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<P ALIGN="center">&#9;<B><font size="2" face="Times New Roman">SECURITIES AND EXCHANGE COMMISSION<br>
<br>
Washington, D.C.  20549<br>
<br>
FORM 8-K<br>
<br>
CURRENT REPORT<br>
<br>
<br>
PURSUANT TO SECTION 13 OR 15(d) OF THE <br>
SECURITIES EXCHANGE ACT OF 1934</font></P>
</B><P ALIGN="JUSTIFY"><font face="Times New Roman"><br>
<br>
<br>
<font size="2">Date of Report (Date of earliest event reported)</font></font><U><font size="2" face="Times New Roman">   &nbsp;&nbsp;December 12, 2002&#9;9;
</font></P>
</U><P ALIGN="center"><font face="Times New Roman"><br>
<font size="2"><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
LSB INDUSTRIES, INC.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<br>
</u>(Exact name of registrant as specified in its charter)</font></font></P>
<U><P ALIGN="JUSTIFY">     <font size="2" face="Times New Roman">&nbsp;&nbsp;&nbsp;     Delaware
</font>     </U>&#9;<font face="Times New Roman"><font size="2"><u>&nbsp;&nbsp;&nbsp;&nbsp;
</u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1-7677&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></font>&#9;<U>
<font size="2">73-1015226&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<br>
</font>
</U><font size="2">(State or other&#9;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Commission File &#9;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (IRS Employer<br>
jurisdiction of&#9;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;Number) &#9;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Identification No.)<br>
&nbsp;incorporation)</font></font></P>
<P ALIGN="JUSTIFY"><font face="Times New Roman"><br>
<br>
<U><font size="2">16 South Pennsylvania Avenue, Oklahoma City, Oklahoma</font></U><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></font>&#9;<U>
<font size="2">73107&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<br>
</font>
</U><font size="2">&nbsp;(Address of principal executive offices)&#9;    &nbsp;(Zip Code)</font></font></P>
<P ALIGN="JUSTIFY"><font face="Times New Roman"><br>
<br>
<font size="2">Registrant's telephone number, including area code </font></font> <U>
<font size="2" face="Times New Roman">(405) 235-4546 </font></P>
</U><P ALIGN="center"><font face="Times New Roman"><br>
<font size="2"><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Not applicable&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</u></font><br>
<font size="2">(Former name or former address, if changed since last report)</font></font></P>
<P ALIGN="JUSTIFY"><font face="Times New Roman"><br>
<br>
<br>
<font size="2">Item 2.  <U>Acquisition or Disposition of Assets</U>.<br>
<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &#9;On December 12, 2002, Slurry Explosive Corporation ("SEC") and Universal Tech Corporation ("UTeC"), each an Oklahoma corporation and an indirect, wholly owned subsidiary of LSB Industries, Inc. (the "Company") (SEC and UTeC, collectively, are the "Sellers") consummated the sale (the "Sale") by Sellers of substantially all of their assets to four wholly owned subsidiaries of Energetic Systems Inc., LLC (ESI"), a Nevada limited liability company (collectively, the "Buyers"), pursuant to the terms of an Asset Purchase Agreement, dated December 6, 2002 (the "Purchase Agreement").<br>
<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &#9;The assets sold by the Sellers comprised of substantially all of the explosives distribution business within the Company's chemical business. SEC and one of the four Buyers jointly own Slurry Explosive Manufacturing Corporation.  During 2001 and the first nine months of 2002, the Sellers' revenues were approximately $22 million and $7.4 million, respectively.<br>
<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &#9;The purchase price ("Purchase Price") paid by the Buyers to the Sellers under the Purchase Agreement at the closing of the Sale was approximately $10.2 million, determined by a base price of $7 million, plus approximately $2.7 for inventory and accounts receivable and $425,000 of assumed liabilities under an equipment lease.  Of the proceeds from the Sale, (a) approximately $250,000 was placed in escrow, (b) approximately $3.5 million was paid to a term lender, and (c) the balance of the proceeds were applied against the Company's revolving line of credit.  On or about March 4, 2003, the portion of the escrow funds equal to the amount of the accounts receivable purchased by the Buyers that are not collected will be paid to the Buyers, and the balance of the escrow funds will be released to the Sellers.  In connection with the disbursement of the escrow funds, the Buyers will assign such uncollected accounts receivable to the Sellers.<br>
<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &#9;The Company may, from time to time, borrow funds under its revolving line of credit based on the amount of eligible collateral.  Immediately after the pay down under the Company's revolving line of credit, the
unused borrowing availability under the credit facility was approximately $8.2 million based on eligible collateral as of that date.<br>
</font><br>
<br>
<font size="2">Item 7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &#9;&#9;<U>Financial Statements and Exhibits</U>.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</font></font>&#9;&#9;&#9;&#9;<U><font size="2" face="Times New Roman">Page No.</font></P>
</U>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a)&nbsp;&nbsp;&nbsp;
<font size="2" face="Times New Roman">&nbsp; <u>Pro Forma Financial Information</u>.&#9;&#9;&#9;&#9;9;&#9;&#9;&#9;
<br>
<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Pro Forma Condensed Consolidated Balance Sheet<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;   (Unaudited) as of September 30, 2002&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &#9;&#9;&#9;P-
2<br>
<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Pro Forma Consolidated Statement of<BR>
   &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
   Operations (Unaudited) for the Nine<BR>
   &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
   Months Ended September 30, 2002&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &#9;&#9;&#9;&#9;P-3</font></p>
<p align="center"><font size="2" face="Times New Roman">-2-</font></p>
<P><font face="Times New Roman"><br>
<font size="2"><br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Pro Forma Consolidated Statement of<BR>
   &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
   Operations (Unaudited) for the Year<BR>
   &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
   Ended December 31, 2001&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &#9;&#9;&#9;&#9;&#9;P-4<br>
<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Notes to Pro Forma Consolidated Financial<BR>
   &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
   Statements (Unaudited)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &#9;&#9;&#9;&#9;&#9;P-5</font></font></P>

