##### Table of Contents





UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, D.C.
    20549
  Form 10-K
  (Mark One)þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31, 2007oro

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934   Commission file number:
    000-51002
  ZIPREALTY, INC.
 (Exact name of registrant as
    specified in its charter)
  DELAWARE

94-3319956(State of
    incorporation)

(IRS employer identification
    number)2000 POWELL STREET, SUITE 300

94608EMERYVILLE, CA

(Zip Code)(Address of principal executive
    offices)   (510) 735-2600 (Registrants
    telephone number)
  Securities
    registered pursuant to section 12(b) of the Act:
  Title of Each Class:

Name of Each Exchanged on Which Registered:Shares of Common Stock, $0.001 par value

The NASDAQ Stock Market   Securities
    registered pursuant to section 12(g) of the Act:
    None
  o þ
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. o
  Rule 12b-2
 o þ o o
 (Do
    not check if a smaller reporting Company)
  Rule 12b-2 o þ
      DOCUMENTS
    INCORPORATED BY REFERENCE




---



##### 





TABLE OF
    CONTENTS
   
 PagePART IItem 1.

Business


4Item 1A.

Risk Factors


18Item 1B.

Unresolved Staff Comments


35Item 2.

Properties


35Item 3.

Legal Proceedings


35Item 4.

Submission of Matters to a Vote of Security
    Holders


36PART IIItem 5.

Market for Our Common Stock, Related Stockholder
    Matters and Issuer Purchases of Equity Securities


36Item 6.

Selected Financial Data


39Item 7.

Managements Discussion and Analysis of
    Financial Condition and Results of Operations


40Item 7A.

Quantitative and Qualitative Disclosures About
    Market Risk


61Item 8.

Financial Statements and Supplementary Data


62Item 9.

Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure


89Item 9A.

Controls and Procedures


89Item 9B.

Other Information


89PART IIIItem 10.

Directors, Executive Officers and Corporate
    Governance


90Item 11.

Executive Compensation


90Item 12.

Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters


90Item 13.

Certain Relationships and Related Transactions
    and Director Independence


91Item 14.

Principal Accountant Fees and Services


91PART IVItem 15.

Exhibits and Financial Statement Schedule


92Signatures


93EXHIBIT 10.13EXHIBIT 10.20(A)EXHIBIT 23.1EXHIBIT 31.1EXHIBIT 31.2EXHIBIT 32.1EXHIBIT 32.2   2




---



##### Table of Contents



Statement
    regarding forward-looking statements
    
    trends in the residential real estate market, the market for
    mortgages, and the general economy;
    our future financial results;
    our future growth and expansion into new markets;
    our future advertising and marketing activities; and
    our future investment in technology.  Form 10-K
    Trademarks
  ®
  Internet
    site
  www.ziprealty.com. Form 10-K, Form 10-Q, Form 8-K, Form 10-K.
  Where you
    can find additional information
  Form 10-K, 1-800-SEC-0330. (http://www.sec.gov)
 3




---



##### Table of Contents



PART I  Item 1.
    Business:  OVERVIEW
  ®
    ®
  Form 10-K.
 4




---



##### Table of Contents



INDUSTRY
    BACKGROUND
  The
    U.S. residential real estate market
  Trends Trends Trends
  Trends
    Traditional
    real estate transaction process
        Increasing
    use of the Internet in the residential real estate transaction
    process
  ®
 5




---



##### Table of Contents



Challenges
    and limitations of the traditional residential real estate
    process
    Challenges for home buyers and sellers.
  
    limited access to, and transparency of, information;
    high commissions;
    lack of client control over the process; and
    low levels of agent responsiveness and accountability.  Challenges for agents.
  
    need to spend considerable personal time and money generating
    business;
    limited resources to properly manage client relationships and
    transaction processes; and
    responsibility for other business expenses and access to
    personal benefits, such as health insurance.  Challenges for brokerage firms.
  
    independent contractor nature of agent relationship limits
    accountability and managerial effectiveness;
    ownership and management of client relationships resides with
    the agents, limiting broker relationships with clients; and
    low levels of client and agent loyalty.  OUR
    BUSINESS MODEL
    Addressing
    challenges for home buyers and sellers
  We use the Internet to empower
    consumers.
 6




---



##### Table of Contents



We focus on delivering high-quality service with a
    client-centric approach.
  Our business model is designed to offer a compelling consumer
    value proposition.
  Addressing
    challenges for agents and brokerage firms
  We use proprietary business management technologies and
    processes to increase operational efficiency and provide
    excellent client service.
  Our business model is designed to offer a compelling value
    proposition to agents.
  
    our ZipAgents receive a steady flow of qualified leads without
    individual marketing efforts, allowing them to rapidly develop a
    good pipeline of clients;
    our ZAP technology, with its proprietary CRM tools, allows our
    ZipAgents to remain organized and communicate and sell
    effectively with numerous clients at the same time; and 7




---



##### Table of Contents




    our system includes closing support infrastructure that allows
    our ZipAgents to spend less time on closing tasks and more time
    on new clients than would otherwise be possible without this
    support in place.    OUR
    STRATEGY
    Broaden
    and deepen our presence in existing markets
    Enhance
    the ZipRealty brand
    Continue
    to invest in technology and our people to increase operational
    efficiency
    Expand
    operations into new geographic markets
   8




---



##### Table of Contents



Continue
    to improve the client experience
    OUR
    CONSUMER WEBSITE AND SERVICES
  step-by-step
  Comprehensive
    MLS access for home listings data
    ZipNotify
   9




---



##### Table of Contents



Neighborhood
    data and related information
    Online
    images and virtual tours
    Schedule
    visits
    Home
    offers
    Financing
    pre-approval
  E-LOAN,
  ZIPAGENT
    PLATFORM
     10




---



##### Table of Contents



ZIPAGENTS
    Compensation
    structure
    
    Commissions.  As is customary in the real
    estate brokerage industry, ZipAgents earn a portion of the
    commissions they generate for us, which is known as their split.
    Currently, our commission splits to ZipAgents typically vary
    from as low as 35% to as high as 80% or more of our net
    revenues, after deducting certain other items.
    Expense reimbursement.  All California and
    other eligible ZipAgents (including, where applicable, ZipAgents
    who have met certain levels of productivity) receive expense
    reimbursement. This reimbursement covers many expenses typically
    related to their business, such as automobile usage, cell phone
    usage and Internet connectivity.
    Company-paid marketing expenses.  In the
    traditional independent contractor model, agents are typically
    responsible for covering all of their own marketing expenses,
    including the cost of lead generation, advertising and marketing
    costs associated with selling homes, and production of
    collateral materials. In our model, we cover these costs for all
    of our ZipAgents.
    Benefits.  One of the advantages of our
    employee-based model for our ZipAgents is that we provide them
    with a broad array of benefits that are uncommon in the real
    estate brokerage industry, including company-sponsored health,
    welfare and 401(k) plans, subject to meeting certain tenure
    requirements. In addition, ZipAgents have the ability to earn
    stock options in connection with certain performance levels.  Recruiting
    and training
    CLIENT
    ACQUISITION
  Lead
    generation
   11




---



##### Table of Contents



cost-per-click, cost-per-lead, cost-per-impression,
    PRODUCT
    DEVELOPMENT AND ENGINEERING
        around-the-clock back-up dish-to-dish
 12




---



##### Table of Contents



REGULATORY
    MATTERS
    Government
    regulation
    State regulation.
  Federal regulation.
  Local regulation.
  Federal and state labor regulation.
 13




---



##### Table of Contents



case-by-case
    case-by-case
  Third-party
    regulation
  ® ®
     14




---



##### Table of Contents



brick-and-mortar ®
  ®
  ®
  COMPETITION
  Trends.
    
    quality of the home data available to clients;
    quality of the agents, including ability to attract, retain and
    manage quality agents;
    level of client responsiveness;
    level of commissions charged to sellers or incentives provided
    to buyers;
    clients ability to control the home purchase and home sale
    process;
    local knowledge;
    ease of product usability; and
    overall client service. 15




---



##### Table of Contents



INTELLECTUAL
    PROPERTY
      SEASONALITY
  45-day
  EMPLOYEES
    EXECUTIVE
    OFFICERS
    Name

Age

PositionJoseph Patrick Lashinsky


41


Chief Executive Officer, President and DirectorDavid A. Rector


62


Senior Vice President and Chief Financial OfficerWilliam C. Sinclair


59


Executive Vice President, Operations and Business DevelopmentGenevieve C. Combes


41


Senior Vice President, Planning and OperationsRobert J. Yakominich


51


Senior Vice President, SalesLarry S. Bercovich


49


Vice President, General Counsel and Secretary   Joseph Patrick Lashinsky
 16




---



##### Table of Contents



David A. Rector
  William C. Sinclair
  Genevieve C. Combes cum laude
  Robert J. Yakominich
  Larry S. Bercovich
 17




---



##### Table of Contents



Item 1A.
    Risk
    Factors:  RISK
    FACTORS
    RISKS
    RELATED TO OUR BUSINESS AND INDUSTRY
  We
    have experienced losses in recent quarters and expect to incur
    losses in the future, and our limited operating history makes
    our future financial performance difficult to
    assess.
        Our
    business model requires access to real estate listing services
    provided by third parties that we do not control, and we expect
    that the demand for our services would be reduced if our ability
    to display listings on our website, or to communicate to our
    clients that our website displays MLS listings, is
    restricted.
      ®
 18




