<HTML>
<HEAD>
<TITLE>KCI 10-Q First Qtr. 2000 </TITLE>
</HEAD>
<B><FONT FACE="Verdana" SIZE=5><P ALIGN="CENTER">UNITED STATES</P>
<P ALIGN="CENTER">SECURITIES AND EXCHANGE COMMISSION </P>
</FONT><FONT FACE="Verdana" SIZE=2><P ALIGN="CENTER">Washington, D.C. 20549</P>
<P ALIGN="CENTER"> </P>
</FONT><FONT FACE="Verdana" SIZE=6><P ALIGN="CENTER">Form 10-Q</P>
</FONT><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(Mark One)</P><DIR>
<DIR>
</B><P>[X]	<B>QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES	EXCHANGE ACT OF 1934 </P>
</B><P>For the Quarterly period ended March 31, 2000</P>
<P>[ ]	<B>TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES	EXCHANGE ACT OF 1934 </P>
</B><P>For the transition period from _____________ to ___________</P></DIR>
</DIR>
<P>									</P>
<P ALIGN="CENTER">Commission file number 1-9913</P>
</FONT><U><FONT FACE="Verdana" SIZE=6 COLOR="#4682B4"><P ALIGN="CENTER">KINETIC CONCEPTS, INC. </P>
</U></FONT><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(Exact name of registrant as specified in its charter)</P>
</FONT><FONT FACE="Verdana" SIZE=2><P ALIGN="CENTER"> </P></FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 WIDTH=256>
<TR><TD WIDTH="45%" VALIGN="TOP">
<P ALIGN="CENTER"><B><FONT FACE="Verdana" SIZE=1>Texas</B></FONT></TD>
<TD WIDTH="55%" VALIGN="TOP">
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">74-1891727</B></FONT></TD>
</TR>
<TR><TD WIDTH="45%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(State of Incorporation)</FONT></TD>
<TD WIDTH="55%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(I.R.S. Employer Identification No.)</FONT></TD>
</TR>
</CENTER></P>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">8023 Vantage Drive<BR>
San Antonio, Texas 78230<BR>
Telephone Number: (210) 524-9000<BR>
</B>(Address, including zip code, and telephone number, including area code,<BR>
of registrant's principal executive offices)</P>
<P ALIGN="CENTER"> </P>
<P ALIGN="JUSTIFY">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.	Yes<U> X </U> No ___</P>
<P>Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.</P>
<P ALIGN="CENTER">Common Stock: 70,915,008 shares as of March 1, 2000</P>
<P ALIGN="CENTER"> </P>
</FONT><P><HR></P>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">PART I - FINANCIAL INFORMATION</P>
<U><P>ITEM 1.</U> <U>FINANCIAL STATEMENTS</P>
</B></U></FONT><FONT FACE="Verdana" SIZE=2><P> </P></FONT>
<TABLE CELLSPACING=0 BORDER=0 WIDTH=623>
<TR><TD VALIGN="TOP" COLSPAN=14 HEIGHT=17>
<P ALIGN="CENTER"><B><FONT FACE="Verdana" SIZE=1>KINETIC CONCEPTS, INC. AND SUBSIDIARIES</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=14 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Condensed Consolidated Balance Sheets</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=14 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(in thousands) </B></FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">March 31, </B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">December 31, </B></FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2000 </B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1999 </B></FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(unaudited) </B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P>ASSETS:</B></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>Current assets:</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Cash and cash equivalents</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 8,384 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 7,362 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Accounts receivable, net</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">80,588 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">79,508 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Inventories, net</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">22,193 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">21,955 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Prepaid expenses and other current assets</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">10,089 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">10,142 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Total current assets</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">121,254 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">118,967 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>Net property, plant and equipment</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">70,440 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">74,068 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>Loan issuance cost, less accumulated amortization</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> of $5,581 in 2000 and $5,002 in 1999</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">12,655 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">13,234 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>Goodwill, less accumulated amortization of $21,478</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> in 2000 and $20,559 in 1999</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">51,382 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">52,300 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>Other assets, less accumulated amortization of</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> $4,287 in 2000 and $4,152 in 1999</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">25,313 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">24,692 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=18><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=18>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 281,044 </B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=18><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=18>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 283,261 </B></FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P>LIABILITIES AND SHAREHOLDERS' DEFICIT:</B></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>Current liabilities:</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Accounts payable</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 4,370 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 2,787 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Accrued expenses</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">39,093 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">34,400 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Current installments of long-term obligations</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">21,312 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">16,800 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Current installments of capital lease obligations</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">100 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">67 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Income taxes payable</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3,231 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,431 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Total current liabilities</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">68,106 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">56,485 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>Long-term obligations, net of current installments</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">472,009 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">486,075 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>Capital lease obligations, net of current installments</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">346 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">313 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>Deferred income taxes, net</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4,955 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">5,123 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">545,416 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">547,996 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>Shareholders' deficit:</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Common stock; issued and outstanding 70,915</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> in 2000 and in 1999</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">71 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">71 </FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Retained deficit</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(257,968)</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(259,435)</FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Accumulated other comprehensive loss</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(6,475)</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(5,371)</FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(264,372)</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(264,735)</FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP" COLSPAN=2 HEIGHT=18><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=18>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 281,044 </B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=3 HEIGHT=18><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=5 HEIGHT=18>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 283,261 </B></FONT></TD>
</TR>
<FONT FACE="Verdana" SIZE=1><P>See accompanying notes to condensed consolidated financial statements.
</P>
<B><P ALIGN="CENTER">2</P>
</B></FONT><P><HR COLOR=#4682B4></P>
<B><U><FONT FACE="Verdana" SIZE=1><P>ITEM 1.</U> <U>FINANCIAL STATEMENTS (continued)</P>
</B></U></FONT><FONT FACE="Verdana" SIZE=2><P> </P></FONT>
<TABLE CELLSPACING=0 BORDER=0 WIDTH=616>
<TR><TD VALIGN="TOP" COLSPAN=17 HEIGHT=16>
<P ALIGN="CENTER"><B><FONT FACE="Verdana" SIZE=1>KINETIC CONCEPTS, INC. AND SUBSIDIARIES</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=17 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Condensed Consolidated Statements of Earnings</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=17 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(in thousands, except per share data)</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=17 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(unaudited)</B></FONT></TD>
</TR>
<TR><TD WIDTH="36%" VALIGN="TOP" COLSPAN=3 ROWSPAN=2 HEIGHT=16><P></P></TD>
<TD WIDTH="64%" VALIGN="TOP" COLSPAN=14 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">Three months ended </B></FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="TOP" COLSPAN=14 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">March 31, </B></FONT>
</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2000 </B></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1999 </B></FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Revenue:</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Rental and service</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 65,310 </FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 62,515 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Sales and other</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">17,392 </FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">17,696 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Total revenue</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">82,702 </B></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">80,211 </B></FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Rental expenses</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">42,243 </FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">43,037 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Cost of goods sold</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">7,189 </FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">7,199 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">49,432 </FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">50,236 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Gross profit</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">33,270 </B></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">29,975 </B></FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Selling, general and administrative expenses</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">18,126 </FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">15,500 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Operating earnings</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">15,144 </B></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">14,475 </B></FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Interest income</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">512 </FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">111 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Interest expense</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(12,735)</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(11,667)</FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Foreign currency loss</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(433)</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(357)</FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Earnings before income taxes</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,488 </B></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,562 </B></FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Income taxes</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,020 </FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,025 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Net earnings</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 1,468 </B></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 1,537 </B></FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P> Earnings per common share</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 0.02 </B></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 0.02 </B></FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P> Earnings per common share --</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P> assuming dilution</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 0.02 </B></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 0.02 </B></FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Average common shares:</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Basic (weighted average outstanding shares)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">70,915 </FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">70,915 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP" COLSPAN=4 HEIGHT=18>
<FONT FACE="Verdana" SIZE=1><P> Diluted (weighted average outstanding shares)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=18>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">73,245 </FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=4 HEIGHT=18><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=6 HEIGHT=18>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">73,177 </FONT></TD>
</TR>
<FONT FACE="Verdana" SIZE=1><P>See accompanying notes to condensed consolidated financial statements.