<blockquote>
  <blockquote>

<P ALIGN="JUSTIFY"><font size="2" face="Times New Roman"><br>
&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &#9;Exhibits.<br>
<br>
2.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &#9;Asset Purchase Agreement, dated as of December 6, 2002, by and among Energetic Systems Inc. LLC, UTeC Corporation, LLC, SEC Investment Corp. LLC, DetaCorp Inc. LLC, Energetic Properties, LLC, Slurry Explosive Corporation, Universal Tech Corporation, El Dorado Chemical Company, LSB Chemical Corp., LSB Industries, Inc. and Slurry Explosive Manufacturing Corporation, LLC.
</font>  <B><font size="2" face="Times New Roman">The Asset Purchase Agreement contains a brief list identifying all schedules and exhibits to the Asset Purchase Agreement.  Such schedules and exhibits are not filed herewith, and the Registrant agrees to furnish supplementally a copy of the omitted schedules and exhibits to the Commission upon request.<br>
<br>
&nbsp;</font></P>
  </blockquote>
</blockquote>
</B><U>

<B><P ALIGN="center"><font size="2" face="Times New Roman">SIGNATURES</font></P>
</B></U>
<P ALIGN="JUSTIFY"><font size="2" face="Times New Roman"><br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 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 hereunto duly authorized.</font></P>
<P ALIGN="JUSTIFY"></P>
<P ALIGN="JUSTIFY"><font face="Times New Roman"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dated: December 27, 2002.<br>
<br>
<br>
<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; LSB INDUSTRIES, INC.<br>
<br>
<br>
<br>
<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; By:</font><U><font size="2">&nbsp;&nbsp;&nbsp;/s/
Tony M. Shelby&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<br>
</font>
</U><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;      Tony M. Shelby,
<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;      Senior Vice President and
<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;      (Chief Financial Officer)</font></font></P>
<P ALIGN="center"><font size="2" face="Times New Roman">-3-</font></P>

<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">LSB Industries, Inc.<br>
Unaudited Pro Forma Financial Information<br>
December 12, 2002</P>
<P ALIGN="JUSTIFY">&#9;&nbsp;&nbsp;&nbsp; &#9;On December 12, 2002 LSB Industries, Inc., (the "Company") and its subsidiaries, Slurry Explosive Corporation ('SEC") and Universal Technology Corporation ("UTeC") completed an agreement to sell substantially all the assets of SEC and UTeC (collectively, "SEC/UTeC").  Under the agreement, SEC/UTeC retains all of their liabilities, except liabilities for the financing of certain property and equipment, and will liquidate such liabilities retained from the proceeds of the sale (the "Transaction").<br>
<br>
&nbsp;&nbsp;&nbsp; &#9;The accompanying unaudited pro forma consolidated balance sheet as of September 30, 2002 gives effect to the Transaction involving the Company's wholly owned subsidiaries SEC/UTeC, as if it had occurred on September 30, 2002. The accompanying unaudited consolidated statements of operations for the year ended December 31, 2001 and the nine months ended September 30, 2002 give effect to the sale and realization of the assets of SEC/UTeC as if the Transaction had occurred as of January 1, 2001. Such unaudited pro forma consolidated financial information has been prepared based on estimates and assumptions deemed by the Company to be appropriate and does not purport to be indicative of the financial position or results of operations which may actually be obtained in the future. Future results may vary significantly from the results reflected in the unaudited pro forma consolidated statements of operations of the Company and its other retained subsidiaries due to general economic conditions and other factors.</P>