---



##### Table of Contents



brick-and-mortar ®
        Our
    business could be harmed by transitions in the real estate
    markets and economic events that are out of our control and may
    be difficult to predict.
   19




---



##### Table of Contents



year-over-year ® year-over-year
  We may
    not be able to continue to grow market share to offset the
    impact of the current contraction in the residential real estate
    market.
    If the
    percentage of our business that is composed of representing home
    sellers, as opposed to home buyers, increases, we may incur
    additional costs and achieve lower profit margins, particularly
    in a softened market.
    The
    recent tightening in the availability of credit, particularly
    with respect to lenders in the mortgage market, has and may
    continue to negatively impact the housing market.
   20




---



##### Table of Contents



Softness
    in the residential real estate market may reduce the
    availability of home loans, which may further negatively impact
    the housing market.
    Foreclosures
    and short sales may cause significant disruption in our
    business.
    Recently
    adopted federal legislation designed to bolster the market for
    nonconforming mortgage loans may result in short or long-term
    fluctuations in the number of residential real estate
    transactions, which could negatively impact our operating
    results.
   21




---



##### Table of Contents



We may
    be unable to integrate our technology with each MLS on a
    cost-effective basis, which may harm our operating results and
    adversely affect our ability to service clients.
    Our
    business model is relatively new and unproven, and we cannot
    guarantee our future success.
    If we
    fail to recruit, hire and retain qualified agents, we would be
    less able to service our clients and our growth would most
    likely be impaired.
      ®
 22




---



##### Table of Contents



We
    would likely incur additional expenses or liabilities if our
    current or former compensation plans, including expense
    allowance or reimbursement policies, are found to violate
    federal or state wage and hour laws.
  Form 10-K
  Our
    failure to effectively manage the growth of our ZipAgents and
    related technology could adversely affect our ability to service
    our clients and harm operating results.
    Our
    failure to effectively manage the growth of our control systems
    could adversely affect our ability to maintain legal
    compliance.
   23




---



##### Table of Contents



If we
    fail to comply with real estate brokerage laws and regulations,
    we may incur significant financial penalties or lose our
    licenses to operate.
  and/or
  We may
    have liabilities in connection with real estate brokerage
    activities.
  standard-of-care
  We may
    have liabilities if any of our employees violates laws
    concerning settlement procedures.
    If any
    of our core services fails to comply with applicable federal and
    state law and regulations, we may incur significant financial
    penalties or lose licenses required to provide these
    services.
   24




---



##### Table of Contents



E-LOAN,
      We may
    have liabilities in connection with our performance of core
    services.
  standard-of-care
  If our
    arrangements for providing core services become impaired, we may
    lose sources of revenue that may be difficult to replace and we
    may be less likely to engage in related transactions with our
    clients.
  and/or E-LOAN, E-LOAN
 25




---



##### Table of Contents



E-LOAN E-LOAN
  If
    consumers do not continue to use the Internet as a tool in their
    residential real estate buying or selling process, we may be
    unable to attract new clients and our growth and financial
    results may suffer.
  face-to-face
  Our
    success depends in part on our ability to expand successfully
    into additional real estate markets.
    
    the economic conditions and demographics of a market;
    the general prices of real estate in a market;
    Internet use in a market;
    competition within a market from local and national brokerage
    firms;
    rules and regulations governing a market;
    the ability and capacity of our organization to manage expansion
    into additional geographic areas, additional headcount and
    increased organizational complexity;
    the existence of, and ease of access to information from, local
    MLSs; and
    state laws governing cash rebates and other regulatory
    restrictions.  start-up
 26




---



##### Table of Contents



Unless
    we develop, maintain and protect a strong brand identity, our
    business may not grow and our financial results would
    suffer.
      We
    have numerous competitors, many of which have valuable industry
    relationships, innovative business models and access to greater
    resources than we do.
  ®
  Trends.
  ®
 27




---



##### Table of Contents



Changes
    in federal and state real estate laws and regulations, and rules
    of industry organizations such as the National Association of
    REALTORS®,
    could adversely affect our business.
    We
    derive a significant portion of our leads through third parties,
    and if any of our significant lead generation relationships are
    terminated, impaired or become more expensive, our ability to
    attract new clients and grow our business may be adversely
    affected.
   28




---



##### Table of Contents



Our
    ability to expand our business may be limited by state laws
    governing cash rebates to home buyers.
  and/or
  We
    have undergone significant management transitions recently and
    need to successfully integrate new members of the management
    team as well as retain key personnel or our business could be
    harmed.
    As we
    implement changes in our agent compensation policies, we may
    incent behaviors that cause an increase in our expenses and
    potentially a decrease in our profit margin with the goal of
    increasing our sales and overall profitability.
    We
    monitor and evaluate the use of our website by our registered
    users, which could raise privacy concerns.
   29




---



##### Table of Contents



The
    value of our services could be diminished if anti-spam software
    filters out an increasing portion of the emails we
    send.
    We may
    be subject to liability for the Internet content that we
    publish.
    We may
    need to change the manner in which we conduct our business if
    government regulation of the Internet increases.
     30




---



##### Table of Contents



Our
    operating results are subject to seasonality and vary
    significantly among quarters during each calendar year, making
    meaningful comparisons of successive quarters
    difficult.
  45-day
    
    timing of widely observed holidays and vacation periods and
    availability of home buyers and sellers, real estate agents and
    related service providers during these periods;
    a desire to relocate prior to the start of the school year;
    inclement weather, which can influence consumers desire or
    ability to visit properties;
    timing of employment compensation changes, such as raises and
    bonuses;
    the time between entry into a purchase contract for real estate
    and closing of the transaction; and
    the levels of housing inventory available for sale.    Our
    reputation and client and agent service offerings may be harmed
    by system failures and computer viruses.
  back-up
 31




---



##### Table of Contents



Our
    business is geographically concentrated, which makes us more
    susceptible to business interruption and financial loss due to
    natural disasters, inclement weather, economic or market
    conditions or other regional events outside of our
    control.
    Our
    intellectual property rights are valuable and our failure to
    protect those rights could adversely affect our
    business.
    We may
    in the future be subject to intellectual property rights
    disputes, which could divert management attention, be costly to
    defend and require us to limit our service
    offerings.
      
    pay damages;
    stop using the technology found to be in violation of a third
    partys rights;
    seek a license for the infringing technology; or
    develop alternative non-infringing technology.   32




---



##### Table of Contents



We
    intend to evaluate acquisitions or investments in complementary
    technologies and businesses and we may not realize the
    anticipated benefits from, and may have to pay substantial costs
    related to, any acquisitions or investments that we
    undertake.
    
    our inability to successfully integrate acquired technologies or
    operations;
    diversion of managements attention;
    problems maintaining uniform standards, procedures, controls and
    policies;
    potentially dilutive issuances of equity securities or the
    incurrence of debt or contingent liabilities;
    expenses related to amortization of intangible assets;
    risks associated with operating a business or in a market in
    which we have little or no prior experience;
    potential write offs of acquired assets;
    loss of key employees of acquired businesses;
    our inability to recover the costs of acquisitions or
    investments; and
    our inability to increase earnings per share.  OTHER
    RISKS RELATED TO OUR STOCK PRICE
  Our
    stock price may be volatile.
    
    variations in our quarterly results of operations;
    changes in our financial guidance for future periods;
    announcements by us or our competitors or lead source providers;
    the relatively low level of public float and average daily
    trading volumes of our common stock;
    changes in estimates of our performance or recommendations, or
    termination of coverage, by securities analysts;
    inability to meet quarterly or yearly estimates or targets of
    our performance;
    the hiring or departure of key personnel, including agents or
    groups of agents or key executives;
    changes in our reputation;
    acquisitions or strategic alliances involving us or our
    competitors;
    changes in the legal and regulatory environment, as well as the
    rules of trade associations, affecting our business; and
    market conditions in our industry and the economy as a whole.   33




---



##### Table of Contents



Our
    share price could decline due to the large number of outstanding
    shares of our common stock eligible for future
    sale.
      The
    relatively small average daily trading volume of our stock could
    result in volatility in our trading prices, particularly if a
    large block of our stock is traded.
    Our
    principal stockholders, executive officers and directors own a
    significant percentage of our stock, and as a result, the
    trading price for our shares may be depressed and these
    stockholders can take actions that may be adverse to your
    interests.
    Our
    charter documents and Delaware law could prevent a takeover that
    stockholders consider favorable and could also reduce the market
    price of our stock.
    
    providing for a classified board of directors with staggered,
    three-year terms;
    not providing for cumulative voting in the election of directors;
    authorizing the board to issue, without stockholder approval,
    preferred stock with rights senior to those of common stock;
    prohibiting stockholder action by written consent;
    limiting the persons who may call special meetings of
    stockholders; and
    requiring advance notification of stockholder nominations and
    proposals. 34




---



##### Table of Contents



Item 1B.
    Unresolved
    Staff Comments:    Item 2.
    Properties:    Item 3.
    Legal
    Proceedings:  Lubocki, et al v.
    ZipRealty
  Crystal Alexander, et al. v. ZipRealty
  ZipRealty Inc., v. Squire,
    Sanders & Dempsey, LLP, Michael W. Kelly Esq., et.
    al.
  Simon et al. v. ZipRealty, Inc.
 35