</P>
<B><P ALIGN="CENTER">3</P>
</B></FONT><P><HR COLOR=#4682B4></P>
<B><U><FONT FACE="Verdana" SIZE=1><P>ITEM 1.</U> <U>FINANCIAL STATEMENTS (continued)</P></B></U></FONT>
<TABLE CELLSPACING=0 BORDER=0 WIDTH=709>
<TR><TD VALIGN="TOP" COLSPAN=12 HEIGHT=16>
<P ALIGN="CENTER"><B><FONT FACE="Verdana" SIZE=1>KINETIC CONCEPTS, INC. AND SUBSIDIARIES</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=12 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Condensed Consolidated Statements of Cash Flows</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=12 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(in thousands)</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=12 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(unaudited)</B></FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="46%" VALIGN="TOP" COLSPAN=8 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">Three months ended </B></FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="46%" VALIGN="TOP" COLSPAN=8 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">March 31, </B></FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2000 </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1999 </B></FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P>Cash flows from operating activities:</B></FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Net earnings</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 1,468 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 1,537 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Adjustments to reconcile net earnings to net cash</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> provided by operating activities:</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Depreciation</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">7,075 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">6,634 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Amortization</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,632 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,532 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Provision for uncollectible accounts receivable</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">942 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">554 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Change in assets and liabilities net of effects from</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> purchase of subsidiaries and unusual items:</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Increase in accounts receivable, net</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(2,280)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(2,653)</FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Increase in inventories</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(364)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(983)</FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Decrease (increase) in prepaid expenses and other</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">53 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,208)</FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Increase (decrease) in accounts payable</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,500 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(625)</FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Increase in accrued expenses</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4,589 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3,835 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Increase in income taxes payable</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,528 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">693 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Increase (decrease) in deferred income taxes, net</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(896)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">590 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Net cash provided by operating activities</B></FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">15,247 </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">9,906 </B></FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P>Cash flows from investing activities:</B></FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Additions to property, plant and equipment</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(4,547)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(6,485)</FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Decrease in inventory to be converted into equipment </FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> for short-term rental</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">500 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">100 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Dispositions of property, plant and equipment</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">476 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">461 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Business acquired in purchase transactions,</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> net of cash acquired</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(797)</FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Decrease (increase) in other assets</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(757)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">6,382 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Net cash used by investing activities</B></FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(4,328)</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(339)</B></FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P>Cash flows from financing activities:</B></FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Repayment of notes payable and long-term obligations</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(9,554)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(5,872)</FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Borrowing (repayment) of capital lease obligations</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">67 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(51)</FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Net cash used by financing activities</B></FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(9,487)</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(5,923)</B></FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Effect of exchange rate changes on cash</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> and cash equivalents</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(410)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(347)</FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P>Net increase in cash and cash equivalents</B></FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,022 </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3,297 </B></FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P>Cash and cash equivalents, beginning of period</B></FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">7,362 </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4,366 </B></FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P>Cash and cash equivalents, end of period</B></FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 8,384 </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 7,663 </B></FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Supplemental disclosure of cash flow information:</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Cash paid during the first three months for:</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Interest</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 6,450 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 5,858 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Income taxes</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 1,073 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 1,398 </FONT></TD>
</TR>
<FONT FACE="Verdana" SIZE=1><P>See accompanying notes to condensed consolidated financial statements.
</P>
<B><P ALIGN="CENTER">4</P>
</B></FONT><P><HR COLOR=#4682B4></P>
<B><U><FONT FACE="Verdana" SIZE=1><P>ITEM 1.</U> <U>FINANCIAL STATEMENTS (continued)</P>
</U><P ALIGN="CENTER">KINETIC CONCEPTS, INC. AND SUBSIDIARIES<BR>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS<BR>
(unaudited)</P>
<P>(1) <U>BASIS OF PRESENTATION</P><DIR>
<DIR>
</B></U><P ALIGN="JUSTIFY"> The financial statements presented herein include the accounts of Kinetic Concepts, Inc. and all subsidiaries (the "Company"). The condensed consolidated financial
statements appearing in this quarterly report on Form 10-Q should be read in conjunction with the financial statements and notes thereto included in the Company's latest annual report on Form 10-K. Certain information and footnote disclosures normally
included
</DIR>
<B><P ALIGN="JUSTIFY">(2) <U>INVENTORY COMPONENTS</P><DIR>
<DIR>
</B></U><P> Inventories are stated at the lower of cost (first-in, first-out) or market (net realizable value). Inventories are comprised of the following (in thousands):</P></DIR>
</DIR>
</FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 WIDTH=435>
<TR><TD WIDTH="55%" VALIGN="TOP" HEIGHT=15>
<P></TD>
<TD WIDTH="19%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">March 31,</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">December 31,</B></FONT></TD>
</TR>
<TR><TD WIDTH="55%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="19%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2000 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1999 </B></FONT></TD>
</TR>
<TR><TD WIDTH="55%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Finished goods</FONT></TD>
<TD WIDTH="19%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 7,530 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 8,549 </FONT></TD>
</TR>
<TR><TD WIDTH="55%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Work in process</FONT></TD>
<TD WIDTH="19%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,495 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,566 </FONT></TD>
</TR>
<TR><TD WIDTH="55%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Raw materials, supplies and parts</FONT></TD>
<TD WIDTH="19%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">19,468 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">19,640 </FONT></TD>
</TR>
<TR><TD WIDTH="55%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="19%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">29,493 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">29,755 </FONT></TD>
</TR>
<TR><TD WIDTH="55%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Less amounts expected to be</FONT></TD>
<TD WIDTH="19%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="55%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> converted into equipment for</FONT></TD>
<TD WIDTH="19%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="55%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> short-term rental</FONT></TD>
<TD WIDTH="19%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(7,300)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(7,800)</FONT></TD>
</TR>
<TR><TD WIDTH="55%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Total Inventories</FONT></TD>
<TD WIDTH="19%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 22,193 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 21,955 </FONT></TD>
</TR>
</CENTER></P>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">(3) <U>LONG-TERM OBLIGATIONS</P><DIR>
<DIR>
</B></U><P> Long-term obligations consist of the following (in thousands):</P></DIR>
</DIR>
</FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 WIDTH=433>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=15>
<P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">March 31,</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">December 31,</B></FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2000 </B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1999 </B></FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Senior Credit Facilities:</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Revolving bank credit facility</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 1,500 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 6,000 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Acquisition credit facility</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">9,146 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">10,000 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Term loans:</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Tranche A due 2003</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">106,250 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">110,000 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Tranche B due 2004</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">87,975 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">88,200 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Tranche C due 2005</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">87,975 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">88,200 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">292,846 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">302,400 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>9 5/8% Senior Subordinated Notes</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Due 2007</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">200,000 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">200,000 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">492,846 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">502,400 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Less: Current installments</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(21,312)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(16,800)</FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">471,534 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">485,600 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Other</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">475 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">475 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 472,009 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 486,075 </FONT></TD>
</TR>
</CENTER></P>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">5</P>
</B></FONT><P><HR COLOR=#4682B4></P>
<B><U><FONT FACE="Verdana" SIZE=1><P>ITEM 1.</U> <U>FINANCIAL STATEMENTS (continued)</P>
</U><P ALIGN="CENTER">KINETIC CONCEPTS, INC. AND SUBSIDIARIES<BR>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS<BR>
(unaudited)</P>
<P ALIGN="JUSTIFY">(3) <U>LONG TERM OBLIGATIONS (continued)</P><DIR>
<DIR>
</B></U><P ALIGN="JUSTIFY"> In November 1999, in anticipation of a potential default on its Interest Coverage, Minimum EBITDA and Leverage Ratio Covenants at December 31, 1999 due to the decline
in extended care rental revenue, the Company requested its Senior Lenders to waive these covenants for the period from December 31, 1999 to and including February 29, 2000. On November 30, 1999 the Lenders approved this waiver and amended certain other prov
i
<I><P ALIGN="JUSTIFY">Senior Credit Facilities</P>
</I><P ALIGN="JUSTIFY"> Indebtedness under the Senior Credit Facilities, as amended, including the Revolving Credit Facility (other than certain loans under the Revolving Credit Facility
designated in foreign currency), the Term Loans and the Acquisition Facility initially bear interest at a rate based upon (i) the Base Rate (defined as the higher of (x) the rate of interest publicly announced by Bank of America as its "reference rate" or
(y) the fe
e on 84% of the Company's variable rate debt as follows (dollars in millions):</P></DIR>
</DIR>
</FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 WIDTH=353>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P><FONT FACE="Verdana"> </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Fixed Base </B></FONT></TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Swap </B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Interest </B></FONT></TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Maturity </B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Amount </B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Rate </B></FONT></TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">01/08/2002 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$150.0 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">5.5775% </FONT></TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">12/29/2000 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="23%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT"> $ 95.0 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="30%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">4.8950% </FONT></TD>
</TR>
</CENTER></P>
<DIR>
<DIR>
<FONT FACE="Verdana" SIZE=2><P ALIGN="JUSTIFY"> </FONT><FONT FACE="Verdana" SIZE=1>As a result of the interest rate protection agreements, the Company recorded an interest expense benefit of
approximately $490,000 in the first quarter of 2000 as compared to additional net interest expense of approximately $168,000 in the first quarter of 1999. The fair value of these agreements at March 31, 2000 is approximately $4.8 million.</P>
<P ALIGN="JUSTIFY"> The Revolving Loans may be repaid and reborrowed. At March 31, 2000, the aggregate availability under the Revolving Credit facility was $45.2 million.</P>
<P ALIGN="JUSTIFY"> The Term Loans are subject to quarterly amortization payments which began on March 31, 1998. On February 17, 2000, commitments under the Acquisition Facility were cancelled as
part of the third </P>
<B><P ALIGN="CENTER">6</P></DIR>
</DIR>
</B></FONT><P><HR COLOR=#4682B4></P>
<B><U><FONT FACE="Verdana" SIZE=1><P>ITEM 1.</U> <U>FINANCIAL STATEMENTS (continued)</P>
</U><P ALIGN="CENTER">KINETIC CONCEPTS, INC. AND SUBSIDIARIES<BR>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS<BR>
(unaudited)</P>
<P ALIGN="JUSTIFY">(3) <U>LONG TERM OBLIGATIONS (continued)</P><DIR>
<DIR>
</B></U><P ALIGN="JUSTIFY">amendment to the Credit Agreement discussed previously. The Acquisition Facility loans outstanding shall be repaid in equal quarterly payments commencing March 31, 2001. In addition, the Senior Credit Agreement provides for
mandatory repayments, subject to certain exceptions, of the Term Loans, the Acquisition Facility and/or the Revolving Credit Facility based on certain net asset sales outside the ordinary course of business of the Company and its subsidiaries, the net
proceeds