<P ALIGN="JUSTIFY">&#9;&nbsp;&nbsp;&nbsp; &#9;The pro forma consolidated financial information should be read in conjunction with the Company's historical financial statements and Management's Discussion and Analysis of Financial Condition and Results of Operations in the Company's Annual Report on Form 10-K for the year ended December 31, 2001 and Quarterly report on Form 10-Q for the nine months ended September 30, 2002.</P>

<P ALIGN="center">&#9;P-1</P>
</FONT>

<FONT FACE="Courier New" SIZE=2>

<P ALIGN="JUSTIFY">&#9;&nbsp;</P>
</FONT>

<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">LSB Industries, Inc.<BR>
<BR>
Unaudited Pro Forma Consolidated Balance Sheet<BR>
<BR>
September 30, 2002<BR>
<BR>
(In thousands)</P>
</FONT><FONT FACE="Courier New" SIZE=1><P ALIGN="CENTER"></P></FONT>
<TABLE CELLSPACING=0 BORDER=0 WIDTH=686 cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
<TR><TD WIDTH="37%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="12%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER"><BR>
</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER"><BR>
<U>Historical</U></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">Pro Forma<BR>
<U>Adjustments</U></FONT></TD>
<TD WIDTH="7%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER"><BR>
<U>Pro Forma</U></FONT></TD>
</TR>
</TABLE>

<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">Assets</P>
</FONT>
<TABLE BORDER="0" CELLSPACING=0 WIDTH=686 cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Current assets:</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>  &nbsp;&nbsp;  Cash and cash equivalents</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">687</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">687</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>  &nbsp;&nbsp;  Trade accounts and notes receivable, net</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">39,994</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(1,023</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">38,971</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>  &nbsp;&nbsp;  Inventories</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">24,647</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(1,306</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">23,341</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>  &nbsp;&nbsp;  Supplies and prepaid items</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">7,582</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(65</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">7,517</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total current assets</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">72,910</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(2,394</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(1</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="JUSTIFY">)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(4</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">70,516</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Property, plant and equipment, at cost</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">159,179</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(7,495</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">151,684</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Less accumulated depreciation and <BR>
  &nbsp;
  amortization</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
79,225</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
(3,172</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P><BR>
)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
76,053</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">79,954</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(4,323</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(1</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="JUSTIFY">)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">75,631</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Other assets, net</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">16,149</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(66</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(1</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="JUSTIFY">)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(4</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">16,083</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">169,013</FONT><hr color="#000000"></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(6,783</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT><hr color="#000000"></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="9%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">162,230</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
</TABLE>

<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">Liabilities and Stockholders' Equity (Deficit)</P>
</FONT><FONT FACE="Courier New" SIZE=2><P ALIGN="CENTER"></P>
</FONT>
<TABLE BORDER="0" CELLSPACING=0 WIDTH=686 cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Current liabilities:</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>&nbsp;&nbsp; Accounts and drafts payable</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">25,984</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(818</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(4</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">25,166</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>&nbsp;&nbsp; Accrued liabilities</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">15,318</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(296</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(1</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(4</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">15,022</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>&nbsp;&nbsp; Current portion of long-term debt</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">43,116</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(4,451</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(1</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(3</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">38,665</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total current liabilities</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">84,418</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(5,565</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">78,853</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Long-term debt</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">80,714</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(4,676</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(1</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(3</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">76,038</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Other non-current liabilities</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">7,094</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">7,094</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Redeemable, noncumulative, convertible preferred
  stock, $100<br>
&nbsp;&nbsp; par value; 1,171 shares issued and
  outstanding</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
111</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
111</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Stockholders' Equity (Deficit):</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Series B 12% cumulative, convertible preferred
  stock, $100 par<br>
&nbsp;&nbsp;&nbsp;&nbsp; value; 20,000 shares issued;
  aggregate liquidation preference<br>
&nbsp;&nbsp;&nbsp;&nbsp; of $2,660,000 </FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
<BR>
2,000</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
<BR>
2,000</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Series 2 $3.25 convertible, exchangeable Class
  C preferred<br>
&nbsp;&nbsp;&nbsp;&nbsp; stock, $50 stated value; 628,550
  shares issued; aggregate <br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; liquidation
  preference of $38,014,000</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
<BR>
31,427</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
<BR>
31,427</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Series D 6% cumulative, convertible Class C
  preferred stock,<br>
&nbsp;&nbsp;&nbsp;&nbsp; no par value; 1,000,000
  shares issued</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
1,000</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
1,000</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Common stock, $.10 par value; 75,000,000 shares
  authorized, <br>
&nbsp;&nbsp;&nbsp;&nbsp; 15,235,734 shares issued</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
1,524</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
1,524</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Capital in excess of par value</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">54,455</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">54,455</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Accumulated other comprehensive loss</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(1,932</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(1,932</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Accumulated deficit</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(75,530</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">3,458</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(2</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(3</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(72,072</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">12,944</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">3,458</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">16,402</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Less treasury stock, at cost:</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Series 2 preferred, 5,000 shares</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">200</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">200</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Common stock, 3,272,426 shares</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">16,068</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">16,068</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total stockholders' equity (deficit)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(3,324</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">3,458</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="9%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">134</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">169,013</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(6,783</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT><hr color="#000000"></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">162,230</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP"><font size="2">&nbsp;</font><hr color="#000000"></TD>
</TR>
</TABLE>