---



##### Table of Contents



Item 4.
    Submission
    of Matters to a Vote of Security Holders:   PART II  Item 5.
    Market
    for Our Common Stock, Related Stockholder Matters and Issuer
    Purchases of Equity Securities:  Market
    information
    High


Low2006 Calendar yearFirst Quarter

$
10.26


$
8.16Second Quarter

$
9.71


$
7.11Third Quarter

$
8.39


$
5.89Fourth Quarter

$
8.16


$
7.082007 Calendar yearFirst Quarter

$
7.83


$
7.07Second Quarter

$
7.69


$
7.00Third Quarter

$
7.51


$
6.01Fourth Quarter

$
6.63


$
4.59    36




---



##### Table of Contents



Stock
    Performance Graph
    
    the AmEx Interactive Week Internet Index (our Peer Group Index),
    and
    the Total Return Index for The NASDAQ Stock Market
    (U.S. and Foreign).      Comparative
    Returns
  
  TotalNASDAQDate


ZipRealty


Peer Group


ReturnsNovember 10, 2004



100.00




100.00




100.00December 31, 2004



109.63




108.70




106.92December 30, 2005



51.66




110.09




108.39December 29, 2006



45.95




125.80




118.71December 31, 2007



34.36




143.80




130.36  37




---



##### Table of Contents



Dividend
    policy
    Use of
    proceeds
  Form S-1 No. 333-115657)
     38




---



##### Table of Contents



Item 6.
    Selected
    Financial Data:    Year Ended December 31,Statements of Operations Data

2007


2006


2005


2004


2003(In thousands, except per share data)Net transaction revenues

$
101,100


$
92,659


$
91,082


$
60,749


$
32,679Referral and other revenues


2,762



2,728



2,323



1,539



1,128Net revenues


103,862



95,387



93,405



62,288



33,807Operating expenses:Cost of revenues


58,613



52,166



51,122



33,903



19,937Product development


7,320



5,775



3,034



2,257



1,740Sales and marketing


38,256



30,910



24,855



16,896



9,808General and administrative


15,409



13,461



9,204



6,369



4,713Litigation


3,550







4,164







Total operating expenses


123,148



102,312



92,379



59,425



36,198Income (loss) from operations


(19,286
)


(6,925
)


1,026



2,863



(2,391
)Other income (expense):Interest expense


















(2,273
)Interest income


4,401



3,907



2,741



411



60Other income (expense), net


1



(16
)


(14
)


(1
)


21Total other income (expense), net


4,402



3,891



2,727



410



(2,192
)Income (loss) before income taxes


(14,884
)


(3,034
)


3,753



3,273



(4,583
)Provision for (benefit from) income taxes






17,560



(16,714
)


89



Net income (loss)

$
(14,884
)

$
(20,594
)

$
20,467


$
3,184


$
(4,583
)Cumulative preferred stock dividends














552



631Amount allocated to participating preferred shares














2,632



Net income (loss) available to common stockholders

$
(14,884
)

$
(20,594
)

$
20,467


$



$
(5,214
)Net income (loss) per share:Basic

$
(0.66
)

$
(1.00
)

$
1.02


$



$
(3.57
)Diluted

$
(0.66
)

$
(1.00
)

$
0.82


$



$
(3.57
)Weighted average common shares outstanding:Basic


22,586



20,542



20,089



3,798



1,459Diluted


22,586



20,542



25,080



3,798



1,459   Share-Based Payment
   39




---



##### Table of Contents



December 31,Balance Sheet Data

2007


2006


2005


2004


2003(In thousands)Cash, cash equivalents and short-term investments

$
80,467


$
88,808


$
88,909


$
83,497


$
10,357Working capital


72,314



83,794



84,047



80,923



8,183Total assets


90,819



98,357



113,953



88,126



12,430Total long-term liabilities


503



513



38



90



157Total liabilities


13,093



10,488



10,172



5,855



3,535Redeemable convertible preferred stock and warrants


















63,556Total stockholders equity (deficit)

$
77,726


$
87,869


$
103,781


$
82,271


$
(54,660
)   Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations:  The following discussion should be read together with our
    financial statements and related notes appearing elsewhere in
    this report. This discussion contains forward-looking statements
    based upon current expectations that involve numerous risks and
    uncertainties. Our actual results could differ materially from
    those anticipated in these forward-looking statements for many
    reasons, including but not limited to those set forth in
    Risk Factors in Item 1A of Part I of this
    report and elsewhere in this report. Except as otherwise
    required by law, we do not intend to update any information
    contained in these forward-looking statements.
  OVERVIEW
  General
    E-LOAN,
   40




---



##### Table of Contents



Trends
    in our business and financial and real estate
    markets
  Softness in the residential real estate
    market.
  ® ® ® month-over-month,
  year-over-year ® year-over-year
   41




---



##### Table of Contents



Impact of softened residential real estate market on
    availability of mortgages.
    Changes to our business model. and/or
 42




---



##### Table of Contents



Fluctuations in quarterly profitability.
  Industry declines in commission
    percentages. Trends
  Changes in competitive landscape.
 43




---



##### Table of Contents



Industry seasonality and cyclicality. 45-day
    Historical variations in U.S. interest
    rates.
  and/or
 44




---



##### Table of Contents



CRITICAL
    ACCOUNTING POLICIES AND ESTIMATES
      Revenue
    recognition
  E-LOAN
  Internal-use
    software and website development costs
  98-1, Accounting for the Cost of Computer Software Developed or
    Obtained for Internal Use, No. 00-02, Accounting for Website Development Costs.
  Stock-based
    compensation
  Share-Based Payment
 45




---



##### Table of Contents



Accounting for Stock Issued to Employees
  
    compensation cost for all unvested stock-based awards as of
    January 1, 2006 that were granted subsequent to our initial
    filing in May 2004 of the registration statement for our initial
    public offering, and prior to January 1, 2006, based on the
    grant date fair value estimated in accordance with the original
    provisions of SFAS 123;
    compensation cost for stock-based awards granted subsequent, to
    January 1, 2006, based on the grant date fair value
    estimated in accordance with the provisions of
    SFAS 123(R); and
    compensation cost for options granted prior to our initial
    filing in May 2004 of the registration statement for our initial
    public offering, based on the intrinsic value method.    No. 96-18, Accounting for Equity Instruments That Are Issued to Other
    Than Employees for Acquiring, or in Conjunction with Selling,
    Goods or Services (EITF 96-18).
    Income
    taxes
     46




---



##### Table of Contents



47




---



##### Table of Contents



RESULTS
    OF OPERATIONS
    Year Ended December 31,Statements of Operations Data

2007


2006


2005(In thousands, except per share amounts)Net transaction revenues

$
101,100


$
92,659


$
91,082Referral and other revenues


2,762



2,728



2,323Net revenues


103,862



95,387



93,405Operating expenses:Cost of revenues


58,613



52,166



51,122Product development


7,320



5,775



3,034Sales and marketing


38,256



30,910



24,855General and administrative


15,409



13,461



9,204Litigation


3,550







4,164Total operating expenses


123,148



102,312



92,379Income (loss) from operations


(19,286
)


(6,925
)


1,026Other income (expense):Interest income


4,401



3,907



2,741Other income (expense), net


1



(16
)


(14
)Total other income (expense), net


4,402



3,891



2,727Income (loss) before income taxes


(14,884
)


(3,034
)


3,753Provision (benefit) for income taxes






17,560



(16,714
)Net income (loss)

$
(14,884
)

$
(20,594
)

$
20,467Net income (loss) per share:Basic

$
(0.66
)

$
(1.00
)

$
1.02Diluted

$
(0.66
)

$
(1.00
)

$
0.82Weighted average common shares outstanding:Basic


22,586



20,542



20,089Diluted


22,586



20,542



25,080  48




---



##### Table of Contents



Year Ended December 31,Statements of Operations Data

2007


2006


2005Net transaction revenues


97.3
%


97.1
%


97.5
%Referral and other revenues


2.7



2.9



2.5Net revenues


100.0



100.0



100.0Operating expenses:Cost of revenues


56.4



54.7



54.7Product development


7.0



6.0



3.2Sales and marketing


36.8



32.4



26.6General and administrative


14.8



14.1



9.9Litigation


3.4







4.5Total operating expenses


118.4



107.2



98.9Income (loss) from operations


(18.4
)


(7.2
)


1.1Other income (expense):Interest income


4.2



4.1



2.9Other income (expense)










Total other income (expense), net


4.2



4.1



2.9Income (loss) before income taxes


(14.2
)


(3.1
)


4.0Provision (benefit) for income taxes






18.4



(17.9
)Net income (loss)


(14.2
)%


(21.5
)%


21.9
%  49




---



##### Table of Contents



Comparison
    of the years ended December 31, 2007 and December 31,
    2006
  Other
    operating data
  Year EndedDecember 31,


Increase


Percent2007


2006


(Decrease)


ChangeNumber of markets (1)Comparable existing markets


17



17



0New markets


16



6



10Total


33



23



10Number of transactions closed during the period (2)Comparable existing markets


11,813



12,207



(394
)


