**SECURITIES
AND EXCHANGE COMMISSION**
 **WASHINGTON,
D.C. 20549**
 **____________________**
  **FORM
10-K/A**
 Amendment No. 1
  **x ANNUAL REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934.**
  For the
      fiscal year ended
    December 31, 2004Commission File No.
    0-24298
 
 
 **MILLER
      INDUSTRIES, INC.**(Exact
      Name of Registrant as Specified in Its
Charter)
  
  **Tennessee**
    
    **62-1566286**(State
      or Other Jurisdiction of Incorporation or Organization)
    
    (I.R.S.
      Employer Identification No.)**8503
      Hilltop Drive, Ooltewah, Tennessee**
    
    **37363**(Address
      of Principal Executive Offices)
    
    (Zip
      Code)
  ****
 **(423)
      238-4171**(Registrant’s
      Telephone Number, Including Area Code)
  Securities
registered pursuant to Section 12(b) of the Act:
  Title
      of Each Class
    
    Name
      of Each Exchange on Which RegisteredCommon
      Stock, par value $.01 per share
    
    New
      York Stock Exchange
  Securities
registered pursuant to Section 12(g) of the Act:
  None(Title
      of Class)
 
 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.
  x     Yes    o No
  Indicate
by 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 an accelerated filer (as defined in
Exchange Act Rule 12b-2).
  x     Yes   o No .
  The
aggregate market value of the voting stock for non-affiliates (which for
purposes hereof are all holders other than executive officers and directors) of
the Registrant as of June 30, 2004 (the last business day of the Registrant’s
most recently completed second fiscal quarter) was $94,393,675 (based on
9,573,395 shares held by non-affiliates at $9.86 per share, the last sale price
on the NYSE on June 30, 2004).

At March9, 2005
there were 11,194,782 shares of Common Stock, par value $0.01 per share,
outstanding.

**DOCUMENTS
INCORPORATED BY REFERENCE**

The
information called for by Part III (Items 10, 11, 12, 13 and 14) is incorporated
herein by reference to the Registrant’s definitive proxy statement for its 2005
Annual Meeting of Shareholders which is to be filed pursuant to Regulation
14A.


**EXPLANATORY
NOTES**
  In
reliance on the Order of the Securities and Exchange Commission in Release No.
50754, dated November 30, 2004 (the “Order”), the report of our management on
internal control over financial reporting, and the corresponding attestation of
Joseph Decosimo and Company, PLLC, our independent registered public accounting
firm, were omitted from our Annual Report on Form 10-K for the year ended
December 31, 2004, as filed with the Securities and Exchange Commission on March
14, 2005 (the “Original Filing”).
  Pursuant
to the Order, we are filing this Amendment No. 1 to the Original Filing (this
“Amendment”) to:
  ·
    amend
      and restate Item 9A to include the report of our management on internal
      control over financial reporting; and
  ·
    include
      the correspondingattestation
      report of Joseph Decosimo and Company, PLLC, independent registered public
      accounting firm.
  In
connection with this Amendment, included herewith as exhibits are the
certifications required pursuant to Section 302 of the Sarbanes-Oxley Act of
2002, which have been updated and re-executed as of the date of this Amendment,
and the consent of Joseph Decosimo and Company, PLLC to the inclusion herein of
its attestation report regarding our internal control over financial
reporting.
  In
addition, we are filing this Amendment to correct footnote 7 of our audited
financial statements which contained inadvertent inaccuracies in the amount of
interest reported as having been paid to William G. Miller, our Chairman and
Co-Chief Executive Officer, and to Harbourside Investments LLLP under our senior
credit facility and junior credit facilities, respectively, during
2004.
  Except
for the amendments described above, this Amendment does not modify or update our
previously reported financial statements, results of operations or other related
financial disclosures, or any other disclosures in or exhibits to the Original
Filing.
  **ITEM
8.**  **FINANCIAL
STATEMENTS AND SUPPLEMENTARY DATA**
  The
response to this item is included in Item 15 of this Amendment.
  **ITEM
9A.**  **CONTROLS
AND PROCEDURES**
  **Disclosure
Controls and Procedures**
  We
carried out an evaluation, under the supervision and with the participation of
our management, including our chief executive and chief financial officers, of
the effectiveness of the design and operation of our disclosure controls and
procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities
Exchange Act of 1934, as of the end of the period covered by this report. Based
upon this evaluation, our Co-Chief Executive Officers and our Chief Financial
Officer have concluded that the disclosure controls and procedures were
effective as of the end of the period covered by this Annual Report to ensure
that information required to be disclosed in our reports that we file or submit
under the Exchange Act are recorded, processed, summarized and reported within
the time periods specified in Securities and Exchange Commission rules and
forms.
  **Management’s
Report On Internal Control Over Financial Reporting**
  Management
of Miller Industries, Inc. is responsible for establishing and maintaining
adequate internal control over financial reporting (as defined in Rules
13a-15(f) and 15d-15(f) under the Exchange Act). Our 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 accounting
principles generally accepted in the United States of America.
   1
  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 be
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.
  Management,
including our principal executive officers and principal financial officer,
conducted an evaluation of the effectiveness of our internal control over
financial reporting as of December 31, 2004. In making this assessment,
management used the criteria set forth by the Committee of Sponsoring
Organizations of the Treadway Commission in “Internal Control—Integrated
Framework”. Based on our assessment under those criteria, we concluded that, as
of December 31, 2004, we maintained effective internal control over financial
reporting.
  Joseph
Decosimo and Company, PLLC, the independent registered public accounting firm
who also audited our consolidated financial statements included in this report,
has issued an attestation report on management’s assessment of internal control
over financial reporting, which attestation report appears herein.
  April 29,
2005
  **Attestation
Report of Registered Public Accounting Firm**
  **Report
of Independent Registered Public Accounting Firm**
  Board of
Directors and Shareholders
 Miller
Industries, Inc.
 Ooltewah, Tennessee
  We have
audited management’s assessment, included in the accompanying “Management’s
Report on Internal Control Over Financial Reporting,” that Miller