UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

Form 10-K/A

(Amendment No. 2)

|(Mark One)                                  |                                                                                         
|------------------------------------------- | ----------------------------------------------------------------------------------------
|ý                                           | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934    
|For the fiscal year ended December 31, 2007
|o                                           | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 000-51552

ATS CORPORATION(Exact name of Registrant as specified in its charter)

|Delaware(State or other jurisdiction of incorporation or organization)           |  | 11-3747850(I.R.S. Employer Identification Number)
|-------------------------------------------------------------------------------- |  | -------------------------------------------------
|7915 Jones Branch Drive
McLean, Virginia(Address of principal executive offices) |  | 22102(zip code)                                  

Registrant's telephone number, including area code: (703) 506-0088

Securities Registered Pursuant to Section 12(b) of the Act:

NONE

Securities Registered Pursuant to Section 12(g) of the Act:

Title of Each Class

Name of Exchange on Which RegisteredCommon Stock, $0.0001 par value

OTCBB


Units, each consisting of one share of Common Stock, $0.0001 par value, and two Warrants
Common Stock, $0.0001 par value
Warrants to purchase shares of Common Stock (Title Of Class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities
Act. Yes o    No ý

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the
Act. Yes o    No ý

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the
past 90 days. Yes ý    No o

Indicate by a check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not
be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K. o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting
company. See the definitions of "large accelerated filer", "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o

Accelerated filer ý

Non-accelerated filer o

Smaller reporting company o


Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act). Yes o    No ý

As of June 30, 2007, the aggregate market value of the Registrant's Common Stock held by non-affiliates of the Registrant was
$2.5 million, based on the closing sales price of the Registrant's Common Stock on the OTC Bulletin Board on that date.

As
of March 11, 2008, 19,251,777 shares of the Registrant's common stock, $0.0001 par value, were outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Part III incorporates information by reference from the definitive proxy statement for the Annual Meeting of Stockholders expected to be
held in May 2008.



---





EXPLANATORY NOTE

This Amendment No. 2 to our Annual Report on Form 10-K for the fiscal year ended December 31, 2007, initially filed on
March 17, 2008 and Amendment No. 1 filed on March 21, 2008, is being filed for the primary purpose of correcting inadvertent typographical errors on the Reports of Independent
Registered Public Accounting Firm (the "Report"), to add the name and conformed signature of Grant Thornton LLP. In addition, the following changes are being made: (i) an adjustment to
the table header of the "Consolidated Statements of Comprehensive Income (Loss)" for ATS Corporation; and (ii) a reference to such table in the Report of Independent Registered Public
Accounting Firm by Eisner LLP.

Except
as described above, no other amendments are being made to the Annual Report. This Form 10-K/A does not reflect events occurring after the March 17, 2008
filing of our Annual Report or modify or update the disclosure contained in the Annual Report in any way other than as required to reflect the amendment discussed above and reflected below. We are
including in this amendment Item 15Exhibits and Financial Statement Schedules in its entirety. While the remainder of the Report is unchanged, we are filing Item 15 in its
entirety to provide a complete presentation, as well as Exhibits 23.1, 23.2, 23.3, the consents of accountants and Exhibits 31.1, 31.2, 32.1 and 32.2., the certifications of the
Principal Executive Officer and Principal Financial Officer.

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PART IV

Item 15.Exhibits and Financial Statement Schedules



The
following exhibits are included with this report or incorporated herein by reference:

|Exhibit
Number |  | Description                                                                                                                                                                                                                                                                                                                            
|-------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2.1            |  | Stock Purchase Agreement dated April 19, 2006 among Federal Services Acquisition Corporation, Advanced Technology Systems, Inc. and the shareholders of Advanced Technology Systems, Inc. ("ATSI") (included as Annex A to the
Definitive Proxy Statement (No. 000-51552) dated December 11, 2006 and incorporated by reference herein)
|2.2            |  | First Amendment to ATSI Stock Purchase Agreement (included as Annex A-1 to the Definitive Proxy Statement (No. 000-51552) dated December 11, 2006 and incorporated by reference herein)                                                                                                                                                
|2.3            |  | Second Amendment to ATSI Stock Purchase Agreement (included as Annex A-2 to the Definitive Proxy Statement (No. 000-51552) dated December 11, 2006 and incorporated by reference herein)                                                                                                                                               
|2.4            |  | Third Amendment to ATSI Stock Purchase Agreement (included as Annex A-3 to the Definitive Proxy Statement (No. 000-51552) dated December 11, 2006 and incorporated by reference herein)                                                                                                                                                

50

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|2.5  |  | Stock Purchase Agreement dated as of August 24, 2007 by and among ATS Corporation, Potomac Management Group, Inc. and the Shareholders of Potomac Management Group, Inc. (incorporated by reference to Exhibit 2.1 to a Current Report
on Form 8-K filed on September 7, 2007)                                                          
|---- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2.6  |  | Agreement and Plan of Merger and Reorganization, dated as of October 12, 2007, by and among ATS Corporation, ATS NSS Acquisition, Inc., Number Six Software, Inc., and the Principal Stockholders of Number Six Software, Inc.
(incorporated by reference to Exhibit 2.1 to a Current Report on Form 8-K filed on October 16, 2007)     
|3.1  |  | Second Amended and Restated Certificate of Incorporation dated January 16, 2007 (incorporated by reference to Exhibit 3.1 to a Current Report on Form 8-K filed January 19, 2007)                                                                                                                                                       
|3.2  |  | Amended By-laws (incorporated by reference to Exhibit 3.1 to a Current Report on Form 8-K filed December 19, 2007)                                                                                                                                                                                                                      
|4.1  |  | Specimen Unit Certificate (incorporated by reference to Exhibit 4.1 in our Annual Report on Form 10-K filed March 31, 2006)                                                                                                                                                                                                             
|4.2  |  | Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.2 in our Annual Report on Form 10-K filed March 31, 2006)                                                                                                                                                                                                     
|4.3  |  | Specimen Warrant Certificate (incorporated by reference to Exhibit 4.3 in our Annual Report on Form 10-K filed March 31, 2006)                                                                                                                                                                                                          
|4.4  |  | Warrant Agreement between Continental Stock Transfer & Trust Company and the Company (incorporated by reference to Exhibit 4.4 in our Annual Report on Form 10-K filed March 31, 2006)                                                                                                                                                  
|4.5  |  | Warrant Clarification Agreement between Continental Stock Transfer & Trust Company and the Company (incorporated by reference to Exhibit 4.1 to a Warrant Report on Form 8-K filed March 14, 2007)                                                                                                                                      
|10.1 |  | Credit Agreement with Bank of America dated June 4, 2007 (incorporated by reference to Exhibit 10.1 on a Form 8-K filed June 8, 2007)                                                                                                                                                                                                   
|10.2 |  | Amendment No. 1 to Credit Agreement with Bank of America dated June 29, 2007 (incorporated by reference to Exhibit 10.1 for the Quarterly Report on Form 10-Q filed November 8, 2007)                                                                                                                                                   
|10.3 |  | Amendment No. 2 to Credit Agreement with Bank of America dated November 9, 2007 (incorporated by reference to Exhibit 10.1 to a Current Report on Form 8-K filed November 13, 2007)                                                                                                                                                     
|10.4 |  | Balance Sheet Escrow Agreement among Federal Services Acquisition Corporation, certain shareholders of Advanced Technology Systems, Inc. and Branch Banking and Trust Company as Escrow Agent (included as Annex B-1 to the Definitive Proxy
Statement (No. 000-51552) dated December 11, 2006 and incorporated by reference herein)    
|10.5 |  | General Indemnity Escrow Agreement among Federal Services Acquisition Corporation, certain shareholders of Advanced Technology Systems, Inc. and Branch Banking and Trust Company as Escrow Agent (included as Annex B-2 to the Definitive Proxy
Statement (No. 000-51552) dated December 11, 2006 and incorporated by reference herein)

51

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|10.6   |  | Expense Escrow Agreement among Federal Services Acquisition Corporation, certain shareholders of Advanced Technology Systems, Inc. and Branch Banking and Trust Company as Escrow Agent (included as Annex B-3 to the Definitive Proxy Statement
(No. 000-51552) dated December 11, 2006 and incorporated by reference herein)                        
|------ |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.7   |  | Accounting Method Tax Escrow Agreement among Federal Services Acquisition Corporation, certain shareholders of Advanced Technology Systems, Inc. and Branch Banking and Trust Company as Escrow Agent (included as Annex B-4 to the Definitive
Proxy Statement (No. 000-51552) dated December 11, 2006 and incorporated by reference herein)          
|10.8   |  | Form of Registration Rights Agreement among Federal Services Acquisition Corporation and each of the Initial Stockholders (incorporated by reference to Exhibit 10.14 to Form S-1/A filed July 29, 2005)                                                                                                                                              
|10.9   |  | Registration Rights Agreement among Federal Services Acquisition Corporation and certain shareholders of Advanced Technology Systems, Inc. (included as Annex C to the Definitive Proxy Statement (No. 000-51552) dated December 11,
2006 and incorporated by reference herein)                                                                       
|10.10* |  | Registration Rights Agreement among ATS Corporation and the Principal Stockholders of Number Six Software, Inc. dated November 9, 2007                                                                                                                                                                                                                
|10.11  |  | ATS Corporation 2006 Omnibus Incentive Compensation Plan, as amended (incorporated by reference, to Exhibit 99.1 to Form S-8 filed September 14, 2007)                                                                                                                                                                                                
|10.12  |  | ATS Corporation 2007 Employee Stock Purchase Plan (incorporated by reference to Exhibit 99.2 to Form S-8 filed September 14, 2007)                                                                                                                                                                                                                    
|10.13  |  | Contract dated July 24, 2006, as modified September 29, 2006, under which Advanced Technology Systems, Inc. provides IT contractor support to mission areas under cognizance of the Office of the Secretary of Defense (incorporated by
reference to Exhibit 10.11 on a Current Report on Form 8-K filed January 19, 2007)                            
|10.14  |  | Contract, as modified October 2006, between Advanced Technology Systems, Inc. Public Safety Solutions Division and the Metropolitan Nashville Police Department (MNPD) with respect to Advanced Records Management System (ARMS) project
(incorporated by reference to Exhibit 10.12 on a Current Report on Form 8-K filed January 19, 2007)          
|10.15  |  | Lease dated June 22, 1998 under which Advanced Technology Systems, Inc. leases the Registrant's principal executive offices, at 7915 Jones Branch Drive, McLean, VA 22102, from West*Group Properties, LLC for a term expiring on
January 31, 2009 (incorporated by reference to Exhibit 10.13 on a Current Report on Form 8-K filed January 19, 2007)
|10.16  |  | Employment Agreement with Dr. Edward H. Bersoff dated March 19, 2007 (incorporated by reference to Exhibit 10.1 on a Current Report on From 8-K filed March 21, 2007)                                                                                                                                                                                 
|10.17  |  | Amended and Restated Employment Agreement by and between ATS Corporation and Dr. Edward H. Bersoff, dated October 25, 2007 (incorporated by reference to Exhibit 10.1 to a Current Report on Form 8-K filed on October 29,
2007)                                                                                                                      
|10.18  |  | Restricted Share Award Agreement with Dr. Edward H. Bersoff dated March 19, 2007 (incorporated by reference to Exhibit 10.2 on a Current Report on Form 8-K filed March 21, 2007)                                                                                                                                                                     
|10.19  |  | Restricted Share Award Agreement with Pamela A. Little dated May 4, 2007 (incorporated by reference to Exhibit 10.2 to our Form 10-Q filed on August 9, 2007)                                                                                                                                                                                         

52

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|10.20  |  | Restricted Share Award Agreement with George Troendle dated June 18, 2007 (incorporated by reference to Exhibit 10.3 to our Form 10-Q filed on August 9, 2007)                                                                                                                
|------ |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.21  |  | Restricted Share Award Agreement with Ginger Lew dated June 18, 2007 (incorporated by reference to Exhibit 10.4 to our Form 10-Q filed on August 9, 2007)                                                                                                                     
|10.22  |  | Restricted Share Award Agreement with Joseph A. Saponaro dated March 29, 2007 (incorporated by reference to Exhibit 10.5 to our Form 10-Q filed on August 9, 2007)                                                                                                            
|10.23  |  | Restricted Share Award Agreement with Edward J. Smith dated March 29, 2007 (incorporated by reference to Exhibit 10.6 to our Form 10-Q filed on August 9, 2007)                                                                                                               
|10.24* |  | Restricted Share Award Agreement with Pamela A. Little dated December 17, 2007                                                                                                                                                                                                
|10.25* |  | Restricted Share Award Agreement with Dr. Edward H. Bersoff dated December 17, 2007                                                                                                                                                                                           
|10.26  |  | Employment Agreement with Pamela A. Little dated February 3, 2008 (incorporated by reference to Exhibit 10.1 on a Current Report on Form 8-K filed February 6, 2008)                                                                                                          
|10.27  |  | Deed of Lease between West*Group Properties, LLC and ATS Corporation, dated February 11, 2008, for the property located at 7925 Jones Branch Drive, McLean, Virginia 22102 (incorporated by reference to Exhibit 10.1 on a Current Report
on Form 8-K filed February 14, 2008)
|23.1   |  | Consent of Eisner LLP regarding ATS Corporation financial statements for the years ended December 31, 2006 and 2005                                                                                                                                                           
|23.2   |  | Consent of Grant Thornton LLP regarding ATSI financial statements for the two years ended October 31, 2006                                                                                                                                                                    
|23.3   |  | Consent of Grant Thornton LLP regarding ATS Corporation financial statements for the year ended December 31, 2007                                                                                                                                                             
|31.1   |  | Certification of Principal Executive Officer pursuant to Rule 13a-14(a)/15(d)-19(a) of the Securities Exchange Act of 1934, as amended                                                                                                                                        
|31.2   |  | Certification of Principal Financial Officer pursuant to Rule 13a-14(a)/15(d)-19(a) of the Securities Exchange Act of 1934, as amended                                                                                                                                        
|32.1   |  | Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                        
|32.2   |  | Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                        

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53

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board
of Directors and Shareholders
ATS Corporation

We
have audited the accompanying consolidated balance sheet of ATS Corporation (a Delaware corporation) as of December 31, 2007, and the related consolidated statements of
operations, comprehensive loss, shareholders' equity and cash flows for the year ended December 31, 2007. Our audit of the basic financial statements included the financial statement schedule
listed in the index appearing under Item 15(a)(2). We also have audited ATS Corporation's internal control over financial reporting as of December 31, 2007, based on criteria established
inInternal ControlIntegrated Frameworkissued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ATS
Corporation's management is responsible for these financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal
control over financial reporting, included in the accompanying Management's Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on these financial
statements and financial statement schedule and an opinion on ATS Corporation's internal control over financial reporting based on our audits.