(3.2
)%New markets


2,149



476



1,673



351.5
%Total


13,962



12,683



1,279



10.1
%Average net revenue per transaction (3)Comparable existing markets

$
7,585


$
7,384


$
201



2.7
%New markets


5,350



5,300



50



0.9
%All markets

$
7,241


$
7,306


$
(65
)


(0.9
)%Number of ZipAgents at end of the periodComparable existing markets


1,627



1,591



36



2.3
%New markets


553



203



350



172.4
%All markets


2,180



1,794



386



21.5
%     (1)
    
    New markets are transferred to existing markets on
    January 1st following the completion of their first full
    calendar year. The Las Vegas, Houston and Miami markets opened
    during 2005 and, therefore, completed their first full calendar
    year at of the end of 2006. Accordingly, these markets were
    moved to existing markets as of January 1, 2007 and are
    included in comparable existing markets for all periods
    presented.  Comparable existing markets:

New markets and the month opened:Atlanta, GA
    Baltimore, MD
    Boston, MD
    Chicago, IL
    Dallas, TX
    Fresno/Central Valley, CA
    Los Angeles, CA
    Houston, TX
    Las Vegas, NV
    Miami, FL
    Orange County, CA
    Phoenix, AZ
    Sacramento, CA
    San Diego, CA
    San Francisco Bay Area, CA
    Seattle, WA
    Washington, DC

Tampa, FL
    Orlando, FL
    Minneapolis, MN
    Austin, TX
    Palm Beach, FL
    Greater Philadelphia Area, PA
    Naples, FL
    Tucson, AZ
    Denver, CO
    Jacksonville, FL
    Salt Lake City, UT
    Richmond, VA
    Virginia Beach, VA
    Charlotte, NC
    Raleigh-Durham, NC
    Westchester County, NY

February 2006
    April 2006
    May 2006
    July 2006
    September 2006
    December 2006
    March 2007
    March 2007
    April 2007
    May 2007
    July 2007
    July 2007
    August 2007
    August 2007
    September 2007
    December 2007   (2)
    
    The term transaction refers to each representation
    of a buyer or seller in a real estate purchase or sale.(3)
    
    Average net revenue per transaction equals net transaction
    revenues divided by number of transactions with respect to each
    period. 50




---



##### Table of Contents



Net
    transaction revenues
    Year EndedDecember 31,


Increase


Percent2007


2006


(Decrease)


Change(In thousands)Net transaction revenuesComparable existing markets

$
89,604


$
90,136


$
(532
)


(0.6
)%New markets


11,496



2,523



8,973



355.7
%Total

$
101,100


$
92,659


$
8,441



9.1
%           Referral
    and other revenues
    Year EndedDecember 31,


Increase


Percent2007


2006


(Decrease)


Change(In thousands)Referral and other revenues

$
2,762


$
2,728


$
34



1.3
%     Cost
    of revenues
    Year EndedDecember 31,


Increase


Percent2007


2006


(Decrease)


Change(In thousands)Cost of revenuesComparable existing markets

$
52,378


$
50,875


$
1,503



3.0
%New markets


6,235



1,291



4,944



382.9
%Total

$
58,613


$
52,166


$
6,447



12.4
%  51




---



##### Table of Contents



Product
    development
    Year EndedDecember 31,


Increase


Percent2007


2006


(Decrease)


Change(In thousands)Product development

$
7,320


$
5,775


$
1,545



26.8
%         Sales and
    marketing
   52




---



##### Table of Contents



Year EndedDecember 31,


Increase


Percent2007


2006


(Decrease)


Change(In thousands)Sales and marketing:Comparable existing markets

$
22,289


$
21,679


$
610



2.8
%New markets


8,591



2,854



5,737



201.1
%Regional/corporate sales support and marketing


7,376



6,377



999



15.6
%Total

$
38,256


$
30,910


$
7,346



23.8
%             General
    and administrative
    Year EndedDecember 31,


Increase


Percent2007


2006


(Decrease)


Change(In thousands)General and administrative

$
15,409


$
13,461


$
1,948



14.5
%    53




---



##### Table of Contents



Litigation
  Year EndedDecember 31,


Increase


Percent2007


2006


(Decrease)


Change(In thousands)Litigation

$
3,550


$



$
3,550



100
%     Interest
    income
    Year EndedDecember 31,


Increase


Percent2007


2006


(Decrease)


Change(In thousands)Interest income

$
4,401


$
3,907


$
494



12.6
%     Other
    income (expense), net
    Year EndedDecember 31,


Increase


Percent2007


2006


(Decrease)


Change(In thousands)Other income (expense), net

$
1


$
(16
)

$
17



105.0
%   Provision
    for income taxes
    Year EndedDecember 31,


Increase


Percent2007


2006


(Decrease)


Change(In thousands)Provision (benefit) for income taxes

$



$
17,560


$
(17,560
)


100.0
%    54




---



##### Table of Contents



Comparison
    of the years ended December 31, 2006 and December 31,
    2005
  Other
    operating data
  Year EndedDecember 31,


Increase


Percent2006


2005


(Decrease)


ChangeNumber of markets (1)Comparable existing markets


14



14



0New markets


9



3



6Total


23



17



6Number of transactions closed during the period (2)Comparable existing markets


11,072



11,957



(885
)


(7.4
)%New markets


1,611



360



1,251



347.5
%Total


12,683



12,317



366



3.0
%Average net revenue per transaction (3)Comparable existing markets

$
7,555


$
7,454


$
101



1.4
%New markets


5,591



5,431



160



2.9
%All markets

$
7,306


$
7,395


$
(89
)


(1.2
)%Number of ZipAgents at end of the periodComparable existing markets


1,428



1,254



172



13.7
%New markets


366



112



254



226.8
%All markets


1,794



1,366



426



31.1
%     (1)
    
    New markets are transferred to existing markets on
    January 1st following the completion of their first full
    calendar year.  Comparable existing markets:

New markets and the month opened:Atlanta, GA
    Baltimore, MD
    Boston, MD
    Chicago, IL
    Dallas, TX
    Fresno/Central Valley, CA
    Los Angeles, CA
    Orange County, CA
    Phoenix, AZ
    Sacramento, CA
    San Diego, CA
    San Francisco Bay Area, CA
    Seattle, WA
    Washington, DC

Las Vegas, NV
    Houston, TX
    Miami, FL
    Tampa, FL
    Orlando, FL
    Minneapolis, MN
    Austin, TX
    Palm Beach, FL
    Greater Philadelphia Area, PA

April 2005
    June 2005
    October 2005
    February 2006
    April 2006
    May 2006
    July 2006
    September 2006
    December 2006   (2)
    
    The term transaction refers to each representation
    of a buyer or seller in a real estate purchase or sale.(3)
    
    Average net revenue per transaction equals net transaction
    revenues divided by number of transactions with respect to each
    period. 55




---



##### Table of Contents



Net
    transaction revenues
    Year EndedDecember 31,


Increase


Percent2006


2005


(Decrease)


Change(In thousands)Net transaction revenuesComparable existing markets

$
83,652


$
89,127


$
(5,475
)


(6.1
)%New markets


9,007



1,955



7,052



360.7
%Total

$
92,659


$
91,082


$
1,577



1.7
%         Referral
    and other revenues
    Year EndedDecember 31,


Increase


Percent2006


2005


(Decrease)


Change(In thousands)Referral and other revenues

$
2,728


$
2,323


$
405



17.4
%     Cost
    of revenues
    Year EndedDecember 31,


Increase


Percent2006


2005


(Decrease)


Change(In thousands)Cost of revenuesComparable existing markets

$
47,519


$
50,028


$
(2,509
)


(5.0
)%New markets


4,647



1,094



3,553



324.6
%Total

$
52,166


$
51,122


$
1,044



2.0
%    56




---



##### Table of Contents



Product
    development
    Year EndedDecember 31,


Increase


Percent2006


2005


(Decrease)


Change(In thousands)Product development

$
5,775


$
3,034


$
2,741



90.4
%     Sales
    and marketing
    Year EndedDecember 31,


Increase


Percent2006


2005


(Decrease)


Change(In thousands)Sales and marketing:Comparable existing markets

$
18,861


$
18,899


$
(38
)


(0.2
)%New markets


5,671



1,677



3,994



238.2
%Regional/corporate sales support and marketing


6,378



4,279



2,099



49.1
%Total

$
30,910


$
24,855


$
6,055



24.4
%    57




---



##### Table of Contents



General
    and administrative
    Year EndedDecember 31,


Increase


Percent2006


2005


(Decrease)


Change(In thousands)General and administrative

$
13,461


$
9,204


$
4,257



46.2
%     Litigation
  Year EndedDecember 31,


Increase


Percent2006


2005


(Decrease)


Change(In thousands)Litigation

$



$
4,164


$
(4,164
)


(100.0
)%    58




---



##### Table of Contents



Interest
    income
    Year EndedDecember 31,


Increase


Percent2006


2005


(Decrease)


Change(In thousands)Interest income

$
3,907


$
2,741


$
1,166



42.6
%     Other
    income (expense), net
    Year EndedDecember 31,


Increase


Percent2006


2005


(Decrease)


Change(In thousands)Other income (expense), net

$
(16
)

$
(14
)

$
(2
)