<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER"><BR>
See accompanying notes.</P>
<P ALIGN="CENTER">P-2</P>
</FONT><FONT SIZE=2><P ALIGN="JUSTIFY"></P>
</FONT><FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">LSB Industries, Inc.<BR>
<BR>
Unaudited Pro Forma Consolidated Statement of Operations<BR>
<BR>
Nine Months Ended September 30, 2002<BR>
<BR>
(In thousands, except per share amounts)</P>
</FONT>
<TABLE CELLSPACING=0 BORDER=0 WIDTH=686 cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
<TR><TD WIDTH="37%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="12%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER"><BR>
</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER"><BR>
<U>Historical</U></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">Pro Forma<BR>
<U>Adjustments</U></FONT></TD>
<TD WIDTH="7%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER"><BR>
<U>Pro Forma</U></FONT></TD>
</TR>
</TABLE>

<TABLE BORDER="0" CELLSPACING=0 WIDTH=686 cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Revenues:</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Net sales</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">225,574</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(7,338</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">218,236</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Gains on sales of property and equipment</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">37</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">37</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Other</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">1,593</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(8</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">1,585</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">227,204</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(7,346</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(5</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">219,858</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Costs and expenses:</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Cost of sales</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">188,511</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(6,416</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(5</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">182,095</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Selling general and administrative</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">35,878</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(4,786</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(5</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">31,092</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Interest</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">6,793</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(889</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(5</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(6</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">5,904</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Other</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">757</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(139</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(5</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">618</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Benefit from termination of firm purchase
  commitments</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(290</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(290</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">231,649</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(12,230</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">219,419</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Income (loss) before provision for income taxes and<br>
&nbsp; cumulative effect of accounting
 change</FONT></P>
  </TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<P ALIGN="CENTER">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
(4,445</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P><BR>
)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
4,884</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
439</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Provision for income taxes</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">22</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">22</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Income (loss) before cumulative effect of
  accounting change</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(4,467</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">$</FONT><hr color="#000000"></TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">4,884</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">417</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Loss before cumulative effect of accounting
 change<br>
&nbsp;&nbsp; applicable to common stock</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER"><BR>
$</FONT><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
(6,167</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P><BR>
)</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER"><BR>
$</FONT><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><BR>
(1,283</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P><BR>
)</FONT><hr color="#000000"></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Weighted average common shares:</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Basic and Diluted</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">11,943,856</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">11,943,856</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Loss per common share:</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Basic and Diluted:</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>  &nbsp;&nbsp;&nbsp;&nbsp;  Loss before cumulative effect of accounting
   change</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(0.51</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(0.11</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT><hr color="#000000"></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
</TABLE>