<P ALIGN="JUSTIFY"> Indebtedness of the Company under the Senior Credit Agreement is guaranteed by certain of the subsidiaries of the Company and is secured by (i) a first priority security
interest in all, subject to certain customary exceptions, of the tangible and intangible assets of the Company and its domestic subsidiaries, including, without limitation, intellectual property and real estate owned by the Company and its subsidiaries,
(ii) a fi
<P ALIGN="JUSTIFY"> The Senior Credit Agreement requires the Company to meet certain financial tests, including minimum levels of EBITDA (as defined therein), minimum interest coverage, maximum
leverage ratio and capital expenditures. The Senior Credit Agreement also contains covenants which, among other things, limit the incurrence of additional indebtedness, investments, dividends, loans and advances, capital expenditures, transactions with
affili
<I><P ALIGN="JUSTIFY">9 5/8% Senior subordinated Notes Due 2007</P>
</I><P ALIGN="JUSTIFY"> The 9 5/8% Senior Subordinated Notes Due 2007 (the "Notes") are unsecured obligations of the Company, ranking subordinate in right of payment to all senior debt of the
Company and will mature on November 1, 2007. Interest on the Notes accrues at the rate of 9 5/8% per annum and is payable semiannually in cash on each May 1 and November 1, commencing on May 1, 1998, to the persons who are registered Holders at the close
of bus
<P ALIGN="JUSTIFY"> The Notes are not entitled to the benefit of any mandatory sinking fund. In addition, at any time, or from time to time, the Company may acquire a portion of the Notes through
open-market purchases.</P>
<B><P ALIGN="CENTER">7</P></DIR>
</DIR>
</B></FONT><P><HR COLOR=#4682B4></P>
<B><U><FONT FACE="Verdana" SIZE=1><P>ITEM 1.</U> <U>FINANCIAL STATEMENTS (continued)</P>
</U><P ALIGN="CENTER">KINETIC CONCEPTS, INC. AND SUBSIDIARIES<BR>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS<BR>
(unaudited)</P>
<P>(4) <U>EARNINGS PER SHARE</P><DIR>
<DIR>
</B></U><P ALIGN="JUSTIFY"> The following table sets forth the reconciliation from basic to diluted average common shares and the calculations of net earnings per common share. Net earnings for
basic and diluted calculations do not differ (in thousands, except per share):</P></DIR>
</DIR>
</FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 WIDTH=525>
<TR><TD WIDTH="70%" VALIGN="TOP" HEIGHT=16>
<P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="27%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Three months ended</B></FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="27%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">March 31,</B></FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">2000</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">1999</B></FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>Net earnings</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 1,468 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 1,537 </FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>Average common shares:</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Basic(weighted-average outstanding shares) </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">70,915 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">70,915 </FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Dilutive potential common shares from stock options</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,330 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,262 </FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Diluted (weighted-average outstanding shares)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">73,245 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">73,177 </FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>Earnings per common share</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 0.02 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 0.02 </FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>Earnings per common share - assuming dilution</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 0.02 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 0.02 </FONT></TD>
</TR>
</CENTER></P>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY"> </P>
<P ALIGN="JUSTIFY">(5) <U>COMMITMENTS AND CONTINGENCIES</P><DIR>
<DIR>
</B></U><P ALIGN="JUSTIFY"> The Company is a party to several lawsuits generally incidental to its business. Certain provisions have been made in the accompanying financial statements for
estimated exposures related to these lawsuits. In the opinion of management, the disposition of these items will not have a material effect on the Company's financial statements. </P>
<P ALIGN="JUSTIFY"> Other than commitments for new product inventory, including disposable "for sale" products, of $1.9 million, the Company has no material long-term capital commitments and can
adjust the level of capital expenditures as circumstances warrant.</P></DIR>
</DIR>
<B><P>(6) <U>OTHER COMPREHENSIVE INCOME</P><DIR>
<DIR>
</B></U><P ALIGN="JUSTIFY"> The Company adopted Financial Accounting Standards Board ("FASB") Statement No. 130, "Reporting Comprehensive Income", in the first quarter of 1998. The adoption
of this Statement has had no impact on the net earnings or shareholders' equity (deficit) of the Company. This standard requires disclosure of total non-owner changes in shareholders' equity, which is defined as net earnings plus direct adjustments to share
as equity and cash investment adjustments and foreign currency translation adjustments. The components of other comprehensive income are as follows (in thousands): </P></DIR>
</DIR>
</FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 WIDTH=348>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=16>
<P></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="42%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Three months ended</B></FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="42%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">March 31,</B></FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">2000</B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">1999</B></FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Net earnings</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 1,468 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 1,537 </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Foreign currency translation </FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> adjustment</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,104) </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,144) </FONT></TD>
</TR>
<TR><TD WIDTH="54%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>Other comprehensive income</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 364 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 393 </FONT></TD>
</TR>
</CENTER></P>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER"> </P><DIR>
<DIR>
<P ALIGN="CENTER">8</P></DIR>
</DIR>
</B></FONT><P><HR COLOR=#4682B4></P>
<B><U><FONT FACE="Verdana" SIZE=1><P>ITEM 1.</U> <U>FINANCIAL STATEMENTS (continued)</P>
</U><P ALIGN="CENTER">KINETIC CONCEPTS, INC. AND SUBSIDIARIES<BR>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS<BR>
(unaudited)</P>
<P ALIGN="JUSTIFY">(6) <U>OTHER COMPREHENSIVE INCOME (continued)</P><DIR>
<DIR>
</B></U><P ALIGN="JUSTIFY"> The earnings associated with the Company's investment in its foreign subsidiaries are considered to be permanently invested and no provision for U.S. Federal and
State income taxes on these earnings or translation adjustments has been made.</P></DIR>
</DIR>
<B><P ALIGN="JUSTIFY">(7) <U>SEGMENT AND GEOGRAPHIC INFORMATION</P><DIR>
<DIR>
</B></U><P ALIGN="JUSTIFY"> The Company is principally engaged in the sale and rental of innovative therapeutic systems throughout the United States and in twelve primary countries
internationally. In June 1997, the FASB issued Statement No. 131 "Disclosures about Segments of an Enterprise and Related Information".</P>
<P ALIGN="JUSTIFY"> The Company identifies its business segments based on management responsibility within the United States and geographically for all international units. As of August 1, 1999,
KCI New Technologies, Inc. ("NuTech") merged into KCI Licensing, which transferred NuTech's assets to KCI Therapeutic Services ("KCI USA"). The Company measures segment profit as operating profit, which is defined as income before interest income or expense
,
</DIR>
</FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 WIDTH=300>
<TR><TD WIDTH="47%" VALIGN="TOP" HEIGHT=16>
<P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="48%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Three months ended</B></FONT></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="48%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">March 31,</B></FONT></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">2000</B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">1999</B></FONT></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Revenue:</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> KCI USA</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">61,009 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">58,910 </FONT></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> KCI International </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">21,329 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">21,146 </FONT></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Other (1)</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">364 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">155 </FONT></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">82,702 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">80,211 </FONT></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>Operating Earnings:</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> KCI USA</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">20,271 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">16,991 </FONT></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> KCI International </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4,126 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4,076 </FONT></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Other (2)</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(9,253)</FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(6,592)</FONT></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">15,144 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">14,475 </FONT></TD>
</TR>
</CENTER></P>
<FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER"> </P>
<P> (1) Other revenue consists primarily of contract metal fabrication
income.</P>
<P> (2) General headquarter expenses are not allocated to the
individual segments and <BR>
<P> include executive, financial, legal
and administrative expenses.</P>
<P> </P>
<B><P ALIGN="JUSTIFY">(8) <U>NEW ACCOUNTING PRONOUNCEMENTS</P><DIR>
<DIR>
</B></U><P ALIGN="JUSTIFY"> In June 1998, the Financial Accounting Standards Board ("FASB") issued Statement No. 133, Accounting for Derivative Instruments and Hedging Activities. In June
1999, FASB Statement No. 133 was amended by FASB Statement No. 137, Accounting for Derivative Instruments and Hedging Activities - Deferral of the effective date of FASB Statement No. 133 and is effective for years beginning after June 15, 2000. The
Company e
<B><P ALIGN="CENTER">9</P></DIR>
</DIR>
</B></FONT><P><HR COLOR=#4682B4></P>
<B><U><FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">ITEM 1.</U> <U>FINANCIAL STATEMENTS (continued)</P>
</U><P ALIGN="CENTER">KINETIC CONCEPTS, INC. AND SUBSIDIARIES<BR>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS<BR>
(unaudited)</P>
<P ALIGN="JUSTIFY">(9) <U>GUARANTOR CONDENSED CONSOLIDATING FINANCIAL STATEMENTS</P><DIR>
<DIR>
</B></U><P ALIGN="JUSTIFY"> In November 1997, the Company issued $200 million in subordinated debt securities to finance a tender offer to purchase certain of its outstanding common shares. In
connection with the issuance of these securities, certain of its subsidiaries (the "guarantor subsidiaries") serve as guarantors. Certain other subsidiaries (the "nonguarantor subsidiaries") do not guarantee any Company debt.</P>
<P ALIGN="JUSTIFY"> The following tables present the condensed consolidating balance sheets of Kinetic Concepts, Inc. as a parent company, its guarantor subsidiaries and its non-guarantor
subsidiaries as of March 31, 2000 and December 31, 1999 and the related condensed consolidating statements of earnings and cash flows for the three month periods ended March 31, 2000 and 1999.</P>
<B><P ALIGN="CENTER">10</P></DIR>
</DIR>
</B></FONT><P><HR COLOR=#4682B4></P>
<TABLE CELLSPACING=0 BORDER=0 WIDTH=650>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<P ALIGN="CENTER"><B><FONT FACE="Verdana" SIZE=1>Condensed Consolidating Guarantor, Non-Guarantor and</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Parent Company Balance Sheet</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">March 31, 2000</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(in thousands)</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(unaudited)</B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Kinetic</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Concepts,</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Reclassi-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Kinetic</B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Inc.</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Non-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">fications</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Concepts,</B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Parent</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Guarantor</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Guarantor</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">and</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Inc.</B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Company</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Sub-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Sub-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Elimi-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">and Sub-</B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Borrower</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Sidiaries</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">nations</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P>ASSETS</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Current assets:</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Cash and cash equivalents</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">9,545 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,161)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">8,384 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Accounts receivable, net</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">69,314 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">18,227 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(6,953)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">80,588 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Inventories, net</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">13,288 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">8,905 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">22,193 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Prepaid expenses and other</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> current assets</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">5,553 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4,741 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(205)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">10,089 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Total current assets</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">88,155 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">41,418 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(8,319)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">121,254 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Net property, plant and</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>equipment</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">73,116 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">8,866 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(11,542)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">70,440 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Loan issuance cost, net</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">12,655 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">12,655 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Goodwill, net</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">46,539 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4,843 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">51,382 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Other assets, net</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">24,965 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">348 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">25,313 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Intercompany investments </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> and advances</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(264,372)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">473,181 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">5,073 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(213,882)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P> Total assets</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(264,372)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">718,611 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">60,548 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(233,743)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">281,044 </B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P>LIABILITIES AND SHARE-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P>HOLDER'S EQUITY (DEFICIT) </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Accounts payable</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3,143 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,388 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,161)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4,370 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Accrued expenses</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">31,746 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">7,347 