(18.2
)%   Provision
    for income taxes
  Year EndedDecember 31,


Increase


Percent2006


2005


(Decrease)


Change(In thousands)Provision (benefit) for income taxes

$
17,560


$
(16,714
)

$
34,274



205.1
%     LIQUIDITY
    AND CAPITAL RESOURCES
    Operating
    activities
   59




---



##### Table of Contents



Investing
    activities
        Financing
    activities
      Future
    needs
   60




---



##### Table of Contents



CONTRACTUAL
    OBLIGATIONS AND COMMITMENTS
    Payments Due by PeriodLess Than


1 to 3


3 to 5


More Than1 Year


Years


Years


5 Years


Total(In thousands)Operating lease commitments

$
2,248


$
3,575


$
2,431


$
34


$
8,288   OFF-BALANCE
    SHEET ARRANGEMENTS
    EFFECT OF
    RECENT ACCOUNTING PRONOUNCEMENTS
    Item 7A.
    Quantitative
    and Qualitative Disclosures About Market Risk:  Interest
    rate sensitivity
      Exchange
    rate sensitivity
   61




---



##### Table of Contents



Item 8.
    Financial
    Statements and Supplementary Data:  Financial
    Statements Table of Contents
  PageNumberReport of Independent Registered Public
    Accounting Firm


63Consolidated Balance Sheets


64Consolidated Statements of Operations


65Consolidated Statements of Stockholders
    Equity


66Consolidated Statements of Cash Flows


67Notes to Consolidated Financial Statements


68Financial Statement Schedule 
    Valuation and Qualifying Accounts


92  62




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM     Internal Control 
    Integrated Framework
        
    63




---



##### Table of Contents



ZIPREALTY,
    INC.
  CONSOLIDATED
    BALANCE SHEETS
  December 31,2007


2006(In thousands, except per share amounts)ASSETSCurrent assetsCash and cash equivalents

$
7,818


$
8,575Short-term investments


72,649



80,233Accounts receivable, net of allowance of $29 and $30 at
    December 31, 2007 and 2006, respectively


1,170



1,781Prepaid expenses and other current assets


3,267



3,180Total current assets


84,904



93,769Restricted cash


90



90Property and equipment, net


5,366



4,114Investment in non-consolidated companies






17Intangible assets, net


119



149Other assets


340



218Total assets

$
90,819


$
98,357LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilitiesAccounts payable

$
2,095


$
2,184Accrued expenses and other current liabilities


10,495



7,791Total current liabilities


12,590



9,975Other long-term liabilities


503



513Total liabilities


13,093



10,488Commitments and contingencies (Note 5)Stockholders equityCommon stock: $0.001 par value; 100,000 shares
    authorized; 23,651 and 21,627 shares issued and 23,641 and
    21,627 shares outstanding at December 31, 2007 and 2006,
    respectively


24



22Additional paid-in capital


144,499



134,813Common stock warrants


209



5,519Deferred stock-based compensation


(3
)


(71
)Accumulated other comprehensive income (loss)


188



(157
)Accumulated deficit


(67,141
)


(52,257
)Treasury stock, at cost


(50
)


Total stockholders equity


77,726



87,869Total liabilities and stockholders equity

$
90,819


$
98,357    64




---



##### Table of Contents



ZIPREALTY,
    INC.
  CONSOLIDATED
    STATEMENTS OF OPERATIONS
  Year Ended December 31,2007


2006


2005(In thousands, except per share amounts)Net transaction revenues

$
101,100


$
92,659


$
91,082Referral and other revenues


2,762



2,728



2,323Net revenues


103,862



95,387



93,405Operating expensesCost of revenues


58,613



52,166



51,122Product development


7,320



5,775



3,034Sales and marketing


38,256



30,910



24,855General and administrative


15,409



13,461



9,204Litigation


3,550







4,164Total operating expenses


123,148



102,312



92,379Income (loss) from operations


(19,286
)


(6,925
)


1,026Other income (expense), netInterest income


4,401



3,907



2,741Other income (expense), net


1



(16
)


(14
)Total other income (expense), net


4,402



3,891



2,727Income (loss) before income taxes


(14,884
)


(3,034
)


3,753Provision for (benefit from) income taxes






17,560



(16,714
)Net income (loss)

$
(14,884
)

$
(20,594
)

$
20,467Net income (loss) per share:Basic

$
(0.66
)

$
(1.00
)

$
1.02Diluted

$
(0.66
)

$
(1.00
)

$
0.82Weighted average common shares outstanding:Basic


22,586



20,542



20,089Diluted


22,586



20,542



25,080    65




---



##### Table of Contents





ZIPREALTY,
    INC.
  CONSOLIDATED
    STATEMENTS OF STOCKHOLDERS EQUITY
  Deferred


AccumulatedAdditional


Common


Stock-


Other











Total


ComprehensiveCommon Stock


Paid-In


Stock


Based


Comprehensive


Accumulated


Treasury Stock


Stockholders


IncomeShares


Amount


Capital


Warrants


Compensation


Income (Loss)


Deficit


Shares


Amount


Equity


(Loss)(In thousands)Balance at December 31, 2004


19,880


$
20


$
128,555


$
6,369


$
(438
)

$
(105
)

$
(52,130
)





$



$
82,271Issuance of common stock upon exercise of stock options


239







571



























571Issuance of common stock upon exercise of common stock warrants


154







285



(275
)






















10Amortization of deferred stock-based compensation


















140



















140Reversal of deferred stock-based compensation upon employee
    terminations










(41
)






41



















Tax benefit from employee stock plans










707



























707Comprehensive income:Net income


























20,467











20,467


$
20,467Unrealized loss on
    available-for-sale
    securities, net of tax






















(385
)














(385
)


(385
)Total comprehensive income









































$
20,082Balance at December 31, 2005


20,273



20



130,077



6,094



(257
)


(490
)


(31,663
)










103,781Issuance of common stock upon exercise of stock options


1,151



2



1,562



























1,564Issuance of common stock upon exercise of common stock warrants


203







575



(575
)






















Amortization of deferred stock-based compensation


















100



















100Reversal of deferred stock-based compensation upon employee
    terminations










(86
)






86



















Stock-based compensation expense










2,685



























2,685Comprehensive loss:Net loss


























(20,594
)










(20,594
)

$
(20,594
)Unrealized gain on
    available-for-sale
    securities, net of tax






















333















333



333Total comprehensive loss









































$
(20,261
)Balance at December 31, 2006


21,627



22



134,813



5,519



(71
)


(157
)


(52,257
)










87,869Issuance of common stock upon exercise of stock options


173







203



























203Issuance of restricted common stock


225



































Issuance of common stock upon exercise of common stock warrants


1,626



2



5,758



(5,310
)






















450Amortization of deferred stock-based compensation


















57



















57Reversal of deferred stock-based compensation upon employee
    terminations










(11
)






11



















Stock-based compensation expense










3,520



























3,520Stock-based compensation expense, restricted stock










216



























216Acquisition of treasury stock


(10
)


























10



(50
)


(50
)Comprehensive loss:Net loss


























(14,884
)










(14,884
)

$
(14,884
)Unrealized gain on
    available-for-sale
    securities, net of tax






















345















345



345Total comprehensive loss









































$
(14,539
)Balance at December 31, 2007


23,641


$
24


$
144,499


$
209


$
(3
)

$
188


$
(67,141
)


10


$
(50
)

$
77,726    66




---



##### Table of Contents





ZIPREALTY,
    INC.
  CONSOLIDATED
    STATEMENTS OF CASH FLOWS
  Year Ended December 31,2007


2006


2005(In thousands)Cash flows from operating activitiesNet income (loss)

$
(14,884
)

$
(20,594
)

$
20,467Adjustments to reconcile net income (loss) to net cash provided
    by (used in) operating activitiesDeferred income tax expense (benefit)






17,496



(17,496
)Tax benefit from employee stock plans










707Depreciation and amortization


2,828



2,384



1,518Stock-based compensation expense


3,751



2,785



140Provision for doubtful accounts


(1
)


(12
)


19Amortization of short-term investment premium (discount)


(420
)


(115
)


630Amortization of intangible assets


30



7



Loss on disposal of property and equipment


10



15



Equity in net loss of non-consolidated companies


4



20



Changes in operating assets and liabilitiesAccounts receivable


612



(135
)


(564
)Prepaid expenses and other current assets


(87
)


15



(1,093
)Other assets


(122
)


(133
)


(79
)Accounts payable


(89
)


553



153Accrued expenses and other current liabilities


2,704



(712
)


4,216Other long-term liabilities


(10
)


475



(52
)Net cash provided by (used in) operating activities


(5,674
)


2,049



8,566Cash flows from investing activitiesRestricted cash










100Purchases of short-term investments


(48,830
)


(58,537
)


(37,550
)Proceeds from sale and maturity of short-term investments


57,179



60,793



26,465Purchases of property and equipment


(4,048
)


(3,975
)


(2,820
)Purchase of intangible asset






(150
)


Investment in non-consolidated companies


13



(37
)


Net cash provided by (used in) investing activities


4,314



(1,906
)


(13,805
)Cash flows from financing activitiesProceeds from stock option exercises


203



1,564



571Proceeds from common stock warrant exercises


450







11Acquisition of treasury stock


(50
)