<FONT SIZE=2 face="Times New Roman"><P ALIGN="CENTER"><BR>
See accompanying notes.<br>
<br>
<br>
<br>
P-3</P>
</FONT><FONT FACE="Courier New" SIZE=1>
<P ALIGN="CENTER"><br>
<br>
&nbsp;</P>
</FONT>
<FONT FACE="Times New Roman" SIZE=2>
<P ALIGN="CENTER">LSB Industries, Inc.<BR>
<BR>
Unaudited Pro Forma Consolidated Statement of Operations<BR>
<BR>
Year Ended December 31, 2001<BR>
<BR>
(In thousands, except per share amounts)</P>
</FONT>
<TABLE CELLSPACING=0 BORDER=0 WIDTH=686 cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
<TR><TD WIDTH="37%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="12%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER"><BR>
</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER"><BR>
<U>Historical</U></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">Pro Forma<BR>
<U>Adjustments</U></FONT></TD>
<TD WIDTH="7%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER"><BR>
<U>Pro Forma</U></FONT></TD>
</TR>
</TABLE>

<TABLE BORDER="0" CELLSPACING=0 WIDTH=686 cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Revenues:</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Net sales</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">336,630</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">$</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(21,688</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">314,942</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Gains on sales of property and equipment</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">6,615</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">6,615</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Other</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">3,386</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(82</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">3,304</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">346,631</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(21,770</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(5</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">324,861</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Costs and expenses:</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Cost of sales</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">279,299</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(15,131</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(5</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">264,168</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Selling general and administrative</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">48,424</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(4,386</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(5</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">44,038</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Interest</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">14,114</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(1,436</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(5</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(6</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">12,678</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Other</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">1,446</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(250</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(5</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">1,196</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Benefit from termination of firm purchase
  commitments</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(2,688</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(2,688</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">340,595</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(21,203</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">319,392</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Income before provision for income taxes
  and extraordinary<br>
&nbsp; gain</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><br>
6,036</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><br>
(567</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P><br>
)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT"><br>
5,469</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Provision for income taxes</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">55</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">55</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Income before extraordinary gain</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">5,981</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">$</FONT><hr color="#000000"></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(567</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT><hr color="#000000"></TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">5,414</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Income before extraordinary gain applicable
 to common stock</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">3,714</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">3,147</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Weighted average commons shares:</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Basic</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">11,913,031</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">11,913,031</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Diluted</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">13,081,790</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">13,081,790</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>Income per common share:</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Basic:</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>  &nbsp;&nbsp;&nbsp;&nbsp;  Income before extraordinary gain</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">0.31</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">0.26</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P> &nbsp;&nbsp; Diluted:</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>  &nbsp;&nbsp;&nbsp;&nbsp;  Income before extraordinary gain</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">0.30</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER">$</FONT><hr color="#000000"></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">0.26</FONT><hr color="#000000"></TD>
<TD WIDTH="2%" VALIGN="TOP"><font face="Times New Roman" size="2">&nbsp;</font><hr color="#000000"></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="10%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="11%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
</TR>
</TABLE>

<FONT FACE="Times New Roman" SIZE=2><P ALIGN="CENTER"><BR>
See accompanying notes.</P>
</FONT>

<FONT FACE="Courier New" SIZE=1>
<P ALIGN="CENTER"><br>
<br>
</FONT>

<FONT FACE="Courier New" SIZE=2>P-4</P>
<p align="center"><br>
<br>
</FONT><FONT FACE="Times New Roman" SIZE=2>LSB Industries, Inc.<BR>
Notes to Unaudited Pro Forma Consolidated Financial Statements</p>
</FONT>
<FONT FACE="Courier New" SIZE=2>
<P><br>
<FONT FACE="Times New Roman" SIZE=2>
<U><br>
<br>
Unaudited Pro Forma Consolidated Balance Sheet</P>
</U></FONT>
</FONT>
<TABLE CELLSPACING=0 BORDER=0 WIDTH=630 cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
<TR><TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(1</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="90%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>To eliminate accounts receivable, inventory and net property, plant and equipment ("PP&amp;E") sold; the related PP&amp;E debt financing assumed by the purchaser; and, to apply cash proceeds to reduce the indebtedness of SEC/UTeC and the Company.</FONT></TD>
</TR>
<TR><TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="90%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(2</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="90%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>To recognize the gain on sale of the assets of SEC/UTeC.</FONT></TD>
</TR>
<TR><TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="90%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(3</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="90%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>To recognize the gain on extinguishment of debt relating to the required prepayment portion of the Company's debt under the Financing Agreement entered into on May 24, 2002.</FONT></TD>
</TR>
<TR><TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="90%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(4</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="90%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>To reflect the realization of assets and liquidation of liabilities retained.</FONT></TD>
</TR>
</TABLE>