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">39,093 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Current installments on long-</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> term obligations</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">21,312 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">21,312 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Intercompany payables</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">11,775 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(11,775)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Current installments of capital</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> lease obligations</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">100 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">100 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Income tax payable</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3,436 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(205)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3,231 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Total current liabilities</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">68,076 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">13,171 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(13,141)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">68,106 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Long-term obligations </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> excluding current installments</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">472,009 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">472,009 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Capital lease obligations, </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> excluding current installments</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">346 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">346 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Deferred income taxes, net</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">15,040 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(10,085)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4,955 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Total liabilities</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">555,471 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">13,171 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(23,226)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">545,416 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Shareholders' equity (deficit)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(264,372)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">163,140 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">47,377 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(210,517)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(264,372)</FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P>Total liabilities and equity</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P> (deficit)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(264,372)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">718,611 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">60,548 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(233,743)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">281,044 </B></FONT></TD>
</TR>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">11</P>
</B></FONT><P><HR COLOR=#4682B4></P>
<TABLE CELLSPACING=0 BORDER=0 WIDTH=618>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<P ALIGN="CENTER"><B><FONT FACE="Verdana" SIZE=1>Condensed Consolidating Guarantor, Non-Guarantor and</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Parent Company Balance Sheet</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">December 31, 1999</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(in thousands)</B></FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Kinetic</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Concepts,</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Reclassi-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Kinetic</B></FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Inc.</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Non-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">fications</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Concepts,</B></FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Parent</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P>Guarantor</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=2 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P>Guarantor</B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">and</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Inc.</B></FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Company</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Sub-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Sub-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Elimi-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">and Sub-</B></FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Borrower</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">nations</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P>ASSETS</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Current assets:</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Cash and cash equivalents</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">9,879 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(2,517)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">7,362 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Accounts receivable, net</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">66,162 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">17,502 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(4,156)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">79,508 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Inventories, net</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">12,873 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">9,082 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">21,955 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Prepaid expenses and other</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> current assets</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">6,521 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4,056 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(435)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">10,142 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Total current assets</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">85,556 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">40,519 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(7,108)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">118,967 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Net property, plant and</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> equipment</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">76,234 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">9,151 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(11,317)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">74,068 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Loan issuance cost, net</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">13,234 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">13,234 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Goodwill, net</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">47,332 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4,968 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">52,300 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Other assets, net</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">24,549 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">143 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">24,692 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Intercompany investments </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> and advances</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(264,736)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">469,263 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4,120 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(208,647)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P> Total assets</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(264,736)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">716,168 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">58,901 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(227,072)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">283,261 </B></FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P>LIABILITIES AND SHARE-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P>HOLDER'S EQUITY (DEFICIT) </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Accounts payable</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3,127 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,179 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(2,519)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,787 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Accrued expenses</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">26,569 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">7,831 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">34,400 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Current installments on long-</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> term obligations</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">16,800 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">16,800 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Intercompany payables</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">7,295 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(7,295)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Current installments of </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> capital lease obligations</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">67 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">67 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Income tax payable</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,866 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(435)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,431 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Total current liabilities</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">53,858 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">12,876 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(10,249)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">56,485 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Long-term obligations</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> excluding current installments</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">486,075 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">486,075 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Capital lease obligations,</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2 HEIGHT=16><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=2 HEIGHT=16><P></P></TD>
<TD WIDTH="15%" VALIGN="TOP" COLSPAN=2 HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> excluding current installments</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">312 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">313 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Deferred income taxes, net</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">15,126 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(10,003)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">5,123 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Total liabilities</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">555,371 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">12,877 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(20,252)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">547,996 </FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Shareholders' equity (deficit) </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(264,736)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">160,797 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">46,024 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(206,820)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(264,735)</FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P> Total liabilities and equity </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(264,736)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">716,168 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">58,901 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(227,072)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">283,261 </B></FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P> (deficit)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">12</P>
</B></FONT><P><HR COLOR=#4682B4></P>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 WIDTH=619>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<P ALIGN="CENTER"><B><FONT FACE="Verdana" SIZE=1>Condensed Consolidating Guarantor, Non-Guarantor and</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Parent Company Statement of Earnings</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">For the three months ended March 31, 2000</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(in thousands)</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(unaudited)</B></FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Kinetic</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Historical</B></FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Concepts,</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Reclassi-</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Kinetic</B></FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Inc.</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Non-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">fications</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Concepts,</B></FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Parent</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Guarantor</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Guarantor</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">and</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Inc.</B></FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Company</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Sub-</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Sub-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Elimi-</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">and Sub-</B></FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Borrower</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">nations</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>REVENUE:</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Rental and service</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">50,376 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">14,934 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">65,310 </FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Sales and other</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">14,935 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">6,242 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(3,785)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">17,392 </FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Total revenue</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">65,311 </B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">21,176 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(3,785)</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">82,702 </B></FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Rental expenses</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">30,315 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">11,928 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">42,243 </FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Cost of goods sold</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">6,761 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,755 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(2,327)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">7,189 </FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">37,076 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">14,683 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(2,327)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">49,432 </FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Gross profit</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">28,235 </B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">6,493 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,458)</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">33,270 </B></FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Selling, general and </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> administrative expenses</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">16,844 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,282 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">18,126 </FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Operating earnings</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">11,391 </B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">5,211 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,458)</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">15,144 </B></FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Interest income</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">463 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">49 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">512 </FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Interest expense</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(12,735)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(12,735)</FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Foreign currency loss</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(187)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(246)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(433)</FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Earnings (loss) before</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> income taxes</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,068)</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">5,014 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,458)</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,488 </B></FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Income tax</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(493)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,097 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(584)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,020 </FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Earnings (loss) before</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> equity in earnings</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> of subsidiaries</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(575)</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,917 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(874)</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,468 </B></FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Equity in earnings of </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> subsidiaries</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,468 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,917 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(4,385)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P> Net earnings</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,468 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,342 </B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,917 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(5,259)</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,468 </B></FONT></TD>