Net cash provided by financing activities


603



1,564



582Net increase (decrease) in cash and cash equivalents


(757
)


1,707



(4,657
)Cash and cash equivalents at beginning of period


8,575



6,868



11,525Cash and cash equivalents at end of period

$
7,818


$
8,575


$
6,868Supplemental cash flow informationNon-cash investing and financing activitiesReversal of deferred stock-based compensation upon employee
    terminations

$
11


$
86


$
41Recognition of additional paid-in capital from common stock
    warrants due to exercise of common stock warrants

$
5,310


$
575


$
275Stock-based compensation capitalized in internal-use software
    costs

$
42


$



$
    67




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES
    TO CONSOLIDATED FINANCIAL STATEMENTS
  1.
    THE
    COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  Nature
    of operations
    Principles
    of consolidation
        Reclassifications
   68




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Year Ended December 31,2006


2005(In thousands)As reportedOperating expenses:Cost of revenues

$
52,166


$
51,122Product development


5,380



2,754Marketing and customer acquisition


12,589



12,306General and administrative


32,177



22,033Litigation






4,164Total operating expenses

$
102,312


$
92,379   Year Ended December 31,2006


2005(In thousands)As reclassifiedOperating expenses:Cost of revenues

$
52,166


$
51,122Product development


5,775



3,034Sales and marketing


30,910



24,855General and administrative


13,461



9,204Litigation






4,164Total operating expenses

$
102,312


$
92,379   Risks
    and uncertainties
    
    regulatory changes;
    the continued use and adoption of the Internet by consumers,
    which allows the Company to compete with established real estate
    firms, many of which have long operating histories and
    substantial client bases; and
    entry into market of companies attempting to replicate the
    Companys business model.  Net
    income (loss) per share
   69




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Use of
    estimates
    Revenue
    recognition
    E-LOAN
  Expense
    recognition
    Cost
    of revenues
    Cash
    and cash equivalents
    Short-term
    investments
  available-for-sale
 70




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Restricted
    cash
    Fair
    value of financial instruments
    Concentration
    of credit risk, significant customers and significant
    suppliers
            Property
    and equipment
    Computer hardware and software

1-3 yearsFurniture, fixtures and equipment

4-5 yearsLeasehold improvements

Shorter of the lease period or estimated useful life    71




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Impairment
    of Long-Lived Assets
  Accounting for the Impairment or Disposal of
    Long-Lived Assets
  Stock-Based
    Compensation
  Share-Based
    Payment Accounting
    for Stock Issued to Employees
  
    compensation cost for all unvested stock-based awards as of
    January 1, 2006 that were granted subsequent to our initial
    filing in May 2004 of the registration statement for our initial
    public offering, and prior to January 1, 2006, based on the
    grant date fair value estimated in accordance with the original
    provisions of SFAS 123;
    compensation cost for stock-based awards granted subsequent, to
    January 1, 2006, based on the grant date fair value
    estimated in accordance with the provisions of
    SFAS 123(R); and
    compensation cost for options granted prior to our initial
    filing in May 2004 of the registration statement for our initial
    public offering, based on the intrinsic value method.   72




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    No. 96-18, Accounting for Equity Instruments That Are Issued to Other
    Than Employees for Acquiring, or in Conjunction with Selling,
    Goods or Services (EITF 96-18).
    Software
    and Website Development Costs
  No. 00-02, Accounting for Website Development Costs No. 00-02). No. 00-02 98-1, Accounting for the Cost of Computer Software Developed or
    Obtained for Internal Use (SOP 98-1) , SOP 98-1,
    Advertising
    Costs
    Income
    Taxes
   73




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Comprehensive
    Income (Loss)
  available-for-sale
  Segment
    Reporting
  Disclosures about Segments of an Enterprise and Related
    Information
  Recent
    Accounting Pronouncements
  Fair Value
    Measurements
  Fair Value Option for Financial Assets and Financial
    Liabilities
  Business Combinations
  Noncontrolling Interests in Consolidated Financial
    Statements, an amendment of ARB No. 51
 74




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2.
    BALANCE
    SHEET COMPONENTS  Short-term
    investments
  available-for-sale
  December 31, 2007


December 31, 2006Gross


Gross


Gross


Estimated


Gross


Gross


Gross


EstimatedAmortized


Unrealized


Unrealized


Fair


Amortized


Unrealized


Unrealized


FairCost


Gains


Losses


Value


Cost


Gains


Losses


Value(In thousands)


(In thousands)Money market securities

$
4,554


$



$



$
4,554


$
5,604


$



$



$
5,604Repurchase agreements


















150











150Asset backed


26,544



80



(38
)


26,586



24,314



13



(41
)


24,286Mortgage backed


10,817



90







10,907Corporate obligations


22,345



37



(29
)


22,353



35,575



14



(77
)


34,512US Government and agency obligations


12,755



48







12,803



21,501



3



(69
)


21,435Total short-term investments

$
77,015


$
255


$
(67
)

$
77,203


$
86,144


$
30


$
(187
)

$
85,987   December 31,


December 31,2007


2006(In thousands)


(In thousands)Recorded as:Cash equivalents

$
4,554


$
5,754Short-term investments


72,649



80,233$
77,203


$
85,987       December 31,2007(In thousands)Due within one year or less

$
34,482Due after one year through two years


16,811Due after two years through four years


25,910$
77,203  75




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Prepaid
    expenses and other current assets
    December 31,2007


2006(In thousands)Prepaid expenses

$
2,283


$
1,935Interest receivable


638



809Other assets


346



436Prepaid expenses and other current assets

$
3,267


$
3,180   Property
    and equipment, net
    December 31,2007


2006(In thousands)Computer hardware and software

$
8,583


$
6,085Furniture, fixtures and equipment


2,174



1,587Leasehold improvements


1,565



1,46412,322



9,136Less: accumulated depreciation and amortization


(6,956
)


(5,022
)Property and equipment, net

$
5,366


$
4,114       Accrued
    expenses and other currents liabilities
    December 31,2007


2006(In thousands)Accrued vacation

$
1,067


$
909Accrued agent commissions


1,980



1,926Accrued bonuses


932



1,523Accrued marketing expenses


949



876Litigation settlement


3,550



Other accrued expenses


2,017



2,557Accrued expenses

$
10,495


$
7,791  76




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Accumulated
    other comprehensive income (loss)
    December 31,2007


2006(In thousands)Other comprehensive income (loss):Unrealized gain (loss) on
    available-for-sale
    securities, net of tax

$
188


$
(157
)Other comprehensive income (loss)

$
188


$
(157
)   3.
    NET
    INCOME (LOSS) PER SHARE    Year Ended December 31,2007


2006


2005(In thousands, except per share amounts)Numerator:Net income (loss)

$
(14,884
)

$
(20,594
)

$
20,467Denominator:Shares used to compute EPS:Basic


22,586



20,542



20,089Add: Dilutive common stock options and warrants










4,991Diluted


22,586



20,542



25,080Net income (loss) per share:Basic

$
(0.66
)

$
(1.00
)

$
1.02Diluted

$
(0.66
)

$
(1.00
)

$
0.82     Year Ended December 31,2007


2006


2005(In thousands)Stock options to purchase common stock


4,432



4,500



808Warrants to purchase common stock


2,312



4,169



3Nonvested common stock


65







6,809



8,669



811  77




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  4.
    INCOME
    TAXES    December 31,2007


2006


2005(In thousands)Current:Federal

$



$
64


$
636State










146



64



782Deferred:Federal






15,853



(15,853
)State






1,643



(1,643
)



17,496



(17,496
)Total provision for income taxes

$



$
17,560


$
(16,714
)     December 31,2007


2006(In thousands)Deferred tax assetsNet operating loss carryforwards

$
18,065


$
16,339Allowances and accruals


4,502



1,846Credits


194



194Total gross deferred tax assets


22,761



18,379Less: valuation allowance


(22,761
)


(18,379
)Net deferred tax assets

$



$
        78




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Year Ended December 31,2007


2006


2005Statutory federal tax rate


34.00
%


34.00
%


34.00
%State tax rate, net of federal benefit


0.00
%


0.00
%


5.27
%Change in valuation allowance


(26.80
)%


576.63
%


(479.15
)%Other, net


(7.20
)%


(31.91
)%


(0.24
)%Total provision for (benefit from) income taxes


0.00
%


578.72
%


(440.12
)%     December 31,2007


2006(In thousands)Prepaid income taxes

$
25


$
29Deferred income taxes, current






$
25


$
29   5.
    COMMITMENTS
    AND CONTINGENCIES  Leases
   79




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    OperatingLeases(In thousands)Year ending December 31,2008

$
2,2482009


1,8362010


1,7392011


1,7402012


691Thereafter


34Total minimum lease payments

$
8,288     Legal
    Proceedings
  Lubocki, et al v.
    ZipRealty
  Crystal Alexander, et al. v. ZipRealty
  ZipRealty Inc., v. Squire,
    Sanders & Dempsey, LLP, Michael W. Kelly Esq., et.
    al.
  Simon et al. v. ZipRealty, Inc.
 80




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Sullivan,
    et al v. ZipRealty
    Indemnifications
      6.
    PREFERRED
    AND COMMON STOCK     81