We
conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to
obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material
respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an
understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control
based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our
opinions.

A
company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures
that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide
reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because
of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future
periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In
our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of ATS Corporation as of December 31, 2007, and the
results of its operations and its cash flows for the year ended December 31, 2007 in conformity with accounting principles generally accepted in the United States of America. Also in our
opinion, the related financial statement

F-1

---



schedule,
when considered in relation to the basic financial statements taken as a whole, present fairly, in all material respects, the information set forth therein.

In
our opinion, ATS Corporation maintained, in all material respects, effective internal control over financial reporting as of December 31, 2007, based on criteria established in Internal ControlIntegrated
Frameworkissued by COSO.

As
discussed in Note 16 to the consolidated financial statements, in 2007, ATS Corporation adopted Financial Accounting Standards Board Interpretation No. 48, Accounting for Uncertainty in Income Taxes an interpretation
of FASB Statement No. 109.



McLean,
Virginia
March 17, 2008

F-2

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Report of Independent Registered Public Accounting Firm

Board
of Directors and Shareholders of
ATS Corporation

We
have audited the accompanying balance sheet of ATS Corporation (formerly Federal Services Acquisition Corporation) (a development stage company) as of December 31, 2006, and
the related statements of operations, changes in shareholders' equity and comprehensive income (loss), and cash flows for the year ended December 31, 2006, and for the period from
April 12, 2005 (date of inception) through December 31, 2005. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion
on these financial statements based on our audits.

We
conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our opinion.

In
our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of ATS Corporation as of December 31, 2006, and the
results of its operations and its cash flows for the year ended December 31, 2006 and for the period from April 12, 2005 (date of inception) through December 31, 2005 in conformity with
U.S. generally accepted accounting principles.

/s/
Eisner LLP
New York, New York
March 20, 2007

F-3

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REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

Board
of Directors and Shareholders
Advanced Technology Systems, Inc., and Subsidiaries

We
have audited the accompanying consolidated balance sheets of Advanced Technology Systems, Inc., and Subsidiaries (the Company) as of January 15, 2007 and
October 31, 2006, and the related consolidated statements of operations, changes in stockholders' equity, and cash flows for the period November 1, 2006 through January 15, 2007
and each of the two years in the period ended October 31, 2006. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on
these financial statements based on our audits.

We
conducted our audits in accordance with the standards generally accepted in the United States of America, as established by the American Institute of Certified Public Accountants.
Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes consideration of
internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion of the effectiveness of
the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used, and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.

In
our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Advanced Technology
Systems, Inc., and Subsidiaries as of January 15, 2007 and October 31, 2006, and the consolidated results of its operations and its cash flows for the period November 1,
2006 through January 15, 2007 and each of the two years in the period ended October 31, 2006 in conformity with accounting principles generally accepted in the United States of America.



McLean,
Virginia
March 13, 2008

F-4

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ATS CORPORATION        CONSOLIDATED STATEMENTS OF OPERATIONS

|                                                      |                                              | ATS Corporation
(Successor) |             | ATSI
(Predecessor) |  
|----------------------------------------------------- | -------------------------------------------- | --------------------------- | ----------- | ------------------ | -
|
|
|
|
|Revenue                                               |                                              | $                           | 106,887,039 |                    | $
|Operating costs and expenses                          |                                              |                             |             |                    |  
|                                                      | Direct costs                                 |                             |             | 75,010,192         |  
|                                                      | Selling, general and administrative expenses |                             |             | 25,925,693         |  
|                                                      | Depreciation and amortization                |                             |             | 4,877,244          |  
|Total operating costs and expenses                    |                                              |                             | 105,813,129 |                    |  
|                                                      |                                              |                             |             |                    |  
|Operating income (loss)                               |                                              |                             | 1,073,910   |                    |  
|Other (expense) income                                |                                              |                             |             |                    |  
|                                                      | Interest income (expense), net               |                             |             | (492,722           | )
|                                                      | Gain (loss) on warrant liabilities           |                             |             | (6,930,000         | )
|                                                      | Other income                                 |                             |             | 248,612            |  
|                                                      |                                              |                             |             |                    |  
|(Loss) income before income taxes                     |                                              | $                           | (6,100,200  | )                  | $
|Income tax (benefit) expense                          |                                              |                             | 453,529     |                    |  
|                                                      |                                              |                             |             |                    |  
|Income (loss) from continuing operations              |                                              | $                           | (6,553,729  | )                  | $
|                                                      |                                              |                             |             |                    |  
|Loss from discontinued operations                     |                                              |                             |            |                    |  
|                                                      |                                              |                             |             |                    |  
|Net (loss) income                                     |                                              | $                           | (6,553,729  | )                  | $
|                                                      |                                              |                             |             |                    |  
|Gain on derivative liabilities attributed to warrants |                                              |                             |            |                    |  
|Net income (loss)                                     |                                              | $                           | (6,553,729  | )                  | $
|Weighted average number of shares outstanding         |                                              |                             |             |                    |  
|                                                      | basic                                       |                             |             | 18,848,722         |  
|                                                      | dilutive                                    |                             |             | 18,848,722         |  
|Basic net income (loss) per share                     |                                              |                             |             |                    |  
|                                                      | Continuing operations                       |                             | $           | (0.35              | )
|                                                      | Discontinued operations                     |                             |             |                   |  
|                                                      | Net income (loss)                           |                             |             | (0.35              | )
|Diluted net income (loss) per share                   |                                              |                             |             |                    |  
|                                                      | Continuing operations                       |                             | $           | (0.35              | )
|                                                      | Discontinued operations                     |                             |             |                   |  
|                                                      | Net income (loss)                           |                             |             | (0.35              | )

The accompanying notes are an integral part of these consolidated financial statements.

F-5

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ATS CORPORATION        CONSOLIDATED BALANCE SHEETS

|                                                                                                                                                                                                         |                                           | ATS Corporation
Successor |             | ATSI
Predecessor |  
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------- | ------------------------- | ----------- | ---------------- | -
|
|
|
|ASSETS                                                                                                                                                                                                   |                                           |                           |             |                  |  
|Current assets:                                                                                                                                                                                          |                                           |                           |             |                  |  
|                                                                                                                                                                                                         | Cash and cash equivalents                 |                           | $           | 1,901,977        |  
|                                                                                                                                                                                                         | Accounts receivable, net                  |                           |             | 31,191,784       |  
|                                                                                                                                                                                                         | Prepaid expenses and other current assets |                           |             | 923,803          |  
|                                                                                                                                                                                                         | Income tax receivable                     |                           |             | 3,493,319        |  
|                                                                                                                                                                                                         | Other current assets                      |                           |             | 16,663           |  
|                                                                                                                                                                                                         | Assets held for sale                      |                           |             |                 |  
|                                                                                                                                                                                                         | Deferred income taxes, current            |                           |             | 1,335,965        |  
|                                                                                                                                                                                                         |                                           |                           |             |                  |  
|Total current assets                                                                                                                                                                                     |                                           |                           | 38,863,511  |                  |  
|Property and equipment, net                                                                                                                                                                              |                                           |                           | 1,501,409   |                  |  
|Goodwill                                                                                                                                                                                                 |                                           |                           | 107,600,686 |                  |  
|Intangible assets, net                                                                                                                                                                                   |                                           |                           | 21,446,868  |                  |  
|Deferred acquisition costs                                                                                                                                                                               |                                           |                           |            |                  |  
|Short-term investments held in trust account (including interest receivable of $89,737) (fair value of $121,024,475)                                                                                     |                                           |                           |            |                  |  
|Restricted cash                                                                                                                                                                                          |                                           |                           | 1,278,489   |                  |  
|Cash and cash equivalents held in trust fund                                                                                                                                                             |                                           |                           |            |                  |  
|Other assets                                                                                                                                                                                             |                                           |                           | 259,353     |                  |  
|Deferred income tax benefit                                                                                                                                                                              |                                           |                           |            |                  |  
|                                                                                                                                                                                                         |                                           |                           |             |                  |  
|Total assets                                                                                                                                                                                             |                                           | $                         | 170,950,316 |                  | $
|                                                                                                                                                                                                         |                                           |                           |             |                  |  
|LIABILITIES AND SHAREHOLDERS' EQUITY                                                                                                                                                                     |                                           |                           |             |                  |  
|Current liabilities:                                                                                                                                                                                     |                                           |                           |             |                  |  
|                                                                                                                                                                                                         | Current portion of long-term debt         |                           |             | 2,820,191        |  
|                                                                                                                                                                                                         | Capital leasescurrent portion            |                           |             | 96,558           |  
|                                                                                                                                                                                                         | Accounts payable and accrued expenses     |                           |             | 8,634,665        |  
|                                                                                                                                                                                                         | Accrued salaries and related taxes        |                           |             | 4,425,966        |  
|                                                                                                                                                                                                         | Accrued vacation                          |                           |             | 2,479,540        |  
|                                                                                                                                                                                                         | Income taxes payable                      |                           |             | 1,926,225        |  
|                                                                                                                                                                                                         | Warrant liabilities                       |                           |             |                 |  
|                                                                                                                                                                                                         | Deferred revenue                          |                           |             | 2,164,574        |  
|                                                                                                                                                                                                         | Deferred income taxes, current            |                           |             |                 |  
|                                                                                                                                                                                                         | Deferred rentcurrent portion             |                           |             | 80,984           |  
|                                                                                                                                                                                                         |                                           |                           |             |                  |  
|Total current liabilities                                                                                                                                                                                |                                           |                           | 22,628,703  |                  |  
|Long-term debtnet of current portion                                                                                                                                                                    |                                           |                           | 45,604,958  |                  |  
|Capital leasesnet of current portion                                                                                                                                                                    |                                           |                           | 87,078      |                  |  
|Deferred rentnet of current portion                                                                                                                                                                     |                                           |                           | 94,069      |                  |  
|Other long-term liabilities                                                                                                                                                                              |                                           |                           | 724,654     |                  |  
|Deferred income taxes                                                                                                                                                                                    |                                           |                           | 6,475,540   |                  |  
|                                                                                                                                                                                                         |                                           |                           |             |                  |  
|Total liabilities                                                                                                                                                                                        |                                           |                           | 75,615,002  |                  |  
|Common stock, subject to possible redemption 4,197,900 shares                                                                                                                                            |                                           |                           |            |                  |  
|Interest income attributable to common stock subject to possible redemption (net of taxes of $0 and $561,204, respectively)                                                                              |                                           |                           |            |                  |  
|                                                                                                                                                                                                         |                                           |                           |             |                  |  
|Total common stock subject to redemption                                                                                                                                                                 |                                           |                           |            |                  |  
|                                                                                                                                                                                                         |                                           |                           |             |                  |  
|Commitments and contingencies                                                                                                                                                                            |                                           |                           |             |                  |  
|Shareholders' equity:                                                                                                                                                                                    |                                           |                           |             |                  |  
|Preferred Stock $.0001 par value, 1,000,000 shares authorized, and no shares issued and outstanding                                                                                                      |                                           |                           |             |                  |  
|Common stock $0.0001 par value, 100,000,000 shares authorized, 27,529,010 and 26,250,000 shares issued, respectively, which includes 0 and 4,197,900 shares subject to possible redemption, respectively |                                           |                           | 2,753       |                  |  
|Common stock; Class A voting, no par; 75,000,000 shares authorized; 9,219,700 issued and outstanding                                                                                                     |                                           |                           |            |                  |  
|Common stock; Class B voting, no par; 75,000,000 shares authorized; 10,000,000 issued and outstanding                                                                                                    |                                           |                           |            |                  |  
|Additional paid-in capital                                                                                                                                                                               |                                           |                           | 129,384,746 |                  |  
|Treasury stock, at cost, 8,342,755 and 0 shares, respectively, for successor, and 196,300 shares for predecessor                                                                                         |                                           |                           | (30,272,007 | )                |  
|Retained (deficit) earnings                                                                                                                                                                              |                                           |                           | (3,362,407  | )                |  
|Other comprehensive income (net of $260,907 tax effect)                                                                                                                                                  |                                           |                           | (417,771    | )                |  
|                                                                                                                                                                                                         |                                           |                           |             |                  |  
|Total shareholders' equity                                                                                                                                                                               |                                           |                           | 95,335,314  |                  |  
|                                                                                                                                                                                                         |                                           |                           |             |                  |  
|Total liabilities and shareholders' equity                                                                                                                                                               |                                           | $                         | 170,950,316 |                  | $
|                                                                                                                                                                                                         |                                           |                           |             |                  |  

The accompanying notes are an integral part of these consolidated financial statements.