</TR>
</CENTER></P>
<FONT FACE="Verdana" SIZE=2><P ALIGN="CENTER"> </P>
</FONT><B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">13</P>
</B></FONT><P><HR COLOR=#4682B4></P>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 WIDTH=585>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<P ALIGN="CENTER"><FONT FACE="Verdana" SIZE=2> </FONT><B><FONT FACE="Verdana" SIZE=1>Condensed Consolidating Guarantor, Non-Guarantor and</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Parent Company Statement of Earnings</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">For the three months ended March 31, 1999</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(in thousands)</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=11 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(unaudited)</B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Kinetic</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Historical</B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=2 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Concepts,</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Reclassi-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Kinetic</B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Inc.</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Non-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">fications</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Concepts,</B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Parent</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Guarantor</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Guarantor</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">and</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Inc.</B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Company</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Sub-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Sub-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Elimi-</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">and Sub-</B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Borrower</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">nations</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>REVENUE:</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Rental and service</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">48,199 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">14,316 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">62,515 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Sales and other</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">14,228 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">6,188 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(2,720)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">17,696 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Total revenue</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">62,427 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">20,504 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(2,720)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">80,211 </B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Rental expenses</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">30,712 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">12,325 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">43,037 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Cost of goods sold</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">5,823 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3,099 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,723)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">7,199 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">36,535 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">15,424 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,723)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">50,236 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Gross profit</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">25,892 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">5,080 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(997)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">29,975 </B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Selling, general and</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> administrative expenses</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">14,452 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,048 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">15,500 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Operating earnings</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">11,440 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4,032 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(997)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">14,475 </B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Interest income</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">42 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">69 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">111 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Interest expense</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(11,667)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(11,667)</FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Foreign currency gain(loss)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(373)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">16 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(357)</FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Earnings (loss) before </B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> income taxes </B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(558)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4,117 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(997)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,562 </B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Income tax</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(298)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,722 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(399)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,025 </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Earnings (loss) before</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> equity in earnings</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> of subsidiaries</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(260)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,395 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(598)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,537 </B></FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Equity in earnings of</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> subsidiaries</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,537 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,395 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(3,932)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P> Net earnings</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,537 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,135 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,395 </B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(4,530)</B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,537 </B></FONT></TD>
</TR>
</CENTER></P>
<FONT FACE="Verdana" SIZE=2><P ALIGN="CENTER"> </P>
</FONT><B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">14</P>
</B></FONT><P><HR COLOR=#4682B4></P>
<TABLE CELLSPACING=0 BORDER=0 WIDTH=666>
<TR><TD VALIGN="TOP" COLSPAN=23 HEIGHT=15>
<P ALIGN="CENTER"><B><FONT FACE="Verdana" SIZE=1>Condensed Consolidating Guarantor, Non-Guarantor and</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=23 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Parent Company Statement of Cash Flows</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=23 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">For the three months ended March 31, 2000</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=23 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(in thousands)</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=23 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(unaudited)</B></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Kinetic</B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Concepts,</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Reclassi-</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Kinetic</B></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Inc.</B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Non-</B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">fications</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Concepts,</B></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Parent</B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Guarantor</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Guarantor</B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">and</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Inc.</B></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Company</B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Sub-</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Sub-</B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Elimi-</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">and Sub-</B></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Borrower</B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">nations</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P>Cash flows from operating activities:</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Net earnings</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 1,468 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 2,342 </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 2,917 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ (5,259)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 1,468 </FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Adjustments to reconcile net</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> earnings to net cash </FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> provided by operating activities</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,468)</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">8,213 </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">671 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">6,363 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">13,779 </FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P>Net cash provided by operating</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P> activities</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">10,555 </B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3,588 </B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,104 </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">15,247 </B></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P>Cash flows from investing activities:</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Additions to property, plant and</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> equipment</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(5,305)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,561)</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,319 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(4,547)</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Decrease in inventory to be </FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> converted into equipment for </FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> short-term rental</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">500 </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">500 </FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Dispositions of property, plant</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> and equipment</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">84 </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">392 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">476 </FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Increase in other assets</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(521)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(235)</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1) </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(757)</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P>Net cash used by investing</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P> activities</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(5,242)</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,404)</B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,318 </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(4,328)</B></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P>Cash flows from financing activities:</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Repayments of notes payable</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> and long-term obligations</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(9,554)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=6 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(9,554)</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Borrowings (repayments) of capital</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=7 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> lease obligations</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">68 </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=7 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1)</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">67 </FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Proceeds (payments) on inter-</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=7 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> company investments and</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=7 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> advances</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(893)</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">5,475 </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=7 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(939)</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(3,643)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Other</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">893 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,302)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=7 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,578)</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,987 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P>Net cash used by financing activities</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(5,313)</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=7 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(2,518)</B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,656)</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(9,487)</B></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Effect of exchange rate changes on</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=7 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> cash and cash equivalents</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=7 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(410)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(410)</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Net increase (decrease) in cash and</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=7 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> cash equivalents</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=7 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(334)</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,356 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,022 </FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Cash and cash equivalents,</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=7 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> beginning of period</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=7 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">9,879 </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(2,517)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">7,362 </FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P>Cash and cash equivalents, end</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=7 HEIGHT=15><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> of period</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT"> $ - </B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ - </B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=7 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 9,545 </B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=5 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ (1,161)</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 8,384 </B></FONT></TD>
