or that we will ever operate profitably.&nbsp; Our business plan assumes, among other things, that&nbsp;our revenues will increase from the sale of the new product lines, our material cost will remain constant or decrease, our expense from operations will continue at a rate similar to the rate we experienced for&nbsp;nine month period ended&nbsp;March&nbsp;31, 2008,&nbsp;and that we will&nbsp;increase&nbsp;our product pricing.&nbsp;&nbsp;&nbsp;Until such time as our net income exceeds our expense from operation,&nbsp;it is possible that we may need additional capital.&nbsp;If necessary, we may seek to raise additional capital through the issuance of debt or equity securities. Our ability to obtain financing through the offer and sale of our securities is subject to market conditions and other factors beyond our control.&nbsp;If we do seek additional capital, we cannot assure you that we will be able to obtain financing on favorable terms or at all.</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:6.667px"><I>Off-Balance Sheet Arrangements</I></P>
<P style="margin-top:0px; margin-bottom:6.667px; text-indent:48px">We do not currently have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes. In addition, we do not engage in trading activities involving non-exchange traded contracts. </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:13.333px"><B>Recent Accounting Pronouncements</B></P>
<P style="margin:0px; text-indent:48px">In June 2006, the FASB issued FASB Interpretation No. 48 (&#147;FIN 48&#148;), <I>Accounting for Uncertainty in Income Taxes, an Interpretation of FASB Statement No. 109,&#148; </I>which deals with the accounting for uncertainty in </P>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px" align=center>20</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always">income taxes. &nbsp;FIN 48 was effective for the fiscal year beginning January 1, 2007. &nbsp;As a result of our history of operating losses, the effects of FIN 48, if any, will be solely on our income tax-related disclosures and, therefore, we do not expect that it will have a material impact on our financial position, results of operations or cash flows for the immediate future.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; text-indent:48px">In September 2006, Statement of Financial Accounting Standards (&#147;SFAS&#148;) No. 157, <I>Fair Value Measurements&nbsp; </I>(&#147;SFAS 157&#148;), defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (&#147;GAAP&#148;), and expands disclosures about fair value measurements. The Company adopted the provisions of SFAS 157 effective January 1, 2008. SFAS 157 does not have a material impact on our results of operations, financial position, or cash flows. </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">In February&nbsp;2007, the Financial Accounting Standards Board (&#147;FASB&#148;) issued SFAS No.&nbsp;159, <I>The Fair Value Option for Financial Assets and Financial Liabilities, including an amendment of FASB Statement No.&nbsp;115</I> (&#147;SFAS 159&#148;), which allows an entity the irrevocable option to elect fair value for the initial and subsequent measurement for certain financial assets and liabilities under an instrument-by-instrument election. Subsequent measurements for the financial assets and liabilities an entity elects to fair value will be recognized in earnings. SFAS 159 also establishes additional disclosure requirements. SFAS 159 is effective for fiscal years beginning after November&nbsp;15, 2007, with early adoption permitted provided that the entity also adopts SFAS 157. We have not yet determined the impact this standard will have on our financial statements.</P>
<P style="margin:0px; text-indent:48px">In December 2007, the FASB issued SFAS 141(R), <I>Business Combinations</I>, an amendment of SFAS 141, which provides additional guidance on business combinations including defining the acquirer, recognizing and measuring the identifiable assets acquired and the liabilities assumed, and any noncontrolling interest in the acquiree. &nbsp;Also in December 2007, the FASB issued SFAS 160, <I>Noncontrolling Interests in Consolidated Financial Statements</I>, which amended ARB 51, to establish accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. &nbsp;SFAS Nos. 141(R) and 160 are scheduled to become effective for us for financial statements issued for fiscal year 2009. &nbsp;We are currently evaluating the effects, if any, that these statements will have on our future financial position, results of operations and operating cash flows.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; text-indent:48px">In March&nbsp;2008, the Financial Accounting Standards Board (FASB) issued SFAS No.&nbsp;161, Disclosures about Derivative Instruments and Hedging Activities-an amendment of FASB Statement No.&nbsp;133 (&quot;SFAS No. 161&quot;). SFAS No. 161 changes the disclosure requirements for derivative instruments and hedging activities. Entities are required to provide enhanced disclosures about how and why an entity uses derivative instruments, how the instruments are accounted for under SFAS No. 133 and its related interpretations, and how the instruments and related hedged items affect an entity's financial position, financial performance, and cash flows. The guidance in SFAS No. 161 is effective for financial statements issued for fiscal years and interim periods beginning after November&nbsp;15, 2008 (fiscal year 2009 for the Company). The Company is currently evaluating the potential impact of the adoption of SFAS&nbsp;No. 161 on its disclosures in the Company's&nbsp;financial statements.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center>ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK</P>