F-6

---





ATS CORPORATION        CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                                                                                   |                                                                                 | ATS Corporation
Successor |            | ATSI
Predecessor |  
|-------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------- | ------------------------- | ---------- | ---------------- | -
|
|
|
|
|Cash flows from operating activities                                                               |                                                                                 |                           |            |                  |  
|Net (loss) income                                                                                  |                                                                                 | $                         | (6,553,729 | )                | $
|Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: |                                                                                 |                           |            |                  |  
|                                                                                                   | Depreciation and amortization                                                   |                           |            | 679,147          |  
|                                                                                                   | Amortization of intangibles                                                     |                           |            | 4,215,418        |  
|                                                                                                   | Stock-based compensation                                                        |                           |            | 1,034,017        |  
|                                                                                                   | Deferred income taxes                                                           |                           |            | (1,820,581       | )
|                                                                                                   | Deferred rent                                                                   |                           |            | 175,053          |  
|                                                                                                   | Loss on disposal of business                                                    |                           |            |                 |  
|                                                                                                   | Loss on disposal of equipment                                                   |                           |            |                 |  
|                                                                                                   | (Gain) loss on derivative liabilities related to warrants                       |                           |            | 6,930,000        |  
|                                                                                                   | Bad debt                                                                        |                           |            | 37,911           |  
|Changes in assets and liabilities, net of effects of acquisitions:                                 |                                                                                 |                           |            |                  |  
|                                                                                                   | Accounts receivable                                                             |                           |            | 26,912           |  
|                                                                                                   | Accrued interest payable and receivable                                         |                           |            | 232,835          |  
|                                                                                                   | Prepaid expenses and other current assets                                       |                           |            | (286,613         | )
|                                                                                                   | Accounts payable and other accrued expenses                                     |                           |            | (256,652         | )
|                                                                                                   | Accrued salaries and related taxes                                              |                           |            | (5,229,988       | )
|                                                                                                   | Accrued vacation                                                                |                           |            | (303,185         | )
|                                                                                                   | Income taxes payable and receivable                                             |                           |            | (2,195,796       | )
|                                                                                                   | Other current liabilities                                                       |                           |            | (209,224         | )
|                                                                                                   | Other long-term liabilities                                                     |                           |            | (137,826         | )
|                                                                                                   | Restricted cash                                                                 |                           |            | (60,707          | )
|                                                                                                   |                                                                                 |                           |            |                  |  
|Net cash (used in) provided by operating activities                                                |                                                                                 | $                         | (3,723,008 | )                | $
|                                                                                                   |                                                                                 |                           |            |                  |  
|Cash flows from investing activities                                                               |                                                                                 |                           |            |                  |  
|                                                                                                   | Purchase of property and equipment                                              |                           |            | (373,063         | )
|                                                                                                   | Proceeds from sale of businesses                                                |                           |            |                 |  
|                                                                                                   | Acquisition of businessesnet of cash acquired                                  |                           |            | (123,249,859     | )
|                                                                                                   | Sale of U.S. government securities held in trust fund                           |                           |            | 121,024,475      |  
|                                                                                                   | Purchase of U.S. government securities held in trust fund                       |                           |            |                 |  
|                                                                                                   | Maturities of U.S. government securities held in trust fund                     |                           |            |                 |  
|                                                                                                   | Deferred acquisition costs                                                      |                           |            |                 |  
|                                                                                                   | Release (deposit) of cash held in trust fund                                    |                           |            | 1,332            |  
|                                                                                                   |                                                                                 |                           |            |                  |  
|Net cash (used in) provided by investing activities                                                |                                                                                 | $                         | (2,597,115 | )                | $
|                                                                                                   |                                                                                 |                           |            |                  |  
|Cash flows from financing activities                                                               |                                                                                 |                           |            |                  |  
|                                                                                                   | Net borrowings (payments) on lines-of-credit                                    |                           |            | 41,084,125       |  
|                                                                                                   | Payments on notes payable                                                       |                           |            | (645,833         | )
|                                                                                                   | Payments on capital leases                                                      |                           |            | (76,459          | )
|                                                                                                   | Payments to repurchase stock purchase warrants                                  |                           |            | (2,081,121       | )
|                                                                                                   | Payments to repurchase treasury stock                                           |                           |            | (30,272,007      | )
|                                                                                                   | Exercise of stock options                                                       |                           |            |                 |  
|                                                                                                   | Proceeds from public offering, net of expenses                                  |                           |            |                 |  
|                                                                                                   | Proceeds from notes payable to stockholders                                     |                           |            |                 |  
|                                                                                                   | Repayment of notes to stockholders                                              |                           |            |                 |  
|                                                                                                   | Proceeds from sale of common stock to founders                                  |                           |            |                 |  
|                                                                                                   |                                                                                 |                           |            |                  |  
|Net cash provided by (used in) financing activities                                                |                                                                                 | $                         | 8,008,705  |                  | $
|                                                                                                   |                                                                                 |                           |            |                  |  
|Net increase (decrease) in cash                                                                    |                                                                                 | $                         | 1,688,582  |                  | $
|Cash and cash equivalents, beginning of period                                                     |                                                                                 |                           | 213,395    |                  |  
|                                                                                                   |                                                                                 |                           |            |                  |  
|Cash and cash equivalents, end of period                                                           |                                                                                 | $                         | 1,901,977  |                  | $
|                                                                                                   |                                                                                 |                           |            |                  |  
|Supplemental disclosures:                                                                          |                                                                                 |                           |            |                  |  
|Cash paid or received during the period for:                                                       |                                                                                 |                           |            |                  |  
|                                                                                                   | Income taxes paid                                                               |                           | $          | 4,215,380        |  
|                                                                                                   | Income tax refunds                                                              |                           | $          | 4,201            |  
|                                                                                                   | Interest paid                                                                   |                           | $          | 569,244          |  
|                                                                                                   | Interest received                                                               |                           | $          | 233,500          |  
|Non-cash activities:                                                                               |                                                                                 |                           |            |                  |  
|                                                                                                   | Reclassification of common stock subject to possible redemption                 |                           | $          |                 |  
|                                                                                                   | Accretion of trust fund relating to common stock subject to possible redemption |                           | $          |                 |  
|                                                                                                   | Warrant obligation in connection with sale of units in offering                 |                           | $          |                 |  
|                                                                                                   | Issuance of stock related to acquisition of businesses                          |                           | $          | 4,750,000        |  
|                                                                                                   | Notes payable issued related to acquisition of businesses                       |                           | $          | 4,749,998        |  
|                                                                                                   | Unrealized comprehensive loss on interest rate swapnet of tax                  |                           | $          | 417,771          |  

The accompanying notes are an integral part of these consolidated financial statements.

F-7

---





ATS CORPORATION        CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

|                                                                                                                                                         |  | Successor  | 
|-------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------- | 
|
|
|
|BalanceApril 12, 2005                                                                                                                                   |  |            | 
|Initial capital from founding stockholders                                                                                                               |  | 5,250,000  | 
|Sale of 21,000,000 units (including 4,197,000 shares of common stock subject to possible redemption)net of underwriters' discount and offering expenses |  | 21,000,000 | 
|Reclassification of proceeds allocated to warrantsderivatives liabilities                                                                               |  |           | 
|Reclassification as a result of 4,197,900 shares of common stock being subject to possible redemption                                                    |  |           | 
|Accretion of trust fund relating to common stock subject to possible redemption                                                                          |  |           | 
|Net (loss) for the period                                                                                                                                |  |           | 
|                                                                                                                                                         |  |            | 
|BalanceDecember 31, 2005                                                                                                                                |  | 26,250,000 | 
|Accretion of trust fund relating to common stock subject to possible redemption                                                                          |  |           | 
|Net income                                                                                                                                               |  |           | 
|                                                                                                                                                         |  |            | 
|BalanceDecember 31, 2006                                                                                                                                |  | 26,250,000 | 
|                                                                                                                                                         |  |            | 
|Stock-based compensation, employees                                                                                                                      |  |           | 
|Stock-based compensation, directors                                                                                                                      |  |           | 
|Common stock issued to employees and directors                                                                                                           |  | 78,581     | 
|Reclassification of warrants                                                                                                                             |  |           | 
|Repurchases of warrants                                                                                                                                  |  |           | 
|Repurchase of shares from dissenting shareholders                                                                                                        |  |           | 
|Repurchases of common stock                                                                                                                              |  |           | 
|Issuance of common stock related to acquisitions                                                                                                         |  | 1,200,429  | 
|Net loss                                                                                                                                                 |  |           | 
|Change in fair value of interest rate swap                                                                                                               |  |           | 
|Agreement, net of tax                                                                                                                                    |  |           | 
|                                                                                                                                                         |  |            | 
|BalanceDecember 31, 2007                                                                                                                                |  | 27,529,010 | 
|                                                                                                                                                         |  |            | 

|
|

|                         |  | Predecessor | 
|------------------------ |  | ----------- | 
|
|
|
|BalanceOctober 31, 2004 |  | 9,207,700   | 
|                         |  |             | 
|Purchase of common stock |  | 12,000      | 
|Net loss                 |  |            | 
|                         |  |             | 
|BalanceOctober 31, 2005 |  | 9,219,700   | 
|                         |  |             | 
|Purchase of common stock |  |            | 
|Net loss                 |  |            | 
|                         |  |             | 
|BalanceOctober 31, 2006 |  | 9,219,700   | 
|Net loss                 |  |            | 
|                         |  |             | 
|BalanceJanuary 15, 2007 |  | 9,219,700   | 
|                         |  |             | 

The accompanying notes are an integral part of these consolidated financial statements.

F-8

---





ATS CORPORATION        CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

|                                                      |  | Successor |           
|----------------------------------------------------- |  | --------- | ----------
|
|
|
|Net income (loss)                                     |  | $         | (6,553,729
|Change in fair value of interest rate swap agreements |  |           | (417,771  
|                                                      |  |           |           
|Comprehensive income                                  |  | $         | (6,971,500
|                                                      |  |           |           

The
accompanying notes are an integral part of these consolidated financial statements.

F-9

---





ATS CORPORATION        NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1ORGANIZATION AND BASIS OF PRESENTATION

ATS Corporation (formerly Federal Services Acquisition Corporation) (the "Successor Company" or the "Company") was incorporated in Delaware on April 12,
2005. The Company was formed to serve as a vehicle for the acquisition of an operating business in the federal services and defense industries through a merger, capital stock exchange, asset
acquisition, stock purchase or other similar business combination.

On
January 15, 2007, the Company consummated a business combination and acquired all of the outstanding capital stock of Advanced Technology Systems, Inc. (the "Predecessor
Company" or "ATSI") and its subsidiaries (collectively, "ATSI"), a provider of systems integration and application development to the U.S. government, for approximately $80.2 million in cash
and an aggregate of 173,913 shares of common stock of the Company, valued at $1.0 million. The Company funded the cash portion of the ATSI purchase price with the proceeds of its initial public
offering. In connection with the acquisition of ATSI, holders of 2,906,355 shares of common stock voted against the acquisition and perfected their right to redeem their shares of common stock at
$5.77 per share. An aggregate of $16,769,668, from proceeds of our initial public offering, was paid to these dissenting shareholders.

The
Consolidated Financial Statements for the Successor Company include the accounts of ATS Corporation and its wholly owned subsidiaries, RISI, PMG and NSS, since the dates of
acquisition for each company. All intercompany accounts, transactions, and profits among ATS Corporation and its subsidiaries are eliminated in consolidation. The Consolidated Financial Statements for
the Predecessor Company include the accounts of Advanced Technology Systems, Inc. and all its subsidiaries, since the dates of acquisition. All intercompany accounts, transactions, and profits
among Advanced Technology Systems, Inc. and its subsidiaries are eliminated in consolidation.

NOTE 2SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Accounting Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues
and expenses during the reported periods. The actual results could differ from those estimates. Significant management estimates include amounts estimated for costs to complete fixed-price contracts,
estimated award fees for contracts, the amortization period for long-lived intangible assets, recoverability of long-lived assets, reserves for accounts receivable, fair values
of options granted, loss contingencies, and the valuation of income taxes.

Revenue Recognition

The Company recognizes revenue when pervasive evidence of an arrangement exists, services have been rendered or goods delivered, the contract price is fixed or
determinable, and collectibility is reasonably assured. The Company's revenue is derived from primarily three different types of contractual arrangements: time-and-materials'
contracts, fixed-price contracts and cost-plus-fee contracts. Revenue on time-and-material contracts is recognized based on the actual hours performed
at the contracted billable rates for services provided, plus materials cost for products delivered to the customer, and costs incurred on behalf of the customer. Revenue on fixed-price contracts is
recognized ratably over the period of performance or as a percentage-of-completion depending on the facts and circumstances of the contract. Revenue on cost-plus-fee contracts is recognized to the
extent of costs

F-10

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 2SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

incurred,
plus an estimate of the applicable fees earned. Fixed fees under cost-plus-fee contracts are recorded as earned in proportion to the allowable costs incurred in
performance of the contract. For cost-plus-fee contracts that include performance based fee incentives, the Company recognizes the relevant portion of the expected fee to be
awarded by the customer at the time such fee can be reasonably estimated, based on factors such as the Company's prior award experience and communications with the customer regarding performance.

The
Company's fixed price contracts are either service based or require some level of customization. Revenue is recognized ratably over the service period on fixed-price-service
contracts. For fixed-price-completion contracts that involve the design, customization of software products or development of systems that are within the scope of Statement of Position
(SOP) 81-1, Accounting for Performance of Construction-Type and Certain Production-Type Contracts, revenue is recognized on the percentage-of-completion method using
costs incurred in relation to total estimated project costs.

Contract
costs include labor, material, subcontracting costs, and allocated allowable indirect costs. Revenue recognition requires judgment in estimating the revenue and associated
costs, assessing risk in performance, and evaluating technical issues. The Company may estimate award fees and incentive fees or penalties in recognizing revenue based on anticipated awards or when
there is sufficient information to determine.

On
federal government contracts, the Company allocates costs to contracts consistent with the federal procurement regulations. The direct and indirect costs associated with these
contracts are subject to government audit by DCAA or other cognizant audit agencies. Management does not anticipate any material adjustment to the consolidated financial statements in subsequent
periods for audits not yet performed. The incurred cost audits have been completed through October 31, 2004. The Company's
management performs periodic reviews with the program managers to assess contract performance. If an adjustment is necessary to a previous estimate, the change is normally recorded in the current
period earnings.

Contract
revenue recognition inherently involves estimation. Examples of estimates include the contemplated level of effort to accomplish the tasks under the contract, the costs of the
effort, and an ongoing assessment of the Company's progress toward completing the contract. From time to time, as part of its standard management process, facts develop that require the Company to
revise its estimated total costs on revenue. To the extent that a revised estimate affects contract profit or revenue previously recognized, the Company records the cumulative effect of the revision
in the period in which the revisions becomes known. The full amount of an anticipated loss on any type of contract is recognized in the period in which it becomes probable and can reasonably be
estimated.

Under
certain circumstances, the Company may elect to work at risk prior to receiving an executed contract document. The Company has a formal procedure for authorizing any such at risk
work to be incurred. Revenue, however, is deferred until a contract modification or vehicle is provided by the customer.

Operating Cost and Expenses

Direct costs consist of all directly-related contract costs, including compensation costs for personnel, material cost and any other direct costs. Also
appropriate indirect overhead costs are applied to employee direct labor, subcontractor direct labor and material costs and included as direct costs. Selling, general and administrative expenses
include executive, administrative and business

F-11

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 2SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

development
labor costs, indirect expenses related to the performance of these functions, and allocations for fringe benefits costs. Depreciation and amortization include the costs associated with the
systematic write-off of the Company's fixed assets, as well as the amortization of the intangible assets.