<FONT FACE="Times New Roman" SIZE=2><P><BR>
<U>Unaudited Pro Forma Consolidated Statement of Operations</P>
</U></FONT>
<TABLE CELLSPACING=0 BORDER=0 WIDTH=630 cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
<TR><TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(5</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="90%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>To eliminate the results of operations of SEC/UTeC included in the Company's consolidated financial statements.</FONT></TD>
</TR>
<TR><TD WIDTH="3%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="90%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="3%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P ALIGN="RIGHT">(6</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>)</FONT></TD>
<TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="90%" VALIGN="TOP">
<FONT FACE="Times New Roman" SIZE=2><P>To recognize the interest reduction on debt retired with the net cash proceeds received by the Company</FONT></TD>
</TR>
</TABLE>

</BODY>
</HTML>
[{"type": "8-K", "sequence": "1", "filename": "lsb8k.htm", "description": "LSB 8K", "secsgml_size_bytes": 126748}]
{"company-data": {"conformed-name": "LSB INDUSTRIES INC", "cik": "0000060714", "assigned-sic": "2810", "irs-number": "731015226", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-07677", "film-number": "02869839"}, "business-address": {"street1": "16 S PENNSYLVANIA", "city": "OKLAHOMA CITY", "state": "OK", "zip": "73101", "phone": "4052354546"}, "mail-address": {"street1": "16 SOUTH PENNSYLVANIA", "city": "OKLAHOMA", "state": "OK", "zip": "73101"}}
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported)
December 12, 2002	9;
LSB INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
Delaware
1-7677
73-1015226
(State or other	                                                 (Commission File 	                                                       (IRS Employer
jurisdiction of	                                                     Number) 	                                                                  Identification No.)
incorporation)
16 South Pennsylvania Avenue, Oklahoma City, Oklahoma
73107
(Address of principal executive offices)	     (Zip Code)
Registrant's telephone number, including area code
(405) 235-4546
Not applicable
(Former name or former address, if changed since last report)
Item 2.
Acquisition or Disposition of Assets
.
On December 12, 2002, Slurry Explosive Corporation ("SEC") and Universal Tech Corporation ("UTeC"), each an Oklahoma corporation and an indirect, wholly owned subsidiary of LSB Industries, Inc. (the "Company") (SEC and UTeC, collectively, are the "Sellers") consummated the sale (the "Sale") by Sellers of substantially all of their assets to four wholly owned subsidiaries of Energetic Systems Inc., LLC (ESI"), a Nevada limited liability company (collectively, the "Buyers"), pursuant to the terms of an Asset Purchase Agreement, dated December 6, 2002 (the "Purchase Agreement").
The assets sold by the Sellers comprised of substantially all of the explosives distribution business within the Company's chemical business. SEC and one of the four Buyers jointly own Slurry Explosive Manufacturing Corporation.  During 2001 and the first nine months of 2002, the Sellers' revenues were approximately $22 million and $7.4 million, respectively.
The purchase price ("Purchase Price") paid by the Buyers to the Sellers under the Purchase Agreement at the closing of the Sale was approximately $10.2 million, determined by a base price of $7 million, plus approximately $2.7 for inventory and accounts receivable and $425,000 of assumed liabilities under an equipment lease.  Of the proceeds from the Sale, (a) approximately $250,000 was placed in escrow, (b) approximately $3.5 million was paid to a term lender, and (c) the balance of the proceeds were applied against the Company's revolving line of credit.  On or about March 4, 2003, the portion of the escrow funds equal to the amount of the accounts receivable purchased by the Buyers that are not collected will be paid to the Buyers, and the balance of the escrow funds will be released to the Sellers.  In connection with the disbursement of the escrow funds, the Buyers will assign such uncollected accounts receivable to the Sellers.
The Company may, from time to time, borrow funds under its revolving line of credit based on the amount of eligible collateral.  Immediately after the pay down under the Company's revolving line of credit, the
unused borrowing availability under the credit facility was approximately $8.2 million based on eligible collateral as of that date.