<P style="margin:0px" align=center><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; text-indent:48px">We are exposed to changes in prevailing market interest rates affecting the return on our investments but do not consider this interest rate market risk exposure to be material to our financial condition or results of operations. &nbsp;We invest primarily in United States Treasury instruments with short-term (less than one year) maturities. &nbsp;The carrying amount of these investments approximates fair value due to the short-term maturities. &nbsp;Under our current policies, we do not use derivative financial instruments, derivative commodity instruments or other financial instruments to manage our exposure to changes in interest rates or commodity prices.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center>ITEM 4. CONTROLS AND PROCEDURES</P>
<P style="margin:0px" align=center><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; text-indent:48px">We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission&#146;s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no </P>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px" align=center>21</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always">matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; text-indent:48px">As required by SEC Rule 13a-15(b), an evaluation was performed under the supervision and with the participation of our management, including our principal executive officer and our principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this report. Based upon that evaluation, our management, including our principal executive officer and our principal financial officer, concluded that the design and operation of these disclosure controls and procedures were effective at the reasonable assurance level.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; text-indent:48px">There has been no change in our internal controls over financial reporting during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.</P>
<P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=center>PART II - OTHER INFORMATION</P>
<P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=center>ITEM 1. &nbsp;LEGAL PROCEEDINGS</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">None.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center>ITEM&nbsp;1A. RISK FACTORS<A NAME="Item1a_RiskFactors_084009"></A></P>
<P style="margin:0px"><B>&nbsp;</B></P>
<P style="margin:0px; text-indent:48px">For information regarding risk factors, see &#147;Part I. Item 1A. Risk Factors,&#148; in our Annual Report on Form 10-K for the year ended June 30, 2007. </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center>ITEM 2. &nbsp;UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">None.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center>ITEM 3. &nbsp;DEFAULTS UPON SENIOR SECURITIES</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">None.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center>ITEM 4. &nbsp;SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">None.</P>
<P style="margin:0px" align=center>ITEM 5. &nbsp;OTHER INFORMATION</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">None.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center>ITEM 6. &nbsp;EXHIBITS</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">Exhibit 31.01 - CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002. </P>
<P style="margin:0px">Exhibit 31.02 - CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002. </P>
<P style="margin:0px">Exhibit 32.01 - CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002.</P>
<P style="margin:0px">Exhibit 32.02 - CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002. </P>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px" align=center>22</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always"><BR></P>
<P style="margin:0px" align=center>SIGNATURES</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">Dated: May 9, 2008</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">AMERITYRE CORPORATION</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><U>/S/GARY N. BENNINGER</U></P>
<P style="margin:0px">Gary N. Benninger </P>
<P style="margin:0px">Chief Executive Officer</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><U>/S/ANDERS A. SUAREZ</U></P>
<P style="margin:0px">Anders A. Suarez</P>
<P style="margin:0px">Chief Financial Officer and </P>
<P style="margin:0px">Principal Accounting Officer</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px" align=center>23</P>
<P style="margin:0px"><BR></P>
</DIV></BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.1
<SEQUENCE>2
<FILENAME>fqmx311.htm
<DESCRIPTION>08MAR PRIN EXEC 302 CERT
<TEXT>
<!doctype html public "-//IETF//DTD HTML//EN">
<HTML>
<HEAD>
<TITLE>EXHIBIT 31</TITLE>
<META NAME="author" CONTENT="User">
<META NAME="date" CONTENT="05/07/2008">
</HEAD>
<BODY style="line-height:12pt; font-family:Times New Roman; font-size:10pt; color:#000000">
<DIV style="width:639.333px"><P style="margin:0px">EXHIBIT 31.01</P>
<P style="margin:0px">CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO </P>
<P style="margin:0px">SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">I, GARY N. BENNINGER, certify that: </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">1. </P>
<P style="margin:0px; text-indent:96px">I have reviewed this quarterly report on Form 10-Q of Amerityre Corporation for the quarter ended March 31, 2008;</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">2.</P>
<P style="margin:0px; text-indent:96px">Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">3.</P>
<P style="margin:0px; text-indent:96px">Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">4.</P>
<P style="margin:0px; text-indent:96px">The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have: </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">(a)</P>
<P style="margin:0px; text-indent:96px">designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">(b)</P>
<P style="margin:0px; text-indent:96px">designed such internal control over financial reporting or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">(c)</P>
<P style="margin:0px; text-indent:96px">presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on our evaluation; and </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">(d)</P>
<P style="margin:0px; text-indent:96px">disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">5.</P>
<P style="margin:0px; text-indent:96px">The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">(a)</P>