Stock Compensation

In December 2004, the FASB issued SFAS No. 123(R),Share Based Payment,which requires that compensation
costs related to share-based payment transactions be recognized in financial statements. Under the fair value recognition provisions of SFAS No. 123(R), the Company recognizes stock-based
compensation based upon the fair value of the stock-based awards taking into account the effects of the employees' expected exercise and post-vesting employment termination behavior.

Deferred Financing Costs

Costs associated with obtaining the Company's financing arrangements are deferred and amortized over the term of the financing arrangements using the effective
interest method.

Income Taxes

Under SFAS No. 109, Accounting for Income Taxes (SFAS No. 109), income taxes are accounted for using the asset and liability method whereby deferred
tax assets and liabilities are recognized for the future tax consequences attributable to differences between the carrying amounts of assets and liabilities, and their respective tax basis, and
operating loss and tax credit carry forwards. The differences between the basis of the assets and liabilities for financial reporting and income tax purposes are recorded as deferred income taxes.
Deferred tax assets and liabilities are measured using tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. When required, a valuation
allowance is established to reduce deferred tax assets to the amount expected to be realized. If there is a change in tax rates the effect on deferred tax assets and liabilities is recognized in
income in the period the change occurred.

In
accordance with the recognition standards established by Financial Accounting Standards Board (FASB) Interpretation No. (FIN) 48Accounting for
Uncertainty in Income Taxesan interpretation of FASB Statement 109, the Company makes a comprehensive review of its portfolio of uncertain tax positions regularly.
In this regard, an uncertain tax position represents the Company's expected treatment of a tax position taken in a filed return, or planned to be taken in a future tax return or claim that has not
been reflected in measuring income tax expense for financial reporting purposes. Until these positions are sustained by the taxing authorities, the Company has not recognized the tax benefits
resulting from such positions and reports the tax effect as a liability for uncertain tax positions in its consolidated statements of financial position.

Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents.

Fair Value of Financial Instruments

The carrying amounts of the Company's financial assets, including cash and cash equivalents and short term investments, accounts receivable, accounts payable and
amounts included in other current

F-12

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 2SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

assets
and current liabilities that meet the definition of a financial instrument approximate fair value because of their short-term nature.

The
fair value of the long-term debt approximates its carrying value at December 31, 2007. The fair value of the Company's interest rate swaps as of
December 31, 2007 was based on current market pricing models (See Note 11).

Derivative Instruments and Hedging Activities

The Company accounts for derivative instruments and hedging activities in accordance with SFAS No. 133,Accounting for Derivative
Instruments and Hedging Activities(SFAS No. 133), as amended. Accordingly, derivatives are recognized as either assets or liabilities in the consolidated balance sheet,
and gains and losses are recognized based on changes in the fair values. Gains and losses on derivatives designated or deemed to be an effective hedge are recognized, net of tax in accumulated other
comprehensive income (loss) in the accompanying consolidated financial statements. As an offset to gains or losses recognized in comprehensive income a gross long-term asset or
long-term liability is recognized, as well as an appropriate long-term deferred tax liability or asset. Gains and losses on derivatives that are not designated or intended to be an
effective hedge are recorded to operations. The classification of gains and losses resulting from the changes in fair values is dependent on the intended use of the derivative and its resulting
designation. The Company uses the change in variable cash flow method to measure the effectiveness of its hedges.

In
order to manage interest rate fluctuation exposure on the bank debt, the Company entered into an interest rate swap agreement with the Bank of America on November 9, 2007
providing the Company an ability to eliminate the variability of interest expense based on fluctuating rates on a $35 million notional amount of debt. The purpose of the derivative instrument
is to hedge cash flows and not for trading purposes. The Company records cash payments and receipts related to its interest rate swap as adjustments to interest expense and as a component of operating
cash flow. As of December 31, 2007, the Company was party to one interest rate swap agreement with Bank of America. (See Note 11).

Accounting for Warrants and Derivative Instruments

On October 25, 2005, the Company consummated its initial public offering of 21,000,000 units. Each unit consists of one share of common stock and two
redeemable common stock purchase warrants. Each warrant entitles the holder to purchase from the Company one share of its common stock at an exercise price of $5.00. The warrants expire
October 19, 2009, or earlier upon redemption. The warrant agreement provides for the Company to register the shares underlying the warrants and was silent as to the penalty to be incurred in
the absence of the Company's ability to deliver registered shares to the warrant holders upon warrant exercise or cash settle the warrants.

Emerging
Issues Task Force 00-19, or EITF 00-19,"Accounting for Derivative Financial Instruments Indexed to and Potentially
Settled in, a Company's Own Stock,"provides criteria for determining whether freestanding contracts that are settled in a company's own stock, including common stock warrants,
should be designated as either an equity instrument, an asset or as a liability under SFAS No. 133. Under the provisions of EITF 00-19, a contract designated as an asset or a
liability must be carried at fair value on a company's balance sheet, with any changes in fair value recorded in a company's results of operations. A contract classified as an equity instrument is
included within equity, and no fair value

F-13

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 2SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

adjustments
are required from period to period. In accordance with EITF 00-19, the warrants to purchase common stock included in the units sold in the Company's initial public
offering were separately accounted for as liabilities.

The
agreement related to the Company's warrants provides for the Company to register and maintain the registration of the shares underlying the warrants and did not specify a penalty in
the absence of the Company's ability to deliver registered shares to holders upon exercise of the warrants. Further, the warrant agreement did not specify that the Company would not be obligated to
net cash settle the instrument. Paragraph 14 of EITF 00-19 states that if the contract allows the company to net-share or physically settle the contract only by
delivering registered shares, it is assumed that the Company will be required to net-cash settle the contract, and as a result liability classification is required. Under
EITF 00-19, registration of the common stock underlying the warrants was not within the Company's control and, as a result, the Company must assume that it could be required to
settle the securities on a net-cash basis, thereby necessitating the treatment of the potential settlement obligation as a liability. The fair value of these securities is presented on the
Company's balance sheets as "warrant liabilities," and the unrealized changes in the values of these derivatives are shown in the Company's statements of operations as "Gain (loss) on warrant
liability" through the date of the clarification agreement discussed below.

Fair
values for traded securities and derivatives are based on quoted market prices. Where market prices are not readily available, as in the case of the Company's warrants as of the
date of issuance, fair values are determined using methods requiring judgment and estimates. Utilizing such methods, the fair value of the warrant liability at October 20, 2005 (the date of
issuance) was determined to be $0.34 per
warrant. At the date of issuance, the Company allocated the unit price between the share of common stock and the warrants issued based upon relative fair value determined, among other things, by
reference to the underlying cash held in the trust fund. The warrants included in the units sold in the Company's initial public offering began to be publicly traded on the Over-the-Counter Bulletin
Board on December 5, 2005, and consequently the fair value of the warrants is reflected as the market price of a warrant at each reporting period.

On
March 14, 2007, the Company entered into a warrant clarification agreement to expressly state that, in the event a warrant would expire unexercised, without value and
unredeemed on the expiration date, under no circumstances would the Company be required to net cash settle the warrants. This agreement modified the classification of the warrants from a liability to
equity. The Company recognized a loss of $6,930,000 representing the change in fair value of the warrant liability from December 31, 2006 through March 14, 2007. The fair value of the
warrants at March 14, 2007 of $20,790,000 was reclassified to additional paid in capital.

Accounts Receivable

Accounts receivable include amounts billed and due from customers, amounts earned but unbilled (primarily related to contracts accounted for under the
percentage-of-completion method of accounting), and amounts retained by customers pending contract completion.

Credit Risk

Management believes that credit risk related to the Company's accounts receivable is limited since the majority of balances outstanding are with agencies of the
U.S. government and the associated creditworthiness of the U.S. government.

F-14

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 2SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Allowance for Doubtful Accounts

An allowance for bad debt against billed accounts receivable is established by the Company based on experience and information available regarding collectability
of receivables. Since the majority of the Company's receivables result from services provided to the U.S. government, the Company believes the credit risk to be relatively low. When the balance of an
accounts receivable is determined to be uncollectible after exercising all means of collection, the receivable balances are written-off.

Property and Equipment

Property and equipment in excess of established thresholds are capitalized and recorded at cost. Furniture and equipment are depreciated using the straight-line
method over the estimated useful life of the asset based on the asset class ranging from three to seven years. Leasehold improvements are amortized over the lease term or useful life of the
improvements, whichever is shorter, using the straight-line method. All repairs and maintenance costs are expensed when incurred.

Goodwill and Other Purchased Intangible Assets

Goodwill represents the excess of costs over fair value of net assets of businesses acquired. Other purchased intangible assets include the fair value of items
such as customer contracts, backlog and customer relationships. SFAS No. 142,Goodwill and Other Intangible Assets(SFAS No. 142),
establishes financial accounting and reporting for acquired goodwill and other intangible assets. Goodwill and indefinite lived intangible assets acquired in a purchase business combination are not
amortized, but rather tested for impairment on an annual basis or triggering event. Purchased intangible assets with a definite useful life are amortized on a straight-line basis over their estimated
useful lives.

The
estimated fair market value of identified intangible assets is amortized over the estimated useful life of the related intangible asset. We have a process pursuant to which we
typically retain third-party valuation experts to assist us in determining the fair market values and useful lives of identified intangible assets. We evaluate these assets for impairment when events
occur that suggest a possible impairment. Such events could include, but are not limited to, the loss of a significant client or contract, decreases in federal government appropriations or funding for
specific programs or contracts, or other similar events. None of these events have occurred for the periods presented. We determine impairment by comparing the net book value of the asset to its
future undiscounted net cash flows. If an impairment occurs, we will record an impairment expense equal to the difference between the net book value of the asset and its estimated discounted cash
flows using a discount rate based on our cost of capital and the related risks of recoverability.

Long-Lived Assets (Excluding Goodwill)

In accordance with the provisions of SFAS No. 144 in accounting for long-lived assets such as property and equipment and intangible assets
subject to amortization, the Company reviews the assets for impairment. If circumstances indicate the carrying value of the asset may not be fully recoverable, a loss is recognized at the time
impairment exists and a permanent reduction in the carrying value of the asset is recorded. The Company believes that the carrying values of its long-lived assets as of December 31,
2007 are fully realizable.

F-15

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ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 2SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Comprehensive Income (Loss)

Comprehensive income (loss) is the change in equity of a business enterprise during a period from transactions and other events and circumstances from
non-owner sources. Other comprehensive income refers to revenue, expenses, and gains and losses that under U.S. generally accepted accounting principles are included in comprehensive
income, but excluded from the determination of net income. The elements within other comprehensive income (loss), net of tax, represent the change in the fair value of interest rate swap. As of
December 31, 2007, the accumulated other comprehensive loss, net of income tax effects, included losses of $417,771 related to the fair value of the interest rate swap.

NOTE 3ACQUISITIONS

Advanced Technology Systems, Inc. ("ATSI")

Effective the close of business of January 15, 2007, the Company acquired all of the outstanding capital stock of ATSI, a provider of systems integration
services and application development to the U.S. government, for $80.2 million in cash, and 173,913 shares valued at approximately $1,000,000 as of the closing date. The Company was organized
to effect a business combination with an operating business in the federal services and defense industries. ATSI is active primarily in the growing U.S. government information technology services
market. ATSI designs, develops and integrates enterprise-wide information technology solutions, including custom software applications that address the U.S. government's need to improve
system efficiency, track human and financial capital, and reduce system downtime. Management believes that ATSI provides a strong federal services platform from which the Company can grow, has strong
core competencies that the Company can build upon, and provides opportunities to create increased stockholder value.

As
of December 31, 2006, the Company had accumulated $1,361,215 in deferred costs related to the proposed acquisition of ATSI. These charges were capitalized in the first quarter
of 2007 when the acquisition was consummated.

In
connection with the acquisition of ATSI, holders of 2,906,355 shares of common stock voted against the acquisition and perfected their right to redeem their shares of common stock at
$5.77 per share. An aggregate of $16,769,668 was paid to such dissenting stockholders.

Under
the purchase method of accounting, the preliminary purchase price was allocated to the net tangible and intangible assets acquired and liabilities assumed, based upon preliminary
estimates, which assume that historical cost approximates fair value of the assets and liabilities of ATSI. As such, management estimates that a substantial portion of the excess purchase price will
be allocated to non-amortizable intangible assets. These estimates were subject to change upon the finalization of the valuation of certain assets and liabilities and may be adjusted in
accordance with the provisions of SFAS No. 141,Business Combinations. Management has concluded that the transaction resulted in
$66.1 million of goodwill that is not expected to be deductible for income tax purposes. Additionally, management concluded that approximately $17.0 million of the purchase price was
allocable to customer-related intangible assets, which include customer contracts, backlog, and non-contractual customer relationships (including trade name recognition). Such intangible
assets will be amortized over periods ranging from three to six years based upon factors such as customer relationships and contract periods.

F-16

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ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 3ACQUISITIONS (Continued)

The
total purchase price paid, including transaction costs of approximately $4.2 million, has been preliminarily allocated as follows:

(in thousands):Cash

$
80,248Common stock (173,913 shares valued on the date of the purchase agreementApril 19, 2006)


1,000Transaction costs


4,200Total purchase price

$
85,448Purchase price allocation:Current assets

$
24,131Property and equipment


1,383Intangible assets


17,000Goodwill


66,123Other assets


2,107Total assets acquired


110,744Current liabilities


17,990Long-term liabilities


741Deferred tax liability from acquisition intangibles


6,565Total liabilities assumed


25,296Net assets acquired

$
85,448


The estimated value and the weighted-average amortization period of each of the components of the customer-related intangible assets are as follows:

Estimated Value
(in millions)

Weighted-Average
Amortization PeriodCustomer contracts

$
10.0

6.0 yearsBacklog


6.0

3.5 yearsNon-contractual customer relationships (including trade name recognition)


1.0

3.0 yearsTotal / Average

$
17.0

4.9 years


The
results of operations for ATSI have been included in the Consolidated Statements of Income from the acquisition date through December 31, 2007.

Management
is assessing the impact of FIN 48 on the purchase of ATSI and will finalize the purchase price allocation when this assessment is completed.