Item 7.
Financial Statements and Exhibits
.
Page No.
(a)
Pro Forma Financial Information
.				9;
Pro Forma Condensed Consolidated Balance Sheet
(Unaudited) as of September 30, 2002                                                     			P-
2
Pro Forma Consolidated Statement of
Operations (Unaudited) for the Nine
Months Ended September 30, 2002                                                         				P-3
-2-
Pro Forma Consolidated Statement of
Operations (Unaudited) for the Year
Ended December 31, 2001                                                                         					P-4
Notes to Pro Forma Consolidated Financial
Statements (Unaudited)                                                                             					P-5
(c)         	Exhibits.
2.1         	Asset Purchase Agreement, dated as of December 6, 2002, by and among Energetic Systems Inc. LLC, UTeC Corporation, LLC, SEC Investment Corp. LLC, DetaCorp Inc. LLC, Energetic Properties, LLC, Slurry Explosive Corporation, Universal Tech Corporation, El Dorado Chemical Company, LSB Chemical Corp., LSB Industries, Inc. and Slurry Explosive Manufacturing Corporation, LLC.
The Asset Purchase Agreement contains a brief list identifying all schedules and exhibits to the Asset Purchase Agreement.  Such schedules and exhibits are not filed herewith, and the Registrant agrees to furnish supplementally a copy of the omitted schedules and exhibits to the Commission upon request.
SIGNATURES
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 hereunto duly authorized.
Dated: December 27, 2002.
LSB INDUSTRIES, INC.
By:
/s/
Tony M. Shelby
Tony M. Shelby,
Senior Vice President and
(Chief Financial Officer)
-3-
LSB Industries, Inc.
Unaudited Pro Forma Financial Information
December 12, 2002
On December 12, 2002 LSB Industries, Inc., (the "Company") and its subsidiaries, Slurry Explosive Corporation ('SEC") and Universal Technology Corporation ("UTeC") completed an agreement to sell substantially all the assets of SEC and UTeC (collectively, "SEC/UTeC").  Under the agreement, SEC/UTeC retains all of their liabilities, except liabilities for the financing of certain property and equipment, and will liquidate such liabilities retained from the proceeds of the sale (the "Transaction").
The accompanying unaudited pro forma consolidated balance sheet as of September 30, 2002 gives effect to the Transaction involving the Company's wholly owned subsidiaries SEC/UTeC, as if it had occurred on September 30, 2002. The accompanying unaudited consolidated statements of operations for the year ended December 31, 2001 and the nine months ended September 30, 2002 give effect to the sale and realization of the assets of SEC/UTeC as if the Transaction had occurred as of January 1, 2001. Such unaudited pro forma consolidated financial information has been prepared based on estimates and assumptions deemed by the Company to be appropriate and does not purport to be indicative of the financial position or results of operations which may actually be obtained in the future. Future results may vary significantly from the results reflected in the unaudited pro forma consolidated statements of operations of the Company and its other retained subsidiaries due to general economic conditions and other factors.
The pro forma consolidated financial information should be read in conjunction with the Company's historical financial statements and Management's Discussion and Analysis of Financial Condition and Results of Operations in the Company's Annual Report on Form 10-K for the year ended December 31, 2001 and Quarterly report on Form 10-Q for the nine months ended September 30, 2002.
P-1
LSB Industries, Inc.
Unaudited Pro Forma Consolidated Balance Sheet
September 30, 2002
(In thousands)
Historical
Pro Forma
Adjustments
Pro Forma
Assets
Current assets:
Cash and cash equivalents
$
687
$
687
Trade accounts and notes receivable, net
39,994
$
(1,023
)
38,971
Inventories
24,647
(1,306
)
23,341
Supplies and prepaid items
7,582
(65
)
7,517
Total current assets
72,910
(2,394
)
(1
)
(4
)
70,516
Property, plant and equipment, at cost
159,179
(7,495
)
151,684
Less accumulated depreciation and
amortization
79,225
(3,172
)
76,053
79,954
(4,323
)
(1
)
75,631
Other assets, net
16,149
(66
)
(1
)
(4
)
16,083
$
169,013
$
(6,783
)
$
162,230
Liabilities and Stockholders' Equity (Deficit)
Current liabilities:
Accounts and drafts payable
$
25,984
$
(818
)
(4
)
$
25,166
Accrued liabilities
15,318
(296
)
(1
)
(4
)
15,022
Current portion of long-term debt
43,116