</TR>
<FONT FACE="Verdana" SIZE=2><P ALIGN="CENTER"> </P>
</FONT><B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">15</P>
</B></FONT><P><HR COLOR=#4682B4></P>
<TABLE CELLSPACING=0 BORDER=0 WIDTH=618>
<TR><TD VALIGN="TOP" COLSPAN=16 HEIGHT=15>
<P ALIGN="CENTER"><FONT FACE="Verdana" SIZE=2> </FONT><B><FONT FACE="Verdana" SIZE=1>Condensed Consolidating Guarantor, Non-Guarantor and</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=16 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Parent Company Statement of Cash Flows</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=16 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">For the three months ended March 31, 1999</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=16 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(in thousands)</B></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=16 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">(unaudited)</B></FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Kinetic</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Concepts,</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Reclassi-</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Kinetic</B></FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Inc.</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Non-</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">fications</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Concepts,</B></FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Parent</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Guarantor</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Guarantor</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">and</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Inc.</B></FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Company</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Sub-</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Sub-</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Elimi-</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">and Sub-</B></FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Borrower</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">nations</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">sidiaries</B></FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P>Cash flows from operating activities:</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Net earnings</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 1,537 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 2,135 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 2,395 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ (4,530)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 1,537 </FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Adjustments to reconcile net</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> earnings to net cash provided</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> by operating activities</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,537)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,628 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,438 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">5,840 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">8,369 </FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P>Net cash provided by operating</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P> activities</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4,763 </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3,833 </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,310 </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">9,906 </B></FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P>Cash flows from investing activities:</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Additions to property, plant and</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> equipment</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(6,043)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,249)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">807 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(6,485)</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Decrease in inventory to be </FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> converted into equipment for </FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> short-term rental</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">100 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">100 </FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Dispositions of property, plant</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> and equipment</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">194 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">267 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">461 </FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Businesses acquired in purchase</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> transactions, net of cash</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> acquired</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(797)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(797)</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Decrease (increase) in other </FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> assets</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">6,439 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(57)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">6,382 </FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P>Net cash used by investing</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P> activities</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(107)</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,039)</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">807 </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(339)</B></FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P>Cash flows from financing activities:</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Repayments of notes payable</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> and long-term obligations</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(5,872)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(5,872)</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Repayments of capital lease</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> obligations</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(36)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(15)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(51)</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Proceeds (payments) on inter-</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> company investments and</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> advances</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(853)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,453 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,016 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(2,616)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Cash dividends paid to</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> shareholders</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(3,025)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3,025 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> Other</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">853 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,201)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,426)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1,774 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P>Net cash used by financing activities</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(4,656)</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(3,450)</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,183 </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(5,923)</B></FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Effect of exchange rate changes on</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> cash and cash equivalents</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(347)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(347)</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Net increase (decrease) in cash</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> and cash equivalents</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(656)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3,953 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3,297 </FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P>Cash and cash equivalents,</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P> beginning of period</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">9,543 </FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(5,177)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4,366 </FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=15>
<B><FONT FACE="Verdana" SIZE=1><P>Cash and cash equivalents, end of</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=15><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=15><P></P></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> period</B></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" COLSPAN=2 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ - </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ - </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 8,887 </B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=4 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ (1,224)</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 7,663 </B></FONT></TD>
</TR>
<FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER"> </P>
<B><P ALIGN="CENTER">16</P>
</B></FONT><P><HR COLOR=#4682B4></P>
<FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF THE</P>
<P ALIGN="CENTER">PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995</P>
<P ALIGN="JUSTIFY"> The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for certain forward-looking statements. The forward-looking statements made in "Management's
Discussion and Analysis of Financial Condition and Results of Operations," which reflect management's best judgment based on currently known market and other factors, involve risks and uncertainties. When used in this Report, the words "estimate,"
"project," "an
<B><P ALIGN="CENTER">17</P>
</B></FONT><P><HR COLOR=#4682B4></P>
<B><U><FONT FACE="Verdana" SIZE=1><P>ITEM 2</U>. <U>MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION</U><BR>
<U>AND RESULTS OF OPERATIONS</P><DIR>
</U><P>Results of Operations</P>
<U><P>First Quarter of 2000 Compared to First Quarter of 1999</P>
</B></U><P ALIGN="JUSTIFY"> The following table sets forth, for the periods indicated, the percentage relationship of each item to total revenue as well as the change in each line item as compared
to the first quarter of the prior year ($ in thousands):</P>
<P ALIGN="JUSTIFY"> </P></DIR>
</FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 WIDTH=610>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16>
<P></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="56%" VALIGN="TOP" COLSPAN=7 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Three Months Ended March 31,</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Variance</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="26%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Revenue Relationship</B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Increase (Decrease)</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">2000</B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">1999</B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">$</B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Pct</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Revenue:</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Rental and service</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">79 </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>%</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">78 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>% </FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 2,795 </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>%</FONT></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> Sales and other </FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">21 </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">22 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(304)</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(2)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Total revenue</B></FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">100 </B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">100 </B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,491 </B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3 </B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Rental expenses</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">51 </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">54 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(794)</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(2)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Cost of goods sold</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">9 </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">9 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(10)</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Gross profit</B></FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">40 </B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">37 </B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3,295 </B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">11 </B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Selling, general and administrative</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P> expenses</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">22 </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">19 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2,626 </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">17 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Operating earnings</B></FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">18 </B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">18 </B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">669 </B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">5 </B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Interest income</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1 </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">401 </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">361 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Interest expense</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(15)</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(15)</FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1,068)</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">9 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Foreign currency </FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(1)</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(76)</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">21 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P> Earnings before income taxes</B></FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3 </B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3 </B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(74)</B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(3)</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Income taxes</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1 </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT"> 1 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(5)</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">- </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="37%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P> Net earnings</B></FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2 </B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P>%</B></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">2 </B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P>% </B></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$ 69)</B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">(4)</B></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17>
<B><FONT FACE="Verdana" SIZE=1><P>%</B></FONT></TD>
</TR>
</CENTER></P>
<DIR>
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY"> The Company's revenue is derived from two primary operating segments. The following table sets forth, for the periods indicated, the amount of
revenue derived from each of these segments ($ in millions):</P></DIR>
</FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 WIDTH=381>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="34%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Three months ended</B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Variance</B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="34%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">March 31,</B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Inc (Dec)</B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">2000</B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">1999</B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=16>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Pct</B></FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>KCI USA </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">61.0 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">58.9 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">4 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>%</FONT></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>KCI International</FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">21.3 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">21.1 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">1 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P>Other</FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">0.4 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">0.2 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=16>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">100 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P> Total Revenue</FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">82.7 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">80.2 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P ALIGN="RIGHT">3 </FONT></TD>
<TD WIDTH="6%" VALIGN="TOP" HEIGHT=17>