Reliable Integration Services, Inc. ("RISI")

On March 1, 2007, the Company acquired Reliable Integration Services, Inc. ("RISI"), a 37-employee network systems integrator serving
U.S. government defense and civilian agencies, for approximately $1.3 million as set forth below. Management believes that RISI's client base and work

F-17

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 3ACQUISITIONS (Continued)

product
complements ATSI's client base and work product and provides opportunities for both companies to cross sell their services.

Under
the purchase method of accounting, the preliminary purchase price was allocated to the net tangible and intangible assets acquired and liabilities assumed, based upon preliminary
estimates, which assume that historical cost approximates fair value of the assets and liabilities of RISI. Upon completion of the initial purchase price allocation, management concluded that a
substantial portion of the excess purchase price related to non-amortizable intangible assets.

The
results of operations for RISI are included in the consolidated statements of operations from the acquisition date through December 31, 2007.

The
total purchase price paid, including transaction costs of $69,000, has been allocated as follows:

(in thousands):Cash

$
933Common stock (46,296 shares issued)


200Promissory note


86Transaction costs


69Total purchase price

$
1,288Purchase price allocation:Current assets

$
385Property and equipment


16Intangible assets


300Goodwill


1,026Other assets


39Total assets acquired


1,766Current liabilities


362Deferred tax liability from acquisition intangibles


116Total liabilities assumed


478Net assets acquired

$
1,288


Management
has determined that the transaction will result in $1.0 million of goodwill. Approximately $300,000 of the purchase price is expected to be allocated to acquired
customer-related intangible assets, that include customer contracts, backlog, and non-contractual customer relationships (including trade name recognition), and will be amortized over
periods ranging from three to six years based upon factors such as expected customer relationships and contract periods.

F-18

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ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 3ACQUISITIONS (Continued)

The
estimated value and the weighted-average amortization period of each of the components of the customer-related intangible assets are as follows:

Estimated Value
(in thousands)

Weighted-Average
Amortization PeriodCustomer contracts

$
173

6.0 yearsBacklog


102

3.5 yearsNon-contractual customer relationships (including trade name recognition)


25

3.0 yearsTotal / Average

$
300

4.9 years


Management
is assessing the impact of FIN 48 on the purchase of RISI and will finalize the purchase price allocation when this assessment is completed.

Potomac Management Group, Inc. ("PMG")

On September 1, 2007, the Company acquired Potomac Management Group, Inc. ("PMG"), a 149-employee information technology services
provider serving mostly U.S. government agencies, for approximately $16.6 million as set forth below. In addition to this amount, there is the potential for $1.5 million of payments to
the former owners should PMG meet certain performance objectives. Management believes that PMG's client base and work product complements ATSI's client base and work product and provides opportunities
for both companies to cross sell their services.

Under
the purchase method of accounting, the preliminary purchase price was allocated to the net tangible and intangible assets acquired and liabilities assumed, based upon preliminary
estimates, which assume that historical cost approximates fair value of the assets and liabilities of PMG. As such, management estimated that a substantial portion of the excess purchase price will be
allocated to non-amortizable intangible assets.

The
results of operations for PMG are included in the consolidated statements of operations from the acquisition date through December 31, 2007.

F-19

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ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 3ACQUISITIONS (Continued)

The
total purchase price paid, including transaction costs of $130,000, has been preliminarily allocated as follows:

(in thousands):Cash

$
13,750Common stock (134,408 shares issued)


500Promissory note


2,250Transaction costs


130Total purchase price

$
16,630Purchase price allocation:Current assets

$
2,484Property and equipment


208Intangible assets


3,092Goodwill


12,400Other assets


32Total assets acquired


18,216Current liabilities


1,433Non-current liabilities


153Total liabilities assumed


1,586Net assets acquired

$
16,630


Management
has estimated that the transaction will result in $12.4 million of goodwill. Management is currently analyzing the deductibility of goodwill on future income taxes.
Approximately $3.1 million of the purchase price has been allocated to acquired customer-related intangible assets that include customer contracts, backlog, and non-contractual
customer relationships (including trade name recognition), and will be amortized over approximately five years based upon factors such as expected customer relationships and contract periods.

In
addition to the purchase price of $16.6 million for PMG, there is the potential for $1.5 million of payments to the former owners should PMG meet certain defined
performance objectives. Any payments due would occur in October 2008 and October 2009.

The
estimated value and the weighted-average amortization period of each of the components of the customer-related intangible assets are as follows:

Estimated Value
(in thousands)

Weighted-Average
Amortization PeriodCustomer contracts

$
2,844

5.3 yearsNon-contractual customer relationships (including trade name recognition)


248

5.0 yearsTotal / Average

$
3,092

5.3 years


Management
is assessing the impact of FIN 48 on the purchase of PMG and will finalize the purchase price allocation when this assessment is completed.

F-20

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ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 3ACQUISITIONS (Continued)

Number Six Software, Inc. ("NSS")

On November 9, 2007, ATS completed its acquisition of NSS, pursuant to an Agreement and Plan of Merger and Reorganization, dated October 12, 2007,
by and among ATS, NSS, ATS NSS Acquisition, Inc. and certain NSS stockholders (the "Merger Agreement"). The aggregate consideration of approximately $34.5 million includes
$3.0 million in the form of ATS common stock valued at the average price over the 15-day period before the closing of the transaction, and promissory notes and deferred payments
totaling approximately $5.5 million.

Under
the purchase method of accounting, the preliminary purchase price has been allocated to the net tangible and intangible assets acquired and liabilities assumed, based upon
preliminary estimates, which assume that historical cost approximates fair value of the assets and liabilities of NSS. As such, management estimates that a substantial portion of the excess purchase
price will be allocated to non-amortizable intangible assets. These estimates are subject to change upon the finalization of the valuation of certain assets and liabilities and may be
adjusted in accordance with the provisions of SFAS No. 141,Business Combinations. Management has preliminarily estimated that the transaction
will result in $28 million of goodwill that is not expected to be deductible for income tax purposes. Additionally, management estimated that approximately $5.2 million of the purchase
price is allocable to intangible assets. These include customer-related intangibles comprised of customer contracts and non-contractual customer relationships (including trade name
recognition) as well as certain marketing-related and technology-related intangibles. Such intangible assets will be amortized over periods ranging from approximately two to five years based upon
factors such as customer relationships and estimated life of technology.

F-21

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 3ACQUISITIONS (Continued)

The
total purchase price paid, including transaction costs of approximately $0.9 million, has been preliminarily allocated as follows:

(in thousands):Cash

$
25,904Common stock (845,812 shares valued over 15 days ended November 9, 2007)


3,050Promissory notes


5,500Transaction costs


942Total purchase price

$
35,396Less cash acquired


(1,177
)Net acquisition cost


34,219Purchase price allocation:Current assets

$
7,851Property and equipment


200Intangible assets


5,241Goodwill


28,049Other assets


24Total assets acquired


41,365Current liabilities


5,196Long-term liabilities


238Deferred tax liability from acquisition intangibles


1,712Total liabilities assumed


7,146Net assets acquired

$
34,219


The
preliminary estimated value and the weighted-average amortization period of each of the components of the customer-related intangible assets are as follows:

Estimated Value
(in thousands)

Weighted-Average
Amortization PeriodCustomer-related

$
4,406

2.2 yearsMarketing-related


444

2.2 yearsTechnology-related


391

5.0 yearsTotal / Average

$
5,241

2.4 years


The
results of operations for NSS have been included in the Consolidated Statements of Income from the acquisition date through December 31, 2007.

The
purchase of NSS was completed late in fiscal year 2007. Management has not completed its assessment of the allocation of the purchase price.

Pro Forma Information (unaudited)

The unaudited pro forma condensed statement of operations data presented below provides the consolidated revenue, net income and diluted earnings per share of the
Company for the years ended

F-22

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ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 3ACQUISITIONS (Continued)

December 31,
2007 and 2006 as if each of the acquisitions completed during the year had occurred on January 1, 2006. Excluding the tax affected impact of the gain on warrant liabilities
in 2006 of $3.5 million and the loss on warrant liability in 2007 of $4.1 million from net income and net loss would result in an adjusted net loss of $3.5 million and
$2.1 million for 2006 and 2007, respectively. This information does not purport to be indicative of the actual results that would have occurred had the acquisitions taken place at the beginning
of the years as shown.

Year Ended December 31,2007

2006Revenue

$
148,067,865

$
153,314,115Net (loss) income


(6,238,677
)

24,294Diluted earnings per share

$
(0.31
)
$
0.00


NOTE 4RECENT ACCOUNTING PRONOUNCEMENTS

In September 2006, the FASB issued Statement of Financial Accounting Standards ("SFAS") No. 157,Fair Value
Measurements("SFAS No. 157"). SFAS No. 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and
expands disclosures about fair value measurements. Specifically, this Statement sets forth a definition of fair value, and establishes a hierarchy prioritizing the inputs to valuation techniques,
giving the highest priority to quoted prices in active markets for identical assets and liabilities and the lowest priority to unobservable inputs. The provisions of SFAS No. 157 are generally
required to be applied on a prospective basis, except to certain financial instruments accounted for under SFAS No. 133,Accounting for Derivative Instruments and
Hedging Activities, for which the provisions of SFAS No. 157 should be applied retrospectively. In February 2008, the FASB issued Staff Position
FAS 157-2,Effective Date of FASB Statement No. 157, which defers the implementation for the non-recurring
nonfinancial assets and liabilities from fiscal years beginning after November 15, 2007 to fiscal years beginning after November 15, 2008. The statement provisions are effective for the
Company as of January 1, 2008 and are not expected to have a material effect on the Company's financial position or results of operations, and management does not believe the deferred
provisions will have a material effect on the Company's financial position or results of operations when they become effective on January 1, 2009.

In
February 2007, the FASB issued SFAS No. 159,The Fair Value Option for Financial Assets and Financial LiabilitiesIncluding an amendment of
FASB Statement No. 115("SFAS No. 159"). SFAS No. 159 permits an entity, at specified election dates, to choose to measure certain financial instruments
and other items at fair value. The objective of SFAS No. 159 is to provide entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and
liabilities differently, without having to apply complex hedge accounting provisions. SFAS No. 159 is effective for accounting periods beginning after November 15, 2007. The Company is
currently assessing the impact of adopting SFAS No. 159 on its consolidated financial statements.

In
December 2007, the FASB issued SFAS No. 141(R)Business Combinations. SFAS No. 141(R) replaces FASB Statement
No. 141Business Combinations. The new statement retains the fundamental requirements that the acquisition (or purchase) method of
accounting be used for all business combinations and expands the definition of a business, thus increasing the number of transactions which may qualify as business combinations. Contingent
consideration will be measured at fair value at

F-23

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 4RECENT ACCOUNTING PRONOUNCEMENTS (Continued)

the
acquisition date, with changes in fair value recognized in earnings, and transaction-related expenses and restructuring costs will be expensed as incurred. Changes in acquired tax contingencies
will be recognized in earnings if outside the purchase price allocation period (generally one year or less). Adjustments to finalize purchase price allocations will be shown as revised in future
financial statements to reflect the adjustments as if they had been recorded on the acquisition date. Also, in the event of a bargain purchase (acquisition of a business at below fair market value of
net assets acquired) a gain could be recognized, or in the event of a change in control of an existing investment a gain or loss could be recognized. SFAS No. 141(R) will be applied
prospectively to business acquisitions with acquisition dates on or after January 1, 2009. The Company is currently assessing the impact of adopting SFAS No. 141(R) on its consolidated
financial statements.

In
December 2007, the U.S. Securities and Exchange Commission ("SEC") issued Staff Accounting Bulletin No. 110 ("SAB 110"), "Share-Based
Payment." SAB 110 expresses the views of the staff regarding the use of a simplified method, as discussed in SAB 107, in developing an estimate of expected term
of plain vanilla share options in accordance with SFAS No. 123R, "Share-Based Payment." In SAB 107, the staff indicated that it believed
that more detailed external information about employee exercise behavior would, over time, become readily available to companies. Therefore, the staff stated that it would not expect a company to use
the simplified method for share option grants after December 31, 2007. In SAB 110, the staff stated that it understood that such detailed information may not be widely available by
December 31, 2007. Accordingly, the staff will continue to accept, under certain circumstances, the use of the simplified method beyond December 31, 2007. As allowed under
SAB 110, we will continue to use the simplified method in estimating the expected term of our stock options until such time as more relevant detailed information becomes available.

In
December 2007, the FASB issued SFAS No. 160, "Noncontrolling Interests in Consolidated Financial StatementsAn Amendment of ARB
No. 51"("SFAS 160"). SFAS 160 establishes new accounting and reporting standards for the non-controlling interest in a subsidiary and for the
deconsolidation of a subsidiary. SFAS 160 is effective for fiscal years beginning on or after December 15, 2008 and early adoption is prohibited. The Company is currently assessing the
impact of adopting SFAS No. 160 on its consolidated financial statements.

NOTE 5RESTRICTED CASH

The Company is required to maintain $1,200,000 on deposit with a financial institution to support a bonding requirement for one of ATSI's state contracts. Such
amount including interest earned is reflected in restricted cash in the accompanying consolidated balance sheet.

NOTE 6INVESTMENTS HELD IN TRUST

The Company held certain investments in a trust account consisting principally of short-term treasury bills. All such investments held in the trust
fund were disposed as of March 31, 2007.

F-24

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ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 7ACCOUNTS RECEIVABLE

Accounts receivable related to services are as follows:

|                                      |  | Successor |            | Predecessor |  
|------------------------------------- |  | --------- | ---------- | ----------- | -
|
|
|
|Billed receivables                    |  | $         | 23,583,044 |             | $
|Unbilled receivables at end of period |  |           | 7,699,987  |             |  
|                                      |  |           |            |             |  
|Total accounts receivable, current    |  |           | 31,283,031 |             |  
|                                      |  |           |            |             |  
|Total accounts receivable             |  |           | 31,283,031 |             |  
|Allowance for doubtful accounts       |  |           | (91,247    | )           |  
|                                      |  |           |            |             |  
|Accounts receivable, net              |  | $         | 31,191,784 |             | $
|                                      |  |           |            |             |  

Unbilled
receivables include contracts with milestone billings ($4.5 million), contracts billable within 30 days ($2.6 million), contract retentions
($0.4 million), and miscellaneous ($0.2 million). Consistent with industry practice, certain receivables related to long-term contracts are classified as current, although a portion of
these amounts is not expected to be billed and collected within one year. Unbilled receivables at December 31, 2007 are expected to be billed and collected within one year, except for a portion
of the contract retentions held for final billings under cost-plus fee contracts. This amount is less than $0.1 million.