(4,451
)
(1
)
(3
)
38,665
Total current liabilities
84,418
(5,565
)
78,853
Long-term debt
80,714
(4,676
)
(1
)
(3
)
76,038
Other non-current liabilities
7,094
7,094
Redeemable, noncumulative, convertible preferred
  stock, $100
par value; 1,171 shares issued and
  outstanding
111
111
Stockholders' Equity (Deficit):
Series B 12% cumulative, convertible preferred
  stock, $100 par
value; 20,000 shares issued;
  aggregate liquidation preference
of $2,660,000
2,000
2,000
Series 2 $3.25 convertible, exchangeable Class
  C preferred
stock, $50 stated value; 628,550
  shares issued; aggregate
liquidation
  preference of $38,014,000
31,427
31,427
Series D 6% cumulative, convertible Class C
  preferred stock,
no par value; 1,000,000
  shares issued
1,000
1,000
Common stock, $.10 par value; 75,000,000 shares
  authorized,
15,235,734 shares issued
1,524
1,524
Capital in excess of par value
54,455
54,455
Accumulated other comprehensive loss
(1,932
)
(1,932
)
Accumulated deficit
(75,530
)
3,458
(2
)
(3
)
(72,072
)
12,944
3,458
16,402
Less treasury stock, at cost:
Series 2 preferred, 5,000 shares
200
200
Common stock, 3,272,426 shares
16,068
16,068
Total stockholders' equity (deficit)
(3,324
)
3,458
134
$
169,013
$
(6,783
)
$
162,230
See accompanying notes.
P-2
LSB Industries, Inc.
Unaudited Pro Forma Consolidated Statement of Operations
Nine Months Ended September 30, 2002
(In thousands, except per share amounts)
Historical
Pro Forma
Adjustments
Pro Forma
Revenues:
Net sales
$
225,574
$
(7,338
)
$
218,236
Gains on sales of property and equipment
37
-
37
Other
1,593
(8
)
1,585
227,204
(7,346
)
(5
)
219,858
Costs and expenses:
Cost of sales
188,511
(6,416
)
(5
)
182,095
Selling general and administrative
35,878
(4,786
)
(5
)
31,092
Interest
6,793
(889
)
(5
)
(6
)
5,904
Other
757
(139
)
(5
)
618
Benefit from termination of firm purchase
  commitments
(290
)
-
(290
)
231,649
(12,230
)
219,419
Income (loss) before provision for income taxes and
cumulative effect of accounting
 change
(4,445
)
4,884
439
Provision for income taxes
22
-
22
Income (loss) before cumulative effect of
  accounting change
$
(4,467
)
$
4,884
$
417
Loss before cumulative effect of accounting
 change
applicable to common stock
$
(6,167
)
$
(1,283
)
Weighted average common shares:
Basic and Diluted
11,943,856
11,943,856
Loss per common share:
Basic and Diluted:
Loss before cumulative effect of accounting
   change
$
(0.51
)
$
(0.11
)
See accompanying notes.
P-3
LSB Industries, Inc.
Unaudited Pro Forma Consolidated Statement of Operations
Year Ended December 31, 2001
(In thousands, except per share amounts)
Historical
Pro Forma
Adjustments
Pro Forma
Revenues:
Net sales
$
336,630
$
(21,688
)
$
314,942
Gains on sales of property and equipment
6,615
-
6,615
Other
3,386
(82
)
3,304
346,631
(21,770
)
(5
)
324,861
Costs and expenses:
Cost of sales
279,299
(15,131
)
(5
)
264,168
Selling general and administrative
48,424
(4,386
)
(5
)
44,038
Interest
14,114
(1,436
)
(5
)
(6
)
12,678
Other
1,446
(250
)
(5
)
1,196
Benefit from termination of firm purchase
  commitments
(2,688
)
-
(2,688
)
340,595
(21,203
)
319,392
Income before provision for income taxes
  and extraordinary
gain
6,036
(567
)
5,469
Provision for income taxes
55
-
55
Income before extraordinary gain
$
5,981
$
(567
)
$
5,414
Income before extraordinary gain applicable
 to common stock
$
3,714
$
3,147
Weighted average commons shares:
Basic
11,913,031
11,913,031
Diluted
13,081,790
13,081,790
Income per common share:
Basic:
Income before extraordinary gain
$
0.31
$
0.26
Diluted:
Income before extraordinary gain
$
0.30
$
0.26
See accompanying notes.
P-4
LSB Industries, Inc.
Notes to Unaudited Pro Forma Consolidated Financial Statements
Unaudited Pro Forma Consolidated Balance Sheet
(1
)
To eliminate accounts receivable, inventory and net property, plant and equipment ("PP&E") sold; the related PP&E debt financing assumed by the purchaser; and, to apply cash proceeds to reduce the indebtedness of SEC/UTeC and the Company.
(2
)
To recognize the gain on sale of the assets of SEC/UTeC.
(3
)
To recognize the gain on extinguishment of debt relating to the required prepayment portion of the Company's debt under the Financing Agreement entered into on May 24, 2002.
(4
)
To reflect the realization of assets and liquidation of liabilities retained.
Unaudited Pro Forma Consolidated Statement of Operations
(5
)
To eliminate the results of operations of SEC/UTeC included in the Company's consolidated financial statements.
(6
)
To recognize the interest reduction on debt retired with the net cash proceeds received by the Company