<FONT FACE="Verdana" SIZE=1><P>%</FONT></TD>
</TR>
</CENTER></P>
<B><U><FONT FACE="Verdana" SIZE=2><P ALIGN="CENTER"> </P><DIR>
</U></FONT><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">18</P></DIR>
</B></FONT><P><HR COLOR=#4682B4></P>
<B><U><FONT FACE="Verdana" SIZE=1><P>ITEM 2</U>. <U>MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION</U><BR>
<U>AND RESULTS OF OPERATIONS (continued) </P><DIR>
</B></U><P ALIGN="JUSTIFY"> Total revenue for the first three months of 2000 was $82.7 million, an increase of $2.5 million, or 3.1%, from the prior year. Rental revenue of $65.3 million increased
$2.8 million, or 4.5%, from 1999 while sales of $17.4 million decreased approximately $300,000, or 1.7%, compared to the same period one year ago.</P>
<P ALIGN="JUSTIFY"> Total domestic revenue was $61.0, up $2.1 million, or 3.6%, from the 1999 quarter. Domestic rental revenue of $50.4 million increased $2.2 million, or 4.5%, due primarily to
increased usage of the Vacuum Assisted Closure device (the "V.A.C."). Domestic surface rentals decreased $1.2 million, or 3.0%, as lower extended care and home care rentals offset a slight increase in acute care revenue. Overall, domestic unit volume for
surf
<P ALIGN="JUSTIFY"> Domestic sales revenue of $10.6 million for the first quarter was essentially flat with the prior year as increased V.A.C. disposables and dressing sales were offset by lower
sales of vascular products.</P>
<P ALIGN="JUSTIFY"> Total V.A.C. revenue for the first quarter of 2000 was $16.1 million, an increase of approximately $6.5 million, or 67.1%, from the year-ago quarter. Domestic V.A.C. revenue of
$12.7 million increased $5.5 million during the period while international V.A.C. revenue of $3.4 million grew $1.0 million compared to the first quarter of the prior year.</P>
<P ALIGN="JUSTIFY"> Revenue from the Company's international operating unit increased $200,000 to $21.3 million from $21.1 million in the first quarter of 1999. The international revenue increase
reflects higher patient surface days in a majority of the Company's markets, and growth in the V.A.C. product line, substantially offset by unfavorable currency exchange rates. On a local currency basis, revenue increased $2.4 million, or 11.2%, compared to
<P ALIGN="JUSTIFY"> Rental, or field, expenses of $42.2 million represented 64.7% of total rental revenue in the first quarter of 2000 compared to 68.8% in the first quarter of 1999. This relative
decrease is primarily attributable to the increase in rental revenue because the majority of the Company's rental or field expenses are relatively fixed. Overall, field expenses of $42.2 million decreased $794,000, or 1.8% from the prior year due, in part,
<P ALIGN="JUSTIFY"> Cost of goods sold of $7.2 million in the first quarter of 2000 was flat with the prior year period. Sales margins were consistent year-to-year at 59%.</P>
<P ALIGN="JUSTIFY"> Gross profit increased $3.3 million, or 11.0%, to $33.3 million in the first quarter of 2000 from $30.0 million in the first quarter of 1999 due primarily to the increase in
rental revenue discussed previously. Gross profit margin for the first quarter, as a percentage of total revenue, was 40.2%, up from 37.4% for the first quarter of 1999, due to the increase in rental revenue combined with flat field expense and cost of
sales.
<P ALIGN="JUSTIFY"> Selling, general and administrative expenses increased $2.6 million, or 16.9%, to $18.1 million in the first quarter of 2000 from $15.5 million in the first quarter of 1999.
This increase was due primarily to higher labor, sales commission and incentive compensation expense and increased depreciation and amortization expense. As a percentage of total revenue, selling, general and administrative expenses were 21.9% in the
first qu
<P ALIGN="JUSTIFY"> Operating earnings for the period increased 4.6% to $15.1 million compared to $14.5 million in the prior-year quarter. The increase in operating earnings is primarily due to
the increase in rental revenue, partially offset by higher selling, general and administrative expenses, as discussed above.</P>
<B><P ALIGN="CENTER">19</P></DIR>
</B></FONT><P><HR COLOR=#4682B4></P>
<B><U><FONT FACE="Verdana" SIZE=1><P>ITEM 2</U>. <U>MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION</U><BR>
<U>AND RESULTS OF OPERATIONS (continued)</P><DIR>
</B></U><P ALIGN="JUSTIFY"> Interest income for the first quarter of 2000 was approximately $512,000 compared to $111,000 in the prior year quarter. The increase in interest income resulted
primarily from interest earned related to a federal tax refund associated with an audit of the 1993/1994 tax years.</P>
<P ALIGN="JUSTIFY"> Interest expense for the three months ended March 31, 2000 was $12.7 million compared to $11.7 million for the first quarter of 1999. The interest expense increase was due to
interest costs associated with the Company's amendment of its Senior Credit Agreement completed in February 2000.</P>
<P ALIGN="JUSTIFY"> Net earnings for the first quarter of 2000 decreased $69,000, or 4.5%, from the prior year to $1.5 million due substantially to the increase in selling, general and
administrative expenses and interest expense, offset by the increase in rental revenue, as discussed above.</P>
<B><U><P ALIGN="JUSTIFY">Financial Condition</P>
</B></U><P ALIGN="JUSTIFY"> The change in revenue and expenses experienced by the Company during the three months ended March 31, 2000 and other factors resulted in changes to the Company's
balance sheet as follows:</P>
<P ALIGN="JUSTIFY"> Net property, plant and equipment at March 31, 2000 decreased $3.6 million, or 4.9%, to $70.4 million as compared to $74.1 million at December 31, 1999. This decrease is due to
depreciation expense, partially offset by net capital expenditures of $3.6 million made during the first quarter of 2000.</P>
<P ALIGN="JUSTIFY"> Accrued expenses at March 31, 2000 were $39.1 million compared to $34.4 million at the end of 1999. This increase was due to accrued interest expense recorded during the first
three months on the $200 million in subordinated notes.</P>
<P ALIGN="JUSTIFY"> Long-term debt obligations, including the current maturities, decreased $9.6 million to $493.3 million as of March 31, 2000 due to the repayment of a portion of the Company's
revolving credit facility, an excess cash flow payment of approximately $850,000 and scheduled principal payments of $4.2 million. </P>
<B><U><P ALIGN="JUSTIFY">Liquidity and Capital Resources</P>
</B></U><P ALIGN="JUSTIFY"> At March 31, 2000 the Company had current assets of $121.3 million and current liabilities of $68.1 million resulting in a working capital surplus of $53.2 million,
compared to a surplus of $62.5 million at December 31, 1999. Higher accrued interest expense accounted for a majority of this change.</P>
<P ALIGN="JUSTIFY"> Operating cash flows were $15.2 million for the first quarter of 2000, an increase of $5.3 million from the prior year due primarily to improved working capital management.</P>
<P ALIGN="JUSTIFY"> During the first three months of 2000, the Company made net capital expenditures of $3.6 million. Other than commitments for new product inventory, including disposable "for
sale" products, of $1.9 million, the Company has no material long-term capital commitments and can adjust the level of capital expenditures as circumstances warrant.</P>
<P ALIGN="JUSTIFY"> The Company's principal sources of liquidity are expected to be cash flows from operating activities and borrowings under the Senior Credit Facilities. It is anticipated that
the Company's principal uses of liquidity will be to fund capital expenditures related to the Company's rental products, provide needed working capital, meet debt service requirements and finance the Company's strategic plans.</P>
<P ALIGN="JUSTIFY"> The Senior Credit Facilities originally totaled $400.0 million and consisted of (i) a $50.0 million six-year Revolving Credit Facility, (ii) a $50.0 million six-year
Acquisition Facility, (iii) a $120.0 million </P>
<B><P ALIGN="CENTER">20</P></DIR>
</B></FONT><P><HR COLOR=#4682B4></P>
<B><U><FONT FACE="Verdana" SIZE=1><P>ITEM 2</U>. <U>MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION</U><BR>
<U>AND RESULTS OF OPERATIONS (continued)</P><DIR>
<P ALIGN="JUSTIFY">Liquidity and Capital Resources (continued)</P>
</B></U><P ALIGN="JUSTIFY">six-year amortizing Term Loan A, (iv) a $90.0 million seven-year amortizing Term Loan B and (v) a $90.0 million eight-year amortizing Term Loan C, (collectively, the "Term Loans"). In November 1999, in anticipation of a
potential default on its Interest Coverage, Minimum EBITDA and Leverage Ratio Covenants at December 31, 1999, due to the decline in extended care rental revenue experienced during the year, the Company requested its Senior Lenders to waive these covenants
for the p
s a result of the Amendment completed on February 17, 2000, the aggregate availability under the Revolving Facility was $45.2 million.</P>
<P ALIGN="JUSTIFY"> The Senior Credit Agreement, as amended, requires the Company to meet certain financial tests, including minimum levels of EBITDA (as defined therein), minimum interest
coverage, maximum leverage ratio and capital expenditures. The Senior Credit Agreement also contains covenants which, among other things, limit the incurrence of additional indebtedness, investments, dividends, loans and advances, capital expenditures,
transaction
es, acquisitions, mergers and consolidations, prepayments of other indebtedness (including the Notes), liens and encumbrances and other matters customarily restricted in such agreements. As noted above, the Amendment established revised financial covenant
levels for Interest Coverage, Leverage Ratio and Minimum EBITDA. The Company is in compliance with the applicable covenants at March 31, 2000.</P>
<P ALIGN="JUSTIFY"> The Senior Credit Agreement also contains customary events of default, including payment defaults, breach of representations and warranties, covenant defaults, cross-defaults
to certain other indebtedness, certain events of bankruptcy and insolvency, failures under ERISA plans, judgment defaults, change of control of the Company and failure of any guaranty, security document, security interest or subordination provision supporti
n
<P ALIGN="JUSTIFY"> As part of the Recapitalization transactions, the Company issued $200.0 million of Senior Subordinated Notes (the "Notes") due 2007. The Notes are unsecured obligations of the
Company, ranking subordinate in right of payment to all senior debt of the Company and will mature on November 1, 2007. As of March 31, 2000, the entire $200.0 million of Senior Subordinated Notes was issued and outstanding.</P>
<P ALIGN="JUSTIFY"> The Notes are not entitled to the benefit of any mandatory sinking fund. The Notes will be redeemable, at the Company's option, in whole at any time or in part from time to
time, on and after November 1, 2002, upon not less than 30 nor more than 60 days' notice, at the following redemption prices (expressed as percentages of the principal amount thereof) if redeemed during the twelve-</P>
<B><P ALIGN="CENTER">21</P></DIR>
</B></FONT><P><HR COLOR=#4682B4></P>
<B><U><FONT FACE="Verdana" SIZE=1><P>ITEM 2</U>. <U>MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION</U><BR>
<U>AND RESULTS OF OPERATIONS (continued)</P><DIR>
<P ALIGN="JUSTIFY">Liquidity and Capital Resources (continued)</P>
</B></U><P ALIGN="JUSTIFY">month period commencing on November 1 of the year set forth below, plus, in each case, accrued and unpaid interest thereon, if any, to the date of redemption. </P></DIR>
</FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 WIDTH=278>
<TR><TD WIDTH="61%" VALIGN="TOP">
<P ALIGN="JUSTIFY"><U><FONT FACE="Verdana" SIZE=1>Year</U></FONT></TD>
<TD WIDTH="39%" VALIGN="TOP">
<U><FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Percentage</U></FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>2002</FONT></TD>
<TD WIDTH="39%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">104.813%</FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>2003</FONT></TD>
<TD WIDTH="39%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">103.208%</FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>2004</FONT></TD>
<TD WIDTH="39%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">101.604%</FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">2005 and thereafter</FONT></TD>
<TD WIDTH="39%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">100.000%</FONT></TD>
</TR>
</CENTER></P>
<DIR>
<FONT FACE="Verdana" SIZE=2><P ALIGN="JUSTIFY">	</P>
</FONT><FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY"> At March 31, 2000, cash and cash equivalents of $8.4 million were available for general corporate purposes. Based upon the current level of
operations, the Company believes that cash flow from operations and the availability under its line of credit will be adequate to meet its anticipated requirements for debt repayment, working capital and capital expenditures through 2000. Also at March 31,
2
ed to purchase approximately $1.9 million of inventory associated with new products over the remainder of this year. The Company did not have any other material purchase commitments.</P>
<B><U><P ALIGN="JUSTIFY">Known Trends or Uncertainties</P>
</B></U><P ALIGN="JUSTIFY"> The health care industry continues to face various challenges, including increased pressure on health care providers to control costs as a result of the Balanced Budget
Act of 1997, the accelerating migration of patients from acute care facilities into extended care (e.g. skilled nursing facilities and rehabilitation centers) and home care settings, the consolidation of health care providers and national and regional grou
nd the growing demand for clinically proven therapies which lower the total cost of providing care. </P>
<P ALIGN="JUSTIFY"> More recently, sales have increased as a portion of the Company's revenue. The Company believes this trend will continue because customers are purchasing disposables associated
with the Company's growing installed base of medical devices and select low-end products that are less expensive and easier to maintain. In addition, international health care providers tend to purchase products more often than U.S. health care providers.<
<U><P ALIGN="JUSTIFY">Euro Currency</P>
</U><P ALIGN="JUSTIFY"> On January 1, 1999, the European Economic and Monetary Union ("EMU") entered a three-year transition period during which a new common currency, the "Euro", was introduced
in participating countries and fixed conversion rates were established through the European Central Bank ("ECB") between existing local currencies and the Euro. Since then the Euro has traded on currency exchanges.</P>
<P ALIGN="JUSTIFY"> Following the introduction of the Euro, local currencies will remain legal tender until December 31, 2001. During this transition period, goods and services may be paid for
with the Euro or local currency under the EMU's "no compulsion, no prohibition" principle.</P>
<P ALIGN="JUSTIFY"> Based on its evaluation to date, management believes that the introduction of the Euro will not have a long-term material adverse impact on the Company's financial position,
results of operations or cash flows. However, the prevailing exchange rate for the Euro versus the U.S. dollar has been in decline and uncertainty exists as to the effects the Euro will have in the marketplace, and there is no guarantee that all issues
have b
<P ALIGN="JUSTIFY"> The Company has reviewed its information systems software and identified modifications necessary to ensure that business transactions can be conducted in a manner consistent
with the requirements of the conversion to the Euro. Certain of these modifications have been implemented, and others will be implemented during the course of the transition period. The Company expects that modifications not yet implemented will be made
on a
<B><P ALIGN="CENTER">22</P></DIR>
</B></FONT><P><HR COLOR=#4682B4></P>
<B><U><FONT FACE="Verdana" SIZE=1><P>ITEM 2</U>. <U>MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION</U><BR>
<U>AND RESULTS OF OPERATIONS (continued)</P><DIR>
<P ALIGN="JUSTIFY">Known Trends or Uncertainties (continued)</P>
</B></U><P ALIGN="JUSTIFY"> The Euro introduction is not expected to have a material long-term impact on the Company's overall currency risk. The Company anticipates the Euro will simplify
financial issues related to cross-border trade in the EMU and reduce the transaction costs and administrative time necessary to manage this trade and related risks. However, the Company believes that the associated savings will not be material to
corporate results
<U><P ALIGN="JUSTIFY">Reimbursement</P>
</U><P ALIGN="JUSTIFY"> The implementation of a prospective payment system for extended care facilities has changed the way skilled nursing facilities buy and rent products. The effect of this
change has been to sharply reduce the Company's revenues in the extended care market. The Company believes that in the long term, under a fixed payment system, decisions on selecting the products and services used in patient care will be based on clinical
and
<P ALIGN="JUSTIFY"> Home Health PPS is scheduled to be implemented on October 1, 2000. Although it is difficult to predict the impact which Home Health PPS will have on the overall home health
market, the Company does not believe that the implementation of Home Health PPS will have a material impact on the Company's business.</P>
<P ALIGN="JUSTIFY"> The Company currently rents and sells the V.A.C. in all care settings and market acceptance of this product has been better than expected. This is evidenced by the significant
revenue growth experienced in the four years that the product has been available domestically. However, the Company has not received a Medicare reimbursement code, and an associated coverage policy, for the V.A.C. in the home care setting. The Company conti
<B><U><P ALIGN="JUSTIFY">Impact of Year 2000</P>
</B></U><P ALIGN="JUSTIFY"> In prior years, the Company discussed the nature and progress of its plans to become Year 2000 compliant. In late 1999, the Company completed its remediation and
testing of systems. As a result of those planning and implementation efforts, the Company experienced no significant disruptions in mission critical information technology and non-information technology systems and believes those systems successfully
responded to
<B><U><P ALIGN="JUSTIFY">Legal Proceedings</P>
</B></U><P ALIGN="JUSTIFY"> On February 21, 1992, Novamedix Limited ("Novamedix") filed a lawsuit against the Company in the United States District Court for the Western District of Texas.