NOTE 8PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

|                                               |  | Successor |           | Predecessor |  
|---------------------------------------------- |  | --------- | --------- | ----------- | -
|
|Equipment and furniture                        |  | $         | 1,228,932 |             | $
|Leasehold improvements                         |  |           | 680,682   |             |  
|Property held under capital leases             |  |           | 270,455   |             |  
|                                               |  |           |           |             |  
|Property and equipment, at cost                |  |           | 2,180,069 |             |  
|Less accumulated depreciation and amortization |  |           | (678,660  | )           |  
|                                               |  |           |           |             |  
|Total property and equipment, net              |  | $         | 1,501,409 |             | $
|                                               |  |           |           |             |  

Amortization
of fixed assets was $678,660 for the year ended December 31, 2007 for ATSC. For the two and a half month period ended January 15, 2007 and the year ended
October 31, 2006, the amortization of fixed assets was $115,061 and $632,000, respectively, for ATSI. Accumulated depreciation for property held under capital leases in 2007 and 2006 was
$86,819 and $152,652, respectively.

F-25

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 9GOODWILL

The Company recognized an increase in goodwill as a result of four acquisitions during 2007. As of December 31, 2007, there was $107.6 million in
goodwill recorded. The remaining amount of goodwill that is deductible for income tax purposes is approximately $15.5 million. The predecessor company had $3.2 million in goodwill at
January 15, 2007 and October 31, 2006.

Goodwill
at December 31, 2007 was related to the following acquistions:

ATSI


66,123,271RISI


1,027,890PMG


12,401,048NSS


28,048,477$
107,600,686


NOTE 10ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses consisted of the following:

|                                                     |  | Successor |           | Predecessor
|---------------------------------------------------- |  | --------- | --------- | -----------
|
|Vendor obligations                                   |  | $         | 5,311,942 |            
|Accrued government fees                              |  |           | 143,346   |            
|Bank overdraft                                       |  |           | 1,791,375 |            
|Accrued expenses                                     |  |           | 965,318   |            
|Contract loss reserves                               |  |           | 243,162   |            
|Other                                                |  |           | 179,522   |            
|                                                     |  |           |           |            
|Total other accrued expenses and current liabilities |  | $         | 8,634,665 |            
|                                                     |  |           |           |            

NOTE 11DEBT

Long term debt consisted of the following:

|                                       |  | Successor |            | Predecessor |  
|-------------------------------------- |  | --------- | ---------- | ----------- | -
|
|Bank credit facilities:                |  |           |            |             |  
|Revolving credit loans                 |  | $         | 1,148,872  |             | $
|Notes payable                          |  |           | 7,341,024  |             |  
|Bank financing                         |  |           | 39,935,253 |             |  
|                                       |  |           |            |             |  
|Total long-term debt                   |  | $         | 48,425,149 |             | $
|Less current portion                   |  |           | (2,820,191 | )           |  
|                                       |  |           |            |             |  
|Long-term debt, net of current portion |  | $         | 45,604,958 |             | $
|                                       |  |           |            |             |  

F-26

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ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 11DEBT (Continued)

At
December 31, 2007, the aggregate maturities of long term debt were as follows:

Year ending December 31,2008

$
2,820,1912009


2,583,3332010


43,021,625Total long-term debt

$
48,425,149


Bank Financing

The Company entered into a $25.0 million revolving credit facility ("Facility") on June 4, 2007 with Bank of America. The Facility had an accordion
feature allowing the Company to increase the commitments under the Facility to $50 million with lender approval. On November 9, 2007, in connection with the acquisition of NSS, the
Facility was increased to $50 million. The Facility also provides for stand-by letters of credit that reduce the funds available under the Facility when issued. As of
December 31, 2007, the Company had no outstanding letters of credit.

The
Facility is a three-year, secured facility that permits continuously renewable borrowings of up to $50.0 million, with an expiration date of June 4, 2010.
The Company pays a fee in the amount of .20% to .25% on the unused portion of the Facility, based on its consolidated leverage ratio, as defined. Any outstanding balances under the Facility are due in
full June 4, 2010.

Borrowings
under the Facility bear interest at rates based on 30 day LIBOR plus applicable margins based on the leverage ratio as determined quarterly. As of December 31,
2007, the effective interest rate, excluding the effect of amortization of debt financing costs, for the outstanding borrowings under the Facility was 7.0%.

The
revolving facility contains financial covenants that stipulate a minimum amount of net worth, a minimum fixed-charge coverage ratio, and a maximum leverage ratio. Substantially all
of the Company's assets serve as collateral under the facility. As of December 31, 2007, the Company was in compliance with the financial covenants.

The
Company capitalized $142,500 of debt issuance costs in 2007 associated with the origination of the Facility and an additional $62,500 of financing costs to amend the Facility in
November 2007. All debt financing costs are being amortized from the date incurred to the expiration date of the Facility. The unamortized balance of $173,065 at December 31, 2007 is included
in other long-term assets.

As
a condition to the increase in the commitments by the bank under the credit facility in conjunction with the NSS acquisition, the Company entered into a forward interest rate swap
agreement in November 2007 under which it exchanged floating-rate interest payments for fixed-rate interest payments. The agreement covers debt totaling $35.0 million
and provides for swap payments through December 1, 2010 with such swaps being settled on a monthly basis. The fixed interest rate provided by the agreement is 4.47%.

The
Company accounts for its interest rate swap agreement under the provisions of SFAS No. 133. The Company has determined that the swap agreement qualifies as an effective hedge.
Accordingly, the fair value of the interest rate swap agreement at December 31, 2007 of $0.7 million has been reported in other long term liabilities with an offset, net of an income tax
effect, included in accumulated other

F-27

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 11DEBT (Continued)

comprehensive
income in the accompanying consolidated balance sheet. The decrease in fair value of $0.4 million, which is net of income tax effects of $0.3 million, is reported as
comprehensive loss in the accompanying consolidated statement of comprehensive income for the year ended December 31, 2007.

Notes Payable

The Company entered into notes with the sellers in connection with the acquisitions of RISI, PMG and NSS as scheduled below.

|Acquisition Related |  | Date of
Note |  | Original
Principal |           | 2007
Principal
Payments |   | 12/31/2007
Current
Portion |  | 12/31/2007
Long Term
Portion |           | 2007
Interest
Payments |   | Interest
Rate | 
|------------------- |  | ------------ |  | ------------------ | --------- | ----------------------- | - | -------------------------- |  | ---------------------------- | --------- | ---------------------- | - | ------------- | 
|RISI                |  | 2/28/2007    |  | $                  | 86,857    |                         | $ |                           |  | $                            | 86,857    |                        | $ |              | 
|PMG                 |  | 8/31/2007    |  |                    | 2,250,000 |                         |   | 187,500                    |  |                              | 750,000   |                        |   | 1,312,500     | 
|NSS                 |  | 11/9/2007    |  |                    | 5,500,000 |                         |   | 458,333                    |  |                              | 1,833,334 |                        |   | 3,208,333     | 
|NSS Note            |  | Assumed      |  |                    | 150,000   |                         |   |                           |  |                              | 150,000   |                        |   |              | 
|                    |  |              |  |                    |           |                         |   |                            |  |                              |           |                        |   |               | 
|Total               |  |              |  | $                  | 7,986,857 |                         | $ | 645,833                    |  | $                            | 2,820,191 |                        | $ | 4,520,833     | 
|                    |  |              |  |                    |           |                         |   |                            |  |                              |           |                        |   |               | 

---

NOTE 12LEASES

The Company leases office space and certain equipment under various operating leases. Rent expense on certain leases containing fixed escalations or other lease
incentives is recognized on a straight line basis over the term of each lease. The leases expire over the next four years. As of December 31, 2007, future minimum lease payments due under these
leases are as follows:

|Year                     |  | Operating
Leases |        | Capital
Leases |   | Facility
Rent |   | Subtotal
Commitments |           | Sublease
Income |   | Net Lease
Payments
|------------------------ |  | ---------------- | ------ | -------------- | - | ------------- | - | -------------------- | --------- | --------------- | - | ------------------
|2008                     |  | $                | 20,894 |                | $ | 110,482       |   | $                    | 2,553,014 |                 | $ | 2,684,390         
|2009                     |  |                  | 18,084 |                |   | 94,441        |   |                      | 814,886   |                 |   | 927,411           
|2010                     |  |                  | 16,586 |                |   | 615           |   |                      | 440,985   |                 |   | 458,186           
|2011                     |  |                  |       |                |   |              |   |                      | 40,594    |                 |   | 40,594            
|2012                     |  |                  |       |                |   |              |   |                      |          |                 |   |                  
|                         |  |                  |        |                |   |               |   |                      |           |                 |   |                   
|Total                    |  | $                | 55,564 |                | $ | 205,538       |   | $                    | 3,849,479 |                 | $ | 4,110,581         
|                         |  |                  |        |                |   |               |   |                      |           |                 |   |                   
|Less Interest            |  |                  |        |                |   | (21,902       | ) |                      |           |                 |   |                   
|                         |  |                  |        |                |   |               |   |                      |           |                 |   |                   
|Net Capital Leases       |  |                  |        |                |   | 183,636       |   |                      |           |                 |   |                   
|Less Current Portion     |  |                  |        |                |   | (96,558       | ) |                      |           |                 |   |                   
|                         |  |                  |        |                |   |               |   |                      |           |                 |   |                   
|Long-term Capital Leases |  |                  |        |                | $ | 87,078        |   |                      |           |                 |   |                   
|                         |  |                  |        |                |   |               |   |                      |           |                 |   |                   

F-28

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 12LEASES (Continued)

The
payments shown are net of sublease income of $646,370, $407,000, $, and $90,193 expected to be received from tenants during 2007, 2008, 2009 and 2010, respectively.

Rent
expense was approximately $3,074,570, for the year ended December 31, 2007, for ATSC. For the two and a half month period ended January 15, 2007 and the year ended
October 31, 2006 rent expense was $622,000 and $2,945,000, respectively, for ATSI.

NOTE 13INCOME (LOSS) PER SHARE

Basic and diluted net income (loss) per share information is presented in accordance with SFAS No. 128,Earnings Per
Share. Basic income (loss) per share is calculated by dividing the net income (loss) attributable to common stockholders by the weighted-average common shares outstanding
during the period. Diluted net income per share is calculated by dividing net income attributable to common stockholders by the weighted average common shares outstanding, which includes common stock
equivalents. Diluted loss per share is calculated by dividing the net income (loss) attributable to common stockholders by only the weighted-average common shares outstanding during the period. Common
stock equivalents are excluded from a calculation of diluted loss per share as the impact
would be anti-dilutive. The Company's common stock equivalents include stock options, restricted stock units, and warrants. For the year ended December 31, 2007, a total of 284,479
common stock equivalents were excluded from the calculation of diluted loss per share for the successor company. For the period ending January 15, 2007 and October 31, 2006, a total of
345,372 common stock equivalents were excluded from the calculation of diluted loss per share for the predecessor company.

F-29

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 13INCOME (LOSS) PER SHARE (Continued)

Weighted
average common shares are calculated as follows:

|                                                                                      |                          | ATS Corporation
(Successor) |            | ATSI
(Predecessor) |  
|------------------------------------------------------------------------------------- | ------------------------ | --------------------------- | ---------- | ------------------ | -
|
|
|
|Income (Loss) from Continuing Operations                                              |                          | $                           | (6,553,729 | )                  | $
|                                                                                      |                          |                             |            |                    |  
|Loss from Discontinued Operations                                                     |                          |                             |           |                    |  
|Net Income (Loss)                                                                     |                          | $                           | (6,553,729 | )                  | $
|Gain on derivative liabilities attributed to warrants                                 |                          |                             |           |                    |  
|Net income (loss) allocable to common stockholders not subject to possible redemption |                          | $                           | (6,553,729 | )                  | $
|                                                                                      |                          |                             |            |                    |  
|Weighted average number of shares outstanding                                         |                          |                             |            |                    |  
|                                                                                      | basic                   |                             |            | 18,848,722         |  
|Shares from assumed conversion of options, warrants and restricted stock              |                          |                             |           |                    |  
|                                                                                      |                          |                             |            |                    |  
|                                                                                      | dilutive                |                             |            | 18,848,722         |  
|                                                                                      |                          |                             |            |                    |  
|Basic net income (loss) per share                                                     |                          |                             |            |                    |  
|                                                                                      | Continuing operations   |                             |            | (0.35              | )
|                                                                                      | Discontinued operations |                             |            |                   |  
|                                                                                      |                          |                             |            |                    |  
|                                                                                      | Net income (loss)       |                             |            | (0.35              | )
|Diluted net income (loss) per share                                                   |                          |                             |            |                    |  
|                                                                                      | Continuing operations   |                             |            | (0.35              | )
|                                                                                      | Discontinued operations |                             |            |                   |  
|                                                                                      |                          |                             |            |                    |  
|                                                                                      | Net income (loss)       |                             |            | (0.35              | )

F-30

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 13INCOME (LOSS) PER SHARE (Continued)

The following table presents pro forma income per share attributable to common stockholders subject to possible conversion and not subject to
possible conversion:

|                                                                                                                                                              |  | Year ended
December 31, 2006 |            | Period ended
December 31, 2005 |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------- | ---------- | ------------------------------ | -
|Net income (loss)                                                                                                                                             |  | $                            | 8,279,400  |                                | $
|Interest income attributable to common stock subject to possible conversion                                                                                   |  |                              | (604,756   | )                              |  
|                                                                                                                                                              |  |                              |            |                                |  
|Pro forma net income (loss) attributable to common stockholders not subject to possible conversion                                                            |  | $                            | 7,674,644  |                                | $
|                                                                                                                                                              |  |                              |            |                                |  
|Pro forma weighted average number of shares outstanding, excluding shares subject to possible conversionbasic                                                |  |                              | 22,052,100 |                                |  
|                                                                                                                                                              |  |                              |            |                                |  
|Pro forma net income (loss) per share, excluding shares subject to possible conversionbasic                                                                  |  | $                            | 0.35       |                                | $
|                                                                                                                                                              |  |                              |            |                                |  
|Net income (loss)                                                                                                                                             |  | $                            | 8,279,400  |                                | $
|Interest income attributable to common stock subject to possible conversion (net of taxes of $561,204 and $64,000, respectively)                              |  |                              | (604,756   | )                              |  
|Gain on derivative liabilities attributed to warrants                                                                                                         |  |                              | (5,880,000 | )                              |  
|                                                                                                                                                              |  |                              |            |                                |  
|Pro forma net income (loss) attributable to common stockholders not subject to possible conversion less gain on derivative liabilities attributed to warrants |  | $                            | 1,794,644  |                                | $
|                                                                                                                                                              |  |                              |            |                                |  
|Pro forma weighted average number of shares outstanding excluding shares subject to possible conversionbasic                                                 |  |                              | 22,052,100 |                                |  
|Shares from assumed conversion on warrants                                                                                                                    |  |                              | 3,887,477  |                                |  
|                                                                                                                                                              |  |                              |            |                                |  
|Pro forma weighted average number of shares outstanding, excluding shares subject to possible conversiondiluted                                              |  |                              | 25,939,577 |                                |  
|                                                                                                                                                              |  |                              |            |                                |  
|Pro forma net income (loss) per share, excluding shares subject to possible conversiondiluted                                                                |  | $                            | 0.07       |                                | $
|                                                                                                                                                              |  |                              |            |                                |  