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  7.
    STOCK-BASED
    COMPENSATION  Stock
    Option Plans
        Form S-8.
    Other
    Stock Options
   82




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Adoption
    of SFAS 123(R)
  Share-Based
    Payment
  No. 96-18, Accounting for Equity Instruments That Are Issued to Other
    Than Employees for Acquiring, or in Conjunction with Selling,
    Goods or Services (EITF 96-18).
  Prior
    to the adoption of SFAS 123(R)
  Accounting for Stock Issued to Employees Accounting for Certain
    Transactions Involving Stock Compensation  an
    Interpretation of APB No. 25 Accounting for
    Stock-Based Compensation Accounting for Stock-Based
    Compensation  Transaction and Disclosure
 83




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Year EndedDecember 31,2005(In thousand)Net income as reported

$
20,467Deduct: Total stock-based employee compensation expense
    determined under the fair value based method for all awards, net
    of tax


(1,127
)Pro forma net income

$
19,340Net income per share, as reported:Basic

$
1.02Diluted

$
0.82Pro forma net income per share:Basic

$
0.96Diluted

$
0.77     Impact
    of the Adoption of SFAS 123(R)
    
    compensation cost for all unvested stock-based awards as of
    January 1, 2006 that were granted subsequent to the
    Companys initial filing in May 2004 of the registration
    statement for its initial public offering, and prior to
    January 1, 2006, that vested during the period based on the
    grant date fair value estimated in accordance with the original
    provisions of SFAS 123;
    compensation cost for stock-based awards granted subsequent to
    January 1, 2006, that vested during the period based on the
    grant date fair value estimated in accordance with the
    provisions of SFAS 123(R); and
    compensation cost for options granted prior to the
    Companys initial filing in May 2004 of the registration
    statement for its initial public offering, that vested during
    the period based on the intrinsic value method. 84




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Year Ended December 31,2007


2006(In thousands)Cost of revenues

$
565


$
500Product development


157



183Sales and marketing


731



514General and administrative


2,298



1,588Total stock-based compensation expense


3,751



2,785Tax effect on stock-based compensation expense






(1,114
)Net effect on net income

$
3,751


$
1,671Effect on earnings per share:Basic

$
0.17


$
0.08Diluted

$
0.17


$
0.08     Valuation
    Assumptions
     85




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Year Ended December 31,2007


2006


2005Expected volatility


45-51
%


51-52
%


33-61
%Risk-free interest rate


3.5-4.8
%


4.3-5.0
%


3.8-4.4
%Expected life (years)


5.5-6.1



5.5-6.1



4.0Expected dividend yield


0
%


0
%


0
%Weighted-average fair value of options granted during the period

$
3.74


$
3.90


$
5.06   Stock
    Option Activity
    WeightedWeighted


AverageAverage


RemainingNumber of


Exercise


Contractual


AggregateShares


Price


Life (Years)


Intrinsic Value(In thousands)








(In thousands)Outstanding at December 31, 2004


3,421


$
5.59



8.15


$
41,983Options granted


704



13.60Options exercised


(240
)


2.38Options forfeited/cancelled/expired


(233
)


10.95Outstanding at December 31, 2005


3,652



7.01



7.56



13,011Options granted


2,664



7.16Options exercised


(1,151
)


1.36Options forfeited/cancelled/expired


(930
)


11.25Outstanding at December 31, 2006


4,235



7.71



8.50



5,885Options granted


2,052



7.12Options exercised


(173
)


1.18Options forfeited/cancelled/expired


(1,796
)


7.79Outstanding at December 31, 2007


4,318



7.66



8.19



1,901Vested and expected to vest at December 31, 2007


3,841



7.69



7.53



1,882Exercisable at December 31, 2007


1,763


$
7.67



6.93


$
1,813   in-the-money in-the-money
     86




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      WeightedAverage Grant DateNumber of


Fair ValueShares


Per Share(In thousands)Nonvested at December 31, 2006


Shares granted


225


$
6.68Shares vested


(28
)Nonvested at December 31, 2007


197


$
6.68   8.
    EMPLOYEE
    BENEFIT PLAN    9.
    UNAUDITED
    QUARTERLY FINANCIAL DATA    Fourth


Third


Second


FirstYear Ended December 31, 2007

Quarter


Quarter


Quarter


Quarter(In thousands)Net transaction revenues

$
20,694


$
27,225


$
30,506


$
22,675Cost of revenues


12,589



15,637



17,312



13,075Income (loss) from operations


(6,987
)


(5,980
)


(2,130
)


(4,189
)Net income (loss)


(5,916
)


(4,831
)


(1,032
)


(3,105
)Net income (loss) per share:Basic

$
(0.26
)

$
(0.21
)

$
(0.05
)

$
(0.14
)Diluted

$
(0.26
)

$
(0.21
)

$
(0.05
)

$
(0.14
)Weighted average common shares outstanding:Basic


23,194



22,629



22,501



22,008Diluted


23,194



22,629



22,501



22,008   87




---



##### Table of Contents



ZIPREALTY,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Fourth


Third


Second


FirstYear Ended December 31, 2006

Quarter


Quarter


Quarter


Quarter(In thousands)Net transaction revenues

$
22,396


$
25,420


$
26,195


$
18,648Cost of revenues


12,598



14,238



14,590



10,740Income (loss) from operations


(3,586
)


(375
)


342



(3,306
)Net income (loss)(a)


(20,208
)


622



(220
)


(788
)Net income (loss) per share:Basic

$
(0.96
)

$
0.03


$
(0.01
)

$
(0.04
)Diluted

$
(0.96
)

$
0.03


$
(0.01
)

$
(0.04
)Weighted average common shares outstanding:Basic


21,092



20,410



20,336



20,291Diluted


21,092



23,478



20,336



20,291     (a)
    
    Includes an income tax expense of $17.7 million recorded in
    the fourth quarter of 2006 related to a recording of a valuation
    allowance primarily attributable to the deferred tax assets
    related to net operating loss carryforwards. 88




---



##### Table of Contents



Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure:    Item 9A.
    Controls
    and Procedures:  Evaluation
    of Disclosure Controls and Procedures
  Rule 13a-15(e) 15d-15(e) Form 10-K.
  Managements
    Report on Internal Control Over Financial
    Reporting
  Rule 13a-15(f) Internal Control  Integrated
    Framework.
  Internal Control  Integrated Framework
    Changes
    in Internal Control Over Financial Reporting
    Item 9B.
    Other
    Information:   89




---



##### Table of Contents



PART III  Item 10.
    Directors,
    Executive Officers and Corporate Governance:  Executive
    officers
    Directors
    Section 16(a)
    beneficial ownership reporting compliance
    Code
    of ethics
    Corporate
    governance
    Item 11.
    Executive
    Compensation:    Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters:   90




---



##### Table of Contents



Equity
    compensation plan information
    Number of SecuritiesNumber of





Available forSecurities to be





Issuance UnderIssued Upon


Weighted-Average


Equity CompensationExercise of


Exercise Price of


Plans (ExcludingOutstanding Options,


Outstanding Options,


Securities ReflectedPlan Name and Type

Warrants and Rights


Warrants and Rights


in the First Column)(In thousands)





(In thousands)Equity compensation plans approved by stockholders1999 Stock Option Plan


741


$
4.50



2004 Equity Incentive Plan


3,085


$
8.64



169Equity compensation not approved by stockholdersNew CEO Inducement Grant


312


$
6.06



New SVP Sales Inducement Grant


130


$
6.68



New VP and General Counsel Inducement Grant


50


$
6.68



Total


4,318


$
7.66



169   Item 13.
    Certain
    Relationships and Related Transactions and Director
    Independence:    Item 14.
    Principal
    Accountant Fees and Services:   91




---



##### Table of Contents



PART IV  Item 15.
    Exhibits
    and Financial Statement Schedule:  Documents filed with this report:
  Financial Statements.
    
    Report of independent registered public accounting firm
    Consolidated Balance Sheets at December 31, 2007 and 2006
    Consolidated Statements of Operations for the years ended
    December 31, 2007, 2006 and 2005
    Consolidated Statements of Stockholders Equity for the
    years ended December 31, 2007, 2006 and 2005
    Consolidated Statements of Cash Flows for the years ended
    December 31, 2007, 2006 and 2005
    Notes Consolidated Financial Statements.  Financial Statement Schedule
     Schedule II 
    Valuation and Qualifying Accounts  Balance at


Charged to





Balance atBeginning of


Costs and





End ofDescription

Year


Expenses


Deductions


Year(In thousands)Fiscal year ended December 31, 2005Provision for Doubtful Accounts


29



19



6



42Deferred Tax Asset Valuation


18,210







18,018



192Fiscal year ended December 31, 2006Provision for Doubtful Accounts


42



33



45



30Deferred Tax Asset Valuation


192



18,187







18,379Fiscal year ended December 31, 2007Provision for Doubtful Accounts


30



11



12



29Deferred Tax Asset Valuation


18,379



4,382







22,761     Exhibits.
   92




---



##### Table of Contents



SIGNATURES    ZIPREALTY, INC.
  By:
    /s/  David
    A. Rector       Form 10-K
    Name

Title

Date/s/  J.
    Patrick LashinskyJ.
    Patrick Lashinsky

Chief Executive Officer, President and Director (Principal
    Executive Officer)

March 17, 2008/s/  David
    A. RectorDavid
    A. Rector

Senior Vice President and Chief Financial Officer (Principal
    Financial Officer and Principal Accounting Officer)

March 17, 2008/s/  Donald
    F. WoodDonald
    F. Wood

Chairman of the Board of Directors

March 17, 2008/s/  Elisabeth
    H. DeMarseElisabeth
    H. DeMarse

Director

March 17, 2008/s/  Robert
    C. KagleRobert
    C. Kagle

Director

March 17, 2008/s/  Stanley
    M. Koonce, Jr.Stanley
    M. Koonce, Jr.