<P style="margin:0px; text-indent:96px">all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">(b)</P>
<P style="margin:0px; text-indent:96px">any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">Date: May 9, 2008</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">/S/ Gary N. Benninger</P>
<P style="margin:0px">Gary N. Benninger</P>
<P style="margin:0px">Chief Executive Officer</P>
<P style="margin:0px"><BR>
<BR></P>
</DIV></BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.2
<SEQUENCE>3
<FILENAME>fqmx312.htm
<DESCRIPTION>08MAR PRIN FIN 302 CERT
<TEXT>
<!doctype html public "-//IETF//DTD HTML//EN">
<HTML>
<HEAD>
<TITLE>EXHIBIT 31</TITLE>
<META NAME="author" CONTENT="User">
<META NAME="date" CONTENT="05/07/2008">
</HEAD>
<BODY style="line-height:12pt; font-family:Times New Roman; font-size:10pt; color:#000000">
<DIV style="width:639.333px"><P style="margin:0px">EXHIBIT 31.02</P>
<P style="margin:0px">CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO </P>
<P style="margin:0px">SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">I, ANDERS A. SUAREZ, certify that: </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">1. </P>
<P style="margin:0px; text-indent:96px">I have reviewed this quarterly report on Form 10-Q of Amerityre Corporation for the quarter ended March 31, 2008;</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">2.</P>
<P style="margin:0px; text-indent:96px">Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">3.</P>
<P style="margin:0px; text-indent:96px">Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">4.</P>
<P style="margin:0px; text-indent:96px">The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have: </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">(a)</P>
<P style="margin:0px; text-indent:96px">designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">(b)</P>
<P style="margin:0px; text-indent:96px">designed such internal control over financial reporting or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">(c)</P>
<P style="margin:0px; text-indent:96px">presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on our evaluation; and </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">(d)</P>
<P style="margin:0px; text-indent:96px">disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">5.</P>
<P style="margin:0px; text-indent:96px">The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">(a)</P>
<P style="margin:0px; text-indent:96px">all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and </P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">(b)</P>
<P style="margin:0px; text-indent:96px">any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">Date: &nbsp;May 9, 2008</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">/S/ Anders A. Suarez</P>
<P style="margin:0px">Anders A. Suarez</P>
<P style="margin:0px">Chief Financial Officer</P>
<P style="margin:0px"><BR>
<BR></P>
</DIV></BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32.1
<SEQUENCE>4
<FILENAME>fqmx321.htm
<DESCRIPTION>08MAR PRIN EXEC 906 CERT
<TEXT>
<!doctype html public "-//IETF//DTD HTML//EN">
<HTML>
<HEAD>
<TITLE>EXHIBIT 32</TITLE>
<META NAME="author" CONTENT="User">
<META NAME="date" CONTENT="05/07/2008">
</HEAD>
<BODY style="line-height:12pt; font-family:Times New Roman; font-size:10pt; color:#000000">
<DIV style="width:640.133px"><P style="margin:0px">EXHIBIT 32.01</P>
<P style="margin:0px">CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">In connection with the Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of Amerityre Corporation (the &quot;Company&quot;) on Form 10-Q for the quarter ended March 31, 2008, as filed with the Securities and</P>
<P style="margin:0px">Exchange Commission on the date hereof (the &quot;Report&quot;), I, Gary N. Benninger, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge and belief:</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px">&nbsp;</P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">(1)</P>
<P style="margin:0px; text-indent:96px">the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">(2)</P>
<P style="margin:0px; text-indent:96px">the information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">/S/ Gary N. Benninger</P>
<P style="margin:0px">Gary N. Benninger</P>
<P style="margin:0px">Chief Executive Officer</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">May 9, 2008</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR>
<BR></P>
</DIV></BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32.2
<SEQUENCE>5
<FILENAME>fqmx322.htm
<DESCRIPTION>08MAR PRIN FIN 906 CERT
<TEXT>
<!doctype html public "-//IETF//DTD HTML//EN">
<HTML>
<HEAD>
<TITLE>EXHIBIT 32</TITLE>
<META NAME="author" CONTENT="User">
<META NAME="date" CONTENT="05/07/2008">
</HEAD>
<BODY style="line-height:12pt; font-family:Times New Roman; font-size:10pt; color:#000000">
<DIV style="width:640.133px"><P style="margin:0px">EXHIBIT 32.02</P>
<P style="margin:0px">CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">In connection with the Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of Amerityre Corporation (the &quot;Company&quot;) on Form 10-Q for the quarter ended March 31, 2008, as filed with the Securities and</P>
<P style="margin:0px">Exchange Commission on the date hereof (the &quot;Report&quot;), I, Anders A. Suarez, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge and belief:</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">(1)</P>
<P style="margin:0px; text-indent:96px">the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and</P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; text-indent:48px">(2)</P>
<P style="margin:0px; text-indent:96px">the information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">/S/ Anders A. Suarez</P>
<P style="margin:0px">Anders A. Suarez</P>
<P style="margin:0px">Chief Financial Officer</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">May 9, 2008</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR>
<BR></P>
</DIV></BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>GRAPHIC
<SEQUENCE>6
<FILENAME>amty08mar10qfinal001.jpg
<DESCRIPTION>AMTY LOGO
<TEXT>
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