F-31

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 14STOCK PLANS AND STOCK-BASED COMPENSATION

In December 2004, the FASB issued SFAS No. 123(R),Share Based Payment,which requires that compensation
costs related to share-based payment transactions be recognized in financial statements. Under the fair value recognition provisions of SFAS No. 123(R), the Company recognizes stock-based
compensation based upon the fair value of the stock-based awards taking into account the effects of the employees' expected exercise and post-vesting employment termination behavior. A
summary of the components of stock-based compensation expense recognized during the year ended December 31, 2007 and 2006 for the successor and the period November 1 through
January 15, 2007 and the years ended October 31, 2006 and 2005 for the predecessor is as follows:

|                                       |  |  
|-------------------------------------- |  | -
|
|
|
|
|Non-qualified stock option expense     |  | $
|Restricted Stock                       |  | $
|                                       |  |  
|Total Stock-Based Compensation Expense |  | $
|                                       |  |  

The
fair value of options granted during the year ended December 31, 2007 has been estimated as of the date of grant using the Black-Scholes option pricing model with the
following assumptions:

Year Ended
December 31, 2007Expected dividend yield

0
%Expected volatility

38
%Risk free interest rate

4.4
%Expected life of options

5.8 yearsForfeiture rate

4
%


Effective
November 1, 2006, ATSI was required to adopt the provisions of SFAS No.123(R). However, no options were granted from the adoption date through January 15, 2007.
In connection with the sale of ATSI to ATS Corporation, ATSI was required to redeem 345,372 outstanding stock options for approximately $1.6 million.

On
January 12, 2007, the stockholders of the Company approved the ATS Corporation 2006 Omnibus Incentive Compensation Plan (the "Plan"). Under the Plan, the Company reserved
1.5 million shares of the Company's common stock for issuance to employees and directors through incentive stock options, or non-qualified stock options or through restricted stock
units. During 2007, the Board of Directors authorized the issuance of 809,000 and 665,662 stock options and restricted stock, respectively. During the year, 300,000 options vested but were
subsequently forfeited after termination of employment. In addition, 105,000 options which were not vested, were forfeited in 2007. The stock options have vesting periods of up to four years.

F-32

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 14STOCK PLANS AND STOCK-BASED COMPENSATION (Continued)

A
summary of the activity for the year ended December 31, 2007 is presented below:

|                                         |  | Shares   |   | Weighted
Average
Exercise Price
Per Share |      | Weighted
Average
Remaining
Contractual
Term (Years) |      | Aggregate
Intrinsic
Value
|---------------------------------------- |  | -------- | - | ----------------------------------------- | ---- | --------------------------------------------------- | ---- | -------------------------
|
|Options outstanding, January 1, 2007     |  |         |   | $                                         |     |                                                     |     |                          
|Options granted                          |  | 809,000  |   |                                           | 4.40 |                                                     |     |                          
|Options forfeited                        |  | (405,000 | ) |                                           | 4.89 |                                                     |     |                          
|Options outstanding, December 31, 2007   |  | 404,000  |   | $                                         | 3.92 |                                                     | 9.66 |                          
|                                         |  |          |   |                                           |      |                                                     |      |                          
|Options exercisable at December 31, 2007 |  |         |   | $                                         |     |                                                     |     |                          
|                                         |  |          |   |                                           |      |                                                     |      |                          

The
weighted average grant date fair value of options granted during the year ended December 31, 2007 was $1.90. As of December 31, 2007, there was $470,000 of unrecognized
compensation expense, net of forfeitures related to unvested options. This cost is expected to be recognized over a weighted-average period of 3.6 years. The fair value of options vested during
the twelve month period was approximately $591,000.

Pursuant
to the Plan, during the year ended December 31, 2007, the Company granted 665,662 restricted shares valued at $2.5 million to certain employees and directors. The
stock price range was from $3.40 to $4.34 per share. Such shares vest ratably over a one- to five-year period. During 2007, 40,000 shares vested.

A
summary of the status of the Company's restricted shares as of December 31, 2007, and changes during the year is presented below:

Nonvested Restricted Stock

No. of Shares

Weighted-Average
Grant-Date
Fair ValueNonvested at January 1, 2007



$
Granted

665,662


3.75Vested

(40,000
)

4.22Nonvested at December 31, 2007

625,662

$
3.72


There
was $1.6 million of total unrecognized compensation cost, net of estimated forfeitures, related to restricted shares granted under the Plan as of December 31, 2007.
That cost is expected to be recognized over a weighted-average period of 3.2 years. The total fair value of shares vested during the year ended December 31, 2007 was $168,700.

During
the year, the Company issued 15,500 shares of stock as a bonus to certain employees with an aggregate value of $52,500.

In
addition to employee based stock compensation the directors have the option to be paid their fees in stock or cash. Director fees paid in the form of stock during 2007 amounted to
$85,280.

F-33

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 14STOCK PLANS AND STOCK-BASED COMPENSATION (Continued)

Stock Purchase Plan

On July 24, 2007, the Company adopted an employee stock purchase program with a commencement date of October 1, 2007. The program is officially
called the 2007 Employee Stock Purchase Plan (the "Plan"). The Company has reserved an aggregate of 150,000 shares of Common Stock exclusively for issuance under the Plan. Under the Plan eligible
employees may acquire shares of the Company's common stock at periodic intervals, namely four month offering periods during which payroll deductions are made and shares are subsequently purchased at a
discount. The Plan is subject to shareholder approval at the next annual meeting. As of December 31, 2007, no shares had been purchased under the Plan.

NOTE 15COMMON STOCK

Following the consummation of the acquisition of ATSI, the Company announced and implemented a common stock and warrant repurchase program. In connection with
this program, the Company paid approximately $13.5 million in cash to redeem 2,811,400 shares of common stock at an average price of $4.80 per share and approximately $2,081,000 in cash to
repurchase 5,619,805 warrants.

On
January 16, 2007, the Company announced that it would repurchase 2,625,000 shares of the Company's common stock from the founders at $0.0011 per share. This program was
completed in January 2007.

On
January 16, 2007, the Company announced that it would repurchase shares of those shareholders that voted against the acquisition of ATSI and requested that their shares
(2,906,355) be redeemed at the then per share trust value of $5.77 per share. This program was completed in January 2007.

NOTE 16INCOME TAXES

Effective January 1, 2007, the Company was required to adopt FASB Interpretation No. 48,Accounting for Uncertainty in
Income Taxes("FIN 48"). FIN 48 prescribes a more-likely-than-not threshold of financial statement recognition and measurement
of a tax position taken or expected to be taken in a tax return. This interpretation also provides guidance on de-recognition of income tax assets and liabilities, classification of
current and deferred tax assets and liabilities, accounting for interest and penalties associated with tax positions, accounting for income taxes in interim periods and income tax disclosures. Since
inception and through January 1, 2007, the adoption date of this standard, the Company was in essence a "blank check" company with no substantive operations. Management has concluded that the
adoption of FIN 48 had no material effect on its financial position or results of operations. As of December 31, 2007, the Company does not have any material gross unrecognized tax
benefit liabilities. However, management is still in the process of evaluating the various tax positions associated with the acquisitions of ATSI, RISI, PMG, and NSS and is of the opinion that any
deferred tax liabilities that would ultimately result from uncertain tax positions related to these entities would be covered by indemnification provisions provided in the acquisition agreements or
would result in an adjustment to goodwill.

The
Company files its tax returns as prescribed by the tax laws of the jurisdictions in which it operates. It or one of its subsidiaries files income tax returns in the U.S. federal
jurisdiction and various states. For income tax returns filed by us, the Company is no longer subject to U.S. federal and

F-34

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 16INCOME TAXES (Continued)

state
and local tax examinations by tax authorities for years before 2004, although carry forward tax attributes that were generated prior to 2004 may still be adjusted upon examination by tax
authorities if they either have been or will be utilized. It is the Company's policy to recognize interest and penalties related to income tax matters in income tax expense. For the year ended
December 31, 2007, there were no interest and penalties recorded in income tax expense.

The
components of income tax expense (benefit) are as follows:

|                         |  | Successor |            | Predecessor |  
|------------------------ |  | --------- | ---------- | ----------- | -
|
|
|
|
|
|Current:                 |  |           |            |             |  
|Federal                  |  | $         | 1,875,857  |             | $
|State and local          |  |           | 398,251    |             |  
|Total current            |  |           | 2,274,108  |             |  
|Deferred:                |  |           |            |             |  
|Federal                  |  |           | (1,612,631 | )           |  
|State and local          |  |           | (207,948   | )           |  
|Total deferred           |  |           | (1,820,579 | )           |  
|Total income tax expense |  | $         | 453,529    |             | $

The
income tax expense differs from the amounts computed by applying the statutory U.S. income tax rate of 34% as a result of the following:

|                                                  |  | Successor |  | Predecessor
|------------------------------------------------- |  | --------- |  | -----------
|
|
|
|
|Expected tax expense computed at the federal rate |  | 34.0%     |  | 34.0%      
|(Not includable) nondeductible items              |  | -1.9%     |  | -19.5%     
|Fair value of warrants                            |  | -38.6%    |  |           
|State and local taxes, net of federal             |  | -0.8%     |  | 4.8%       
|Other                                             |  | -0.1%     |  | 0.0%       
|                                                  |  |           |  |            
|Total income tax (expense) benefit                |  | -7.4%     |  | 19.3%      

F-35

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 16INCOME TAXES (Continued)

The
tax effects of temporary differences that give rise to significant deferred tax assets (liability) are presented below:

|                                                     |  | Successor |            | Predecessor |  
|---------------------------------------------------- |  | --------- | ---------- | ----------- | -
|
|
|
|
|Deferred tax assets:                                 |  |           |            |             |  
|Reserves and accruals                                |  | $         | 841,645    |             | $
|Stock-based compensation                             |  |           | 304,921    |             |  
|Deferred rent                                        |  |           |           |             |  
|Capital loss on sale of ATS International            |  |           |           |             |  
|Net operating loss carry forward                     |  |           | 526,130    |             |  
|Start up costs                                       |  |           | 461,209    |             |  
|Other                                                |  |           | 363,735    |             |  
|                                                     |  |           |            |             |  
|Total deferred tax assets                            |  |           | 2,497,640  |             |  
|Valuation allowance                                  |  |           | (141,617   | )           |  
|                                                     |  |           |            |             |  
|Total deferred tax assets net of valuation allowance |  |           | 2,356,023  |             |  
|                                                     |  |           |            |             |  
|Deferred tax liabilities:                            |  |           |            |             |  
|Goodwill and other intangible assets                 |  |           | (7,159,267 | )           |  
|Change in accounting methodcash basis to accrual    |  |           |           |             |  
|Prepaid expenses                                     |  |           | (336,331   | )           |  
|Other                                                |  |           |           |             |  
|                                                     |  |           |            |             |  
|Total deferred tax liabilities                       |  |           | (7,495,598 | )           |  
|                                                     |  |           |            |             |  
|Net deferred tax asset (liability)                   |  | $         | (5,139,575 | )           | $

As
of December 31, 2007, the Company had a valuation allowance of $141,617 related to acquired deferred tax assets related to capital loss carry forwards for which the Company
believes it is more likely than not that the benefit will not be realized prior to their expiration. To the extent the valuation allowance is reversed into income in the future due to the utilization
of the deferred tax assets, the tax benefit will be recorded as a reduction to goodwill.

As
of December 31, 2007 the Company had both federal and state net operating loss carry forwards for tax purposes of approximately $1 million. These net operating loss
carry forwards begin to expire in 2010. As of December 31, 2007, the Company also had capital loss carry forwards for tax purposes of $366,000, which expire in 2010.

F-36

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 17SEGMENT ACCOUNTING

ATSI has reviewed its business operations and determined that the Company operates in a single homogenous business segment. Financial information is reviewed and
evaluated by the chief operating decision maker on a consolidated basis relating to the single business segment. The Company sells similar services that exhibit similar economic characteristics to
similar classes of customers. Revenue is internally reviewed monthly by management on an individual contract basis as a single business segment.