Director

March 17, 2008/s/  Richard
    F. SommerRichard
    F. Sommer

Director

March 17, 2008/s/  Gary
    A. WetselGary
    A. Wetsel

Director

March 17, 2008  93




---



##### Table of Contents



Exhibit Index
  ExhibitNumber

Description3
.1(a)(1)

Amended and Restated Certificate of Incorporation3
.2(a)(1)

Bylaws4
.1(1)

Form of Common Stock Certificate10
.1(1)*

Form of Director and Executive Officer Indemnification Agreement10
.2(1)*

1999 Stock Option Plan10
.3(1)*

2004 Equity Incentive Plan10
.3(a)(2)*

Form of Stock Option Award Agreement under 2004 Equity Incentive
    Plan10
.4(1)*

Form of Change of Control Agreement10
.5(1)

Fifth Amended and Restated Investors Rights Agreement
    dated December 17, 200210
.6(1)

Office Lease Agreement between the Registrant and EOP-Emeryville
    Properties, L.L.C. dated November 28, 200110
.6(a)(1)

First Amendment dated March 22, 2002 to Office Lease
    Agreement between the Registrant and EOP-Emeryville Properties,
    L.L.C. dated November 28, 200110
.6(b)(3)

Third Amendment dated November 30, 2005 to Office Lease
    Agreement between ZipRealty, Inc. and CA-Emeryville Properties
    Limited Partnership (as successor in interest to EOP-Emeryville
    Properties, L.L.C.) dated November 28, 200110
.7(4)

Director Compensation Policy (as in effect June 30, 2007)10
.7(a)(5)

Director Compensation Policy (as effective July 1, 2007)10
.8(1)

Form of Primary Warrant to purchase shares of
    Series E-1
    Preferred Stock10
.9(1)

Form of Secondary Warrant to purchase shares of
    Series E-1
    Preferred Stock10
.10(1)

Form of Warrant to purchase shares of Series F Preferred
    Stock10
.11(6)*

Management Incentive Plan  Fiscal Year 200610
.11(a)(7)*

Amended and Restated Management Incentive Plan 
    Fiscal Year 200610
.12(8)*

Management Incentive Plan  Fiscal Year 200710
.13*

Management Incentive Plan  Fiscal Year 200810
.14(9)*

Termination Agreement and Release with Eric A. Danziger executed
    May 15, 200610
.15(10)*

Gary M. Beasley Employment Agreement executed May 15, 200610
.16(11)*

Gary M. Beasley Separation Agreement and Release dated
    February 1, 200710
.17(12)*

Offer Letter to Richard F. Sommer dated August 24, 200610
.18(13)*

Form of Stock Option Award Agreement between the Company and
    Richard F. Sommer dated September 6, 200610
.19(14)*

Termination and Release Agreement with Richard F. Sommer dated
    June 4, 200710
.20(15)*

J. Patrick Lashinsky Employment Agreement dated January 30,
    2007, effective January 17, 200710
.20(a)*

J. Patrick Lashinsky Employment Agreement dated
    September 13, 2007, effective June 4, 200710
.21(16)*

J. Patrick Lashinsky Restricted Stock Award Agreement dated
    September 13, 200710
.22(17)*

J. Patrick Lashinsky Stock Option Award Agreement dated
    September 13, 200710
.23(18)*

Consulting and Separation Agreement with Jeffrey G. Wagoner
    dated February 9, 200710
.24(19)*

Separation Agreement and Release with Richard W. Williams dated
    September 14, 200723
.1

Consent of independent registered public accounting firm24
.1

Power of Attorney (see signature page)31
.1

Certification of Chief Executive Officer, as required by
    Rule 13a-14(a)
    or
    Rule 15d-14(a)
    of the Securities Exchange Act of 193431
.2

Certification of Interim Chief Financial Officer, as required by
    Rule 13a-14(a)
    or
    Rule 15d-14(a)
    of the Securities Exchange Act of 1934 94




---



##### Table of Contents



ExhibitNumber

Description32
.1

Certification of Chief Executive Officer, as required by
    Section 1350 of Chapter 63 of Title 18 of the
    United States Code (18 U.S.C. 1350)32
.2

Certification of Interim Chief Financial Officer, as required by
    Section 1350 of Chapter 63 of Title 18 of the
    United States Code (18 U.S.C. 1350)     (1)
    
    Incorporated by reference to the exhibit of the same number to
    the Registrants Registration Statement on Form
    S-1(File
    No. 333-115657)
    filed with the Securities and Exchange Commission on
    May 20, 2004, as amended.(2)
    
    Incorporated by reference to the exhibit of the same number to
    the Registrants Annual Report on
    Form 10-K
    (File No.
    000-51002)
    for its fiscal year ended December 31, 2004, filed with the
    Securities and Exchange Commission on March 28, 2005.(3)
    
    Incorporated by reference to the exhibit of the same number to
    the Registrants Current Report on
    Form 8-K
    (File No.
    000-51002)
    filed with the Securities and Exchange Commission on
    December 6, 2005.(4)
    
    Incorporated by reference to Exhibit 10.11 to the
    Registrants Quarterly Report on
    Form 10-Q
    (File
    No. 000-51002)
    for the quarterly period ended June 30, 2005, filed with
    the Securities and Exchange Commission on August 12, 2005.(5)
    
    Incorporated by reference to Exhibit 10.1 to the
    Registrants Current Report on
    Form 8-K
    (File
    No. 111-51002)
    filed with the Securities and Exchange Commission on
    June 19, 2007.(6)
    
    Incorporated by reference to Exhibit 10.13 to the
    Registrants Annual Report on
    Form 10-K
    (File
    No. 000-51002)
    for its fiscal year ended December 31, 2005, filed with the
    Securities and Exchange Commission on March 16, 2006.(7)
    
    Incorporated by reference to Exhibit 10.13(a) to the
    Registrants Current Report on
    Form 8-K
    (File
    No. 111-51002)
    filed with the Securities and Exchange Commission on
    October 27, 2006.(8)
    
    Incorporated by reference to Exhibit 10.21 to the
    Registrants Current Report on
    Form 8-K
    (File
    No. 111-51002)
    filed with the Securities and Exchange Commission on
    April 2, 2007.(9)
    
    Incorporated by reference to Exhibit 10.14 to the
    Registrants Current Report on
    Form 8-K
    (File
    No. 111-51002)
    filed with the Securities and Exchange Commission on
    May 16, 2006.  (10)
    
    Incorporated by reference to Exhibit 10.15 to the
    Registrants Current Report on
    Form 8-K
    (File
    No. 111-51002)
    filed with the Securities and Exchange Commission on
    May 16, 2006.(11)
    
    Incorporated by reference to Exhibit 10.2 to the
    Registrants Current Report on
    Form 8-K
    (File
    No. 000-51002)
    filed with the Securities and Exchange Commission on
    February 8, 2007.(12)
    
    Incorporated by reference to Exhibit 10.1 to the
    Registrants Current Report on
    Form 8-K
    (File
    No. 000-51002)
    filed with the Securities and Exchange Commission on
    August 30, 2006.(13)
    
    Incorporated by reference to Exhibit 10.2 to the
    Registrants Current Report on
    Form 8-K
    (File
    No. 000-51002)
    filed with the Securities and Exchange Commission on
    August 30, 2006.(14)
    
    Incorporated by reference to Exhibit 10.1 to the
    Registrants Current Report on
    Form 8-K
    (File
    No. 111-51002)
    filed with the Securities and Exchange Commission on
    June 4, 2007.(15)
    
    Incorporated by reference to Exhibit 10.1 to the
    Registrants Current Report on
    Form 8-K
    (File
    No. 000-51002)
    filed with the Securities and Exchange Commission on
    February 8, 2007.(16)
    
    Incorporated by reference to Exhibit 10.2 to the
    Registrants Current Report on
    Form 8-K
    (File
    No. 000-51002)
    filed with the Securities and Exchange Commission on
    September 19, 2007.(17)
    
    Incorporated by reference to Exhibit 10.3 to the
    Registrants Current Report on
    Form 8-K
    (File
    No. 000-51002)
    filed with the Securities and Exchange Commission on
    September 19, 2007.(18)
    
    Incorporated by reference to Exhibit 10.20 to the
    Registrants Annual Report on
    Form 10-K
    (File
    No. 000-51002)
    filed with the Securities and Exchange Commission on
    March 16, 2007.(19)
    
    Incorporated by reference to Exhibit 10.1 to the
    Registrants Current Report on
    Form 8-K
    (File
    No. 000-51002)
    filed with the Securities and Exchange Commission on
    September 19, 2007.*
    
    Identifies a management contract or compensatory plan of
    arrangement required to be filed as an exhibit to this report. 95