Novamedix manufactures the principal product which directly competes with the PlexiPulse. The suit alleges that the PlexiPulse infringes several patents held by Novamedix, that the Company breached a confidential relationship with Novamedix and a variety
of ancill
<P ALIGN="JUSTIFY"> </P>
<B><P ALIGN="CENTER">23</P></DIR>
</B></FONT><P><HR COLOR=#4682B4></P>
<B><U><FONT FACE="Verdana" SIZE=1><P>ITEM 2</U>. <U>MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION</U><BR>
<U>AND RESULTS OF OPERATIONS (continued)</P><DIR>
<P ALIGN="JUSTIFY">Legal Proceedings (continued)</P>
</B></U><P ALIGN="JUSTIFY"> On August 16, 1995, the Company filed a civil antitrust lawsuit against Hillenbrand Industries, Inc. and one of its subsidiaries, Hill-Rom. The suit was filed in the
United States District Court for the Western District of Texas. The suit alleges that Hill-Rom used its monopoly power in the standard hospital bed business to gain an unfair advantage in the specialty hospital bed business. Specifically, the allegations
set
<P ALIGN="JUSTIFY"> On October 31, 1996, the Company received a counterclaim which had been filed by Hillenbrand Industries, Inc. in the antitrust lawsuit which the Company filed in 1995. The
counterclaim alleges that the Company's antitrust lawsuit and other actions were designed to enable KCI to monopolize the specialty therapeutic surface market. Although it is not possible to reliably predict the outcome of this litigation, the Company
believes
<P ALIGN="JUSTIFY"> The Company is a party to several lawsuits arising in the ordinary course of its business. Provisions have been made in the Company's financial statements for estimated
exposures related to these lawsuits. In the opinion of management, the disposition of these matters will not have a material adverse effect on the Company's business, financial condition or results of operations.</P>
<P ALIGN="JUSTIFY"> The manufacturing and marketing of medical products necessarily entails an inherent risk of product liability claims. The Company currently has certain product liability claims
pending for which provision has been made in the Company's financial statements. Management believes that resolution of these claims will not have a material adverse effect on the Company's business, financial condition or results of operations. The Compan
<B><U><P ALIGN="JUSTIFY">Item 3</B>. </U> <B><U>Quantitative and Qualitative Disclosures about Market Risk </P>
</B></U><P ALIGN="JUSTIFY"> The Company is exposed to various market risks, including fluctuations in interest rates and variability in currency exchange rates. The Company has established
policies, procedures and internal processes governing its management of market risks and the use of financial instruments to manage its exposure to such risks.</P>
<U><P ALIGN="JUSTIFY">Interest Rate Risk</P>
</U><P ALIGN="JUSTIFY"> At March 31, 2000, approximately 9.7% of the Company's long-term debt, as adjusted for the interest rate protection agreements, bear interest at variable rates. These
variable-rate facilities bear interest at a stated rate based upon a Base Rate (defined as the higher of (i) the rate of interest publicly announced by Bank of America as its "reference rate" or (ii) the federal funds effective rate from time to time plus
0.50%)
<B><P ALIGN="CENTER">24</P></DIR>
</B></FONT><P><HR COLOR=#4682B4></P><DIR>
<B><U><FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Item 3</B>. </U> <B><U>Quantitative and Qualitative Disclosures about Market Risk (continued)</P>
</B></U><P ALIGN="JUSTIFY"> In an effort to minimize the risk of adverse interest rate fluctuations, the Company has entered into two interest rate protection agreements which effectively fix the
base borrowing rate on 84% of the Company's variable rate debt as follows (dollars in millions):</P></DIR>
</FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 WIDTH=374>
<TR><TD WIDTH="38%" VALIGN="TOP">
<P><FONT FACE="Verdana"> </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Fixed</B></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Base</B></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Swap</B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Interest</B></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Maturity</B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Amount</B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Rate</B></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">01/08/2002 </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">$150.0 </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">5.5775% </FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">12/29/2000 </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">$ 95.0 </FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">4.8950% </FONT></TD>
</TR>
</CENTER></P>
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY"> As a result of these interest rate protection agreements, the Company believes that movements in short term interest rates would not materially
affect the financial position of the Company.</P>
<U><P ALIGN="JUSTIFY"> </P>
<P ALIGN="JUSTIFY">Foreign Currency and Market Risk</P>
</U><P ALIGN="JUSTIFY"> The Company has direct operations in Western Europe, Canada and Australia and distributor relationships in many other parts of the world. The Company's foreign operations
are measured in their local currencies. As a result, the Company's financial results could be affected by factors such as changes in foreign currency exchange rates or weak economic conditions in the foreign markets in which the Company has operations. Expo
s
<DIR>
<DIR>
<B><P ALIGN="CENTER">25</P></DIR>
</DIR>
</DIR>
</B></FONT><P><HR COLOR=#4682B4></P><DIR>
<DIR>
<DIR>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">PART II - OTHER INFORMATION</P>
<U><P>ITEM 6.</U> <U>EXHIBITS AND REPORTS ON FORM 8-K</P>
</B></U><P> (a) EXHIBITS</P>
<P ALIGN="JUSTIFY"> A list of all exhibits filed or included as part of this quarterly report on Form 10-Q is as follows:</P></DIR>
</DIR>
</DIR>
</FONT>
<P ALIGN="RIGHT"><TABLE CELLSPACING=0 BORDER=0 WIDTH=532>
<TR><TD WIDTH="15%" VALIGN="TOP">
<P><FONT FACE="Verdana" SIZE=1> <U>Exhibit</U></FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<U><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">Description</U></FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>3.1</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Restatement of Articles of Incorporation (filed as Exhibit 3.2 to the Company's Registration Statement on Form S-1, as amended (Registration No. 33-21353), and incorporated herein by reference).</FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>3.2</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Restated By-Laws of the Company (filed as Exhibit 3.3 to the Company's Registration Statement on Form S-1, as amended (Registration No. 33-21353), and incorporated herein by reference).</FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>4.1</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Specimen Common Stock Certificate of the Company (filed as Exhibit 4.1 to the Annual Report on Form 10-K for the year ended December 31, 1988, and incorporated herein by reference).</FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>10.1</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">KCI Employee Benefits Trust Agreement (filed as Exhibit 10.21 to the Company's Annual Report on Form 10-K/A dated December 31, 1994, and incorporated herein by reference).</FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>10.2</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Letter, dated September 19, 1994, from the Company to Raymond R. Hannigan outlining the terms of his employment (filed as Exhibit 10.22 to the Company's Annual Report on Form 10-K/A dated December 31, 1994,
and incorporated herein by reference).</FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>10.3</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Letter, dated November 22, 1994, from the Company to Christopher M. Fashek outlining the terms of his employment (filed as Exhibit 10.23 to the Company's Annual Report on Form 10-K/A dated December 31, 1994,
and incorporated herein by reference). </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>10.4</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Deferred Compensation Plan (filed as Exhibit 99.2 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1995 and incorporated herein by reference).</FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>10.5</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Kinetic Concepts, Inc. Senior Executive Stock Option Plan (filed as Exhibit 10.31 to the Company's Annual Report on Form 10-K for the year ended December 31, 1996, and incorporated herein by reference).</FONT>
</TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>10.6</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Form of Option Instrument with respect to Senior Executive Stock Option Plan (filed as Exhibit 10.32 to the Company's Annual Report on Form 10-K for the year ended December 31, 1996, and incorporated herein
by reference).</FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>10.7</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Kinetic Concepts Management Equity Plan effective October 1, 1997 (filed as Exhibit 10.33 on Form 10-K for the year ended December 31, 1997, and incorporated herein by reference). </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>	 </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>10.8</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Director Equity Agreement, dated May 12, 1998, between the Company and Charles N. Martin (filed as Exhibit 10.8 on Form 10-K for the year ended December 31, 1998, and incorporated herein by reference).</FONT>
</TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>10.9</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Director Equity Agreement, dated May 12, 1998, between the Company and Donald E. Steen (filed as Exhibit 10.9 on Form 10-K for the year ended December 31, 1998, and incorporated herein by reference).</FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>10.10</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Letter, dated June 4, 1998, from the Company to William M. Brown outlining the terms of his employment (filed as Exhibit 10.10 on Form 10-K for the year ended December 31, 1998, and incorporated herein by
reference).</FONT></TD>
</TR>
</P>
<DIR>
<DIR>
<DIR>
<FONT FACE="Verdana" SIZE=2><P ALIGN="RIGHT"> </P>
</FONT><B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER">26</P></DIR>
</DIR>
</DIR>
</B></FONT><P><HR COLOR=#4682B4></P><DIR>
<DIR>
<DIR>
<FONT FACE="Verdana" SIZE=1><P>
(Exhibits continued)
 
</DIR>
</DIR>
</FONT>
<P ALIGN="RIGHT"><TABLE CELLSPACING=0 BORDER=0 WIDTH=532>
<TR><TD WIDTH="15%" VALIGN="TOP">
<P><FONT FACE="Verdana"> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P> 10.11 </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Supplier Agreement, dated December 1, 1998, between Novation, LLC and Kinetic Concepts, Inc. (filed as Exhibit 10.11 on Form 10-K for the year ended December 31, 1998, and incorporated herein by reference).
</FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>*10.12</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>Letter, dated March 28, 2000, from the Company to Dennert O. Ware outlining the terms of his employment.</FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>*10.13</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>Third Amendment to the Credit and Guarantee Agreement dated as of February 24, 2000 by and among the Company, several banks and financial institutions, as Lenders, Bank of America, as administrative agent and Bankers Trust
Company, as syndication agent.</FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P> 21.1</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">List of Subsidiaries (filed as Exhibit 21.0 to the Company's Annual Report on Form 10-K for the year ended December 31, 1999, and incorporated herein by reference).</FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>*27.1</FONT></TD>
<TD WIDTH="85%" VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Financial Data Schedule.</FONT></TD>
</TR>
</P>
<DIR>
<DIR>
<DIR>
<FONT FACE="Verdana" SIZE=1><P ALIGN="JUSTIFY">Note: (*) Exhibits filed herewith.	</P>
<P ALIGN="JUSTIFY"> (b) REPORTS ON FORM 8-K</P><DIR>
<P>The Company filed a report on Form 8-K dated April 19, 2000 with respect to the appointment of Mr. Dennert O. Ware as President and Chief Executive Officer for the Company.
</P></DIR>
<P> </P>
<B><P ALIGN="CENTER">27</P></DIR>
</DIR>
</DIR>
</B></FONT><P><HR COLOR=#4682B4></P><DIR>
<DIR>
<DIR>
<B><FONT FACE="Verdana" SIZE=1><P ALIGN="CENTER"> </P>
<P ALIGN="CENTER">SIGNATURES</P>
</B><P> </P>
<P ALIGN="JUSTIFY"> Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly
authorized.</P>
<P ALIGN="JUSTIFY"> </P>
<P ALIGN="JUSTIFY"> </P>
<P ALIGN="JUSTIFY"> </P></DIR>
</DIR>
</DIR>
</FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 WIDTH=327>
<TR><TD VALIGN="TOP">
<P><FONT FACE="Verdana" SIZE=1>KINETIC CONCEPTS, INC.</FONT></TD>
</TR>
<TR><TD VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>(REGISTRANT)</FONT></TD>
</TR>
<TR><TD VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>By:	__________________________________</FONT></TD>
</TR>
<TR><TD VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>	Dennert O. Ware</FONT></TD>
</TR>
<TR><TD VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>	President and Chief Executive Officer</FONT></TD>
</TR>
<TR><TD VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD VALIGN="TOP">
<FONT FACE="Verdana"><P> </FONT></TD>
</TR>
<TR><TD VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>By:	__________________________________</FONT></TD>
</TR>
<TR><TD VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>	William M. Brown</FONT></TD>
</TR>
<TR><TD VALIGN="TOP">
<FONT FACE="Verdana" SIZE=1><P>	Vice President and Chief Financial Officer</FONT></TD>
</TR>
</CENTER></P>
<DIR>
<DIR>
<DIR>
<FONT FACE="Verdana" SIZE=2><P ALIGN="CENTER"> </P>
<P> </P>
</FONT><FONT FACE="Verdana" SIZE=1><P> </P>
<P>Date: May 12, 2000</P>
<P> </P>
<B><P ALIGN="CENTER">28</P></DIR>
</DIR>
</DIR>
</B></FONT><P><HR COLOR=#4682B4></P></BODY>
</HTML>