NOTE 18INTANGIBLE ASSETS

Intangible assets represent the customer contracts and backlog resulting from the acquisitions as follows:

|                                     |  | Successor
|------------------------------------ |  | ---------
|
|Customer contracts and relationships |  | $        
|Backlog                              |  |          
|Other                                |  |          
|                                     |  |          
|Intangible assets                    |  |          
|Less accumulated amortization        |  |          
|                                     |  |          
|Total intangible assets, net         |  | $        
|                                     |  |          

F-37

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 18INTANGIBLE ASSETS (Continued)

The
combined weighted average amortization period of all intangible acquisition related assets is scheduled below.

|                                 |                        | Asset Value |            | Life       |  | Annual
Amortization
|-------------------------------- | ---------------------- | ----------- | ---------- | ---------- |  | -------------------
|ATSI                             |                        |             |            |            |  |                    
|                                 | Customer Contracts     |             | $          | 10,000,000 |  | 6.0                
|                                 | Backlog                |             |            | 6,000,000  |  | 3.5                
|                                 | Customer Relationships |             |            | 1,000,000  |  | 3.0                
|                                 |                        |             |            |            |  |                    
|                                 |                        |             | 17,000,000 |            |  |                    
|                                 |                        |             |            |            |  |                    
|RISI                             |                        |             |            |            |  |                    
|                                 | Customer Contracts     |             |            | 173,000    |  | 6.0                
|                                 | Backlog                |             |            | 102,000    |  | 3.5                
|                                 | Customer Relationships |             |            | 25,000     |  | 3.0                
|                                 |                        |             |            |            |  |                    
|                                 |                        |             | 300,000    |            |  |                    
|                                 |                        |             |            |            |  |                    
|PMG                              |                        |             |            |            |  |                    
|                                 | Customer Contracts     |             |            | 2,844,000  |  | 5.3                
|                                 | Customer Relationships |             |            | 248,000    |  | 5.0                
|                                 |                        |             |            |            |  |                    
|                                 |                        |             | 3,092,000  |            |  |                    
|                                 |                        |             |            |            |  |                    
|NSS                              |                        |             |            |            |  |                    
|                                 | Customer Contracts     |             |            | 4,406,000  |  | 2.2                
|                                 | Marketing Related      |             |            | 444,000    |  | 2.2                
|                                 | Technology Related     |             |            | 391,000    |  | 5.0                
|                                 |                        |             |            |            |  |                    
|                                 |                        |             | 5,241,000  |            |  |                    
|                                 |                        |             |            |            |  |                    
|                                 |                        | $           | 25,633,000 |            |  |                    
|                                 |                        |             |            |            |  |                    
|Weighted Average Number of Years |                        |             |            |            |  |                    

The
intangible assets are amortized over periods ranging from 26 to 72 months. Amortization expense for the year ended December 31, 2007 was $4.2 million. Expected
amortization expense for each of the fiscal years through December 31, 2012 and thereafter is as follows:

Fiscal Year Ended

AmountDecember 31, 2008

$
6,685,964December 31, 2009


6,685,964December 31, 2010


3,317,158December 31, 2011


2,356,550December 31, 2012


2,326,984Thereafter


74,248Total intangible assets, net

$
21,446,868


F-38

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ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 19DISCONTINUED OPERATIONS

Advanced Technology Systems International, Inc. ("ATSII")

In August 2005, ATSI management adopted a formal plan for the sale of Advanced Technology Systems International, Inc. ("ATSII"), which had a history of
operating losses. On November 30, 2005, pursuant to the terms of a stock purchase agreement entered into by and between ATSI, ATSII, New Technology Management, Inc. ("NTMI") and NTMI
Acquisition Corporation, ATSI sold all of the outstanding common stock of ATSII.

The
following represents the results of operations of ATSII:

Year Ended October 31, 2006Revenue

$
Loss before taxes


(448,746
)Net loss


(265,990
)


Pyramid

In January 2006, ATSI management decided to discontinue the operations of the Pyramid Products Solutions Group. The following represents the results of the
operations of Pyramid:

Year Ended
October 31, 2006Revenue

$
733,264Loss before taxes


(1,725,455
)Net loss


(1,059,084
)


NOTE 20CUSTOMER INFORMATION

Revenue by customer sector was as follows:

|                          |  | Successor |         | Predecessor
|------------------------- |  | --------- | ------- | -----------
|
|
|Department of Defense     |  | $         | 21,275  |            
|Federal civilian agencies |  |           | 53,633  |            
|Commercial and other      |  |           | 26,531  |            
|State & local government  |  |           | 5,448   |            
|                          |  |           |         |            
|Total                     |  | $         | 106,887 |            
|                          |  |           |         |            

F-39

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ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 21RETIREMENT SAVINGS PLAN

The Company has a qualified 401(k) retirement plan ("401(k) Plan") that was funded by contributions from the Company and substantially all full-time
employees who elect to participate in the plan. The employer contributions are 50% of employee contributions, up to 3% of an employee's gross salary. The employer contributions to the 401(k) Plan for
the years ended December 31, 2007, 2006 and 2005 were $895,995, $0, and $0, respectively. The contributions for the period of November 1 through January 15, 2007 and the years
ended October 31, 2006 and 2005 for the predecessor were $261,680, $536,727, and $1,296,000, respectively.

NOTE 22RELATED PARTY TRANSACTION

The Company agreed to pay CM Equity Management, L.P., a company where certain of the founders previously served in executive capacities, an administrative
fee of $7,500 per month for office space and general and administrative services from October 19, 2005 through the effective date of the acquisition of a target business. For the year ended
December 31, 2006, and the period ended December 31, 2005, respectively, the amount paid or accrued to this entity was $90,000 and $18,145, respectively. There were no payments made for
the year ended December 31, 2007.

NOTE 23COMMON STOCK RESERVED FOR ISSUANCE

At December 31, 2007 and December 31, 2006, there were 0 and 42,000,000, shares of common stock, respectively, reserved for issuance upon exercise
of redeemable warrants.

NOTE 24COMMITMENTS & CONTINGENCIES

Exercise of Warrants

The Company has engaged CRT Capital Group LLC, the underwriter, on a non-exclusive basis, as its agent for the solicitation of the exercise of
the warrants. The Company has agreed to pay CRT Capital Group LLC a commission equal to 2% of the exercise price for each warrant exercised more than one year from October 19, 2005 if
the exercise was solicited by CRT Capital Group LLC. At December 31, 2007 no amount was due to CRT Capital Group LLC.

Employment Agreement

On March 19, 2007, the Company entered into an employment agreement with Dr. Edward H. Bersoff, its Chairman, President and Chief Executive Officer,
who had been serving in that capacity since
January 16, 2007. The employment agreement specifies annual salary and incentive compensation for the terms of the agreement. The agreement also provides for between twelve and eighteen months'
salary and 50% of any incentive compensation targets if the employee is terminated other than for cause.

On
October 29, 2007, the Company and Dr. Bersoff entered into an amendment to Dr. Bersoff's employment agreement, extending his employment term as Chief Executive
Officer through December 31, 2008.

On
May 4, 2007, the Company entered into a letter agreement with its Senior Vice President of Finance who became the Chief Financial Officer on May 22, 2007.

F-40

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 24COMMITMENTS & CONTINGENCIES (Continued)

On
February 3, 2008, the Company entered into an employment agreement with Ms. Pamela A. Little. The agreement provides that Ms. Little will serve in the position of
Chief Financial Officer and Senior Vice President of the Company for an initial term of five years, with subsequent automatic renewals for successive one-year terms, subject to the
termination of either party. The agreement specifies the terms of annual salary and performance-based incentive compensation opportunity. The Agreement includes customary provisions concerning
proprietary information, non-competition, and rights upon termination, including termination by Ms. Little for "good reason," by the Company for "cause," and following a "change in
control," as each of those terms is defined in the Agreement.

In
addition, the Company has entered into employment agreements with certain key employees that provide for severance payments in the event of termination.

Stock Bonuses Related to NSS

The Company entered into restricted stock agreements with three employees of NSS that provided for 90,128 shares of stock valued at $315,448 as of the agreement
date to be issued if the individuals remain employed for a period of one year.

Legal Proceedings

From time to time, we are involved in various legal matters and proceedings concerning matters arising in the ordinary course of business. Other than possibly the
below disclosure, we currently believe that any ultimate liability arising out of these matters and proceedings will not have a material adverse effect on our financial position, results of operations
or cash flows.

F-41

---



ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 24COMMITMENTS & CONTINGENCIES (Continued)

We are a defendant inMaximus, Inc. vs. Advanced Technology Systems, Inc.,pending in the
Connecticut Superior Court, Hartford District. The lawsuit asserts breach of contract and other claims related to a subcontract between Maximus and ATSI associated with a prime contract between
Maximus and the State of Connecticut. The case was filed in August 2007 and remains in a preliminary stage, with our answer and counterclaims to be filed during March 2008. In addition, based on the
claims asserted in the lawsuit, we have made an indemnification demand against the selling shareholders of ATSI under the stock purchase agreement governing the transaction in which the Company (then
Federal Services Acquisition Corporation) acquired ATSI. That demand is subject to the dispute resolution process provided for in the stock purchase agreement.

NOTE 25SUMMARIZED QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

The table below sets forth selected unaudited quarterly condensed financial operating results of the Company for years ended December 31, 2007 and 2006 for
the successor company and the period November 1, 2006 through January 15, 2007 and the year ended October 31, 2006 for the predecessor company.

|                                     |  | Successor |           
|------------------------------------ |  | --------- | ----------
|
|
|Revenue                              |  | $         | 23,477,720
|Operating expenses                   |  |           | 23,361,351
|                                     |  |           |           
|Income from operations               |  | $         | 895,694   
|Other income (expense)               |  |           | 144,186   
|Gain (loss) on warrant liability     |  |           | (6,930,000
|Provision for income taxes           |  |           | (102,711  
|                                     |  |           |           
|Net income (loss)                    |  | $         | (6,772,166
|Basic earnings per share             |  | $         | (0.33     
|                                     |  |           |           
|Diluted earnings per share           |  | $         | (0.33     
|                                     |  |           |           
|Weighted-average shares outstanding: |  |           |           
|Basic                                |  |           | 20,307,248
|Diluted                              |  |           | 20,307,248

F-42

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ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 25SUMMARIZED QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Continued)

|
|

|                                     |  | Successor |            
|------------------------------------ |  | --------- | -----------
|
|
|Operating expenses                   |  | $         | 610,197    
|                                     |  |           |            
|Income from operations               |  |           | (610,197   
|Other income (expense)               |  |           | 1,189,712  
|Gain (loss) on warrant liability     |  |           | (10,920,000
|Provision for income taxes           |  |           | (263,560   
|                                     |  |           |            
|Net income (loss)                    |  |           | (10,604,045
|                                     |  |           |            
|Basic earnings per share             |  | $         | (0.40      
|                                     |  |           |            
|Diluted earnings per share           |  | $         | (0.40      
|                                     |  |           |            
|Weighted-average shares outstanding: |  |           |            
|Basic                                |  |           | 26,250,000 
|Diluted                              |  |           | 26,250,000 

|
|

|                                     |  |   |            | Predecessor |  
|------------------------------------ |  | - | ---------- | ----------- | -
|
|
|
|Revenue                              |  | $ | 21,318,054 |             | $
|Operating expenses                   |  |   | 28,980,283 |             |  
|                                     |  |   |            |             |  
|Income from operations               |  |   | (7,662,229 | )           |  
|Other income (expense)               |  |   | (53,934    | )           |  
|Gain (loss) on warrant liability     |  |   |           |             |  
|Loss from discontinued operations    |  |   |           |             |  
|Provision for income taxes           |  |   | 2,684,217  |             |  
|                                     |  |   |            |             |  
|Net income (loss)                    |  | $ | (5,031,946 | )           | $
|                                     |  |   |            |             |  
|Basic earnings per share             |  |   | 19,022,500 |             |  
|                                     |  |   |            |             |  
|Diluted earnings per share           |  |   | 19,022,500 |             |  
|                                     |  |   |            |             |  
|Weighted-average shares outstanding: |  |   |            |             |  
|Basic                                |  | $ | (0.26      | )           | $
|Diluted                              |  | $ | (0.26      | )           | $

NOTE 26SUBSEQUENT EVENTS

Entry into a Material Definitive Agreement

The Company entered into a Deed of Lease with West*Group Properties, LLC, dated as of February 11, 2008 (the "Lease"). The Lease covers a total of
approximately 58,082 square feet of office space in the Northampton Building located at 7925 Jones Branch Drive, McLean, Virginia and includes the entire third and fourth floors of the building, as
well as two wings on the second floor. The base rent of the property is approximately $133,000 per month, subject to adjustment on each anniversary

F-43

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ATS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 26SUBSEQUENT EVENTS (Continued)

date
of the commencement of the Lease. The Company intends to move its principal executive office to this location from its current location at 7915 Jones Branch Drive. The Lease will commence upon
the completion of certain tenant improvements and the tenant's occupancy of the premises. The term of the Lease is for a ten-year period, with a right to extend the term for two renewal
terms of five years each.

A
copy of the Lease was filed as an exhibit to a current report on Form 8-K filed on February 14, 2007.

F-44

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ATS CORPORATION

Item 15(a) 2.    Supplementary Financial Data

Schedule IIValuation and Qualifying Accounts for fiscal year ended December 31, 2007, and the period from November 1, 2006
through January 15, 2007 and years ended 2006 and 2007.

|Successor                                          |  | Balance at
Beginning
of Period |   | Additions
at Cost |   | Deductions |  | Other
Changes |            | Balance
at End
of Period
|-------------------------------------------------- |  | ------------------------------ | - | ----------------- | - | ---------- |  | ------------- | ---------- | ------------------------
|2007                                               |  |                                |   |                   |   |            |  |               |            |                         
|Reserves deducted from assets to which they apply: |  |                                |   |                   |   |            |  |               |            |                         
|Allowances for doubtful accounts                   |  | $                              |  |                   | $ | 2,076,591  |  | $             | (1,985,344 | )                       
|2006                                               |  |                                |   |                   |   |            |  |               |            |                         
|Reserves deducted from assets to which they apply: |  |                                |   |                   |   |            |  |               |            |                         
|Allowances for doubtful accounts                   |  | $                              |  |                   | $ |           |  | $             |           |                         
|                                                   |  |                                |   |                   |   |            |  |               |            |                         

|
|

|Predecessor                                        |  | Balance at
Beginning
of Period |           | Additions
at Cost |   | Deductions |  | Other
Changes |          | Balance
at End
of Period
|-------------------------------------------------- |  | ------------------------------ | --------- | ----------------- | - | ---------- |  | ------------- | -------- | ------------------------
|Jan 15, 2007                                       |  |                                |           |                   |   |            |  |               |          |                         
|Reserves deducted from assets to which they apply: |  |                                |           |                   |   |            |  |               |          |                         
|Allowances for doubtful accounts                   |  | $                              | 1,198,418 |                   | $ | 227,844    |  | $             | 56,010   |                         
|2006                                               |  |                                |           |                   |   |            |  |               |          |                         
|Reserves deducted from assets to which they apply: |  |                                |           |                   |   |            |  |               |          |                         
|Allowances for doubtful accounts                   |  | $                              | 572,660   |                   | $ | 812,137    |  | $             | (186,378 | )                       

Deferred tax assets are described in Note 16Income Taxes.

F-45

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

|              |  | ATS CORPORATION
|------------- |  | ---------------
|April 4, 2008 |  | By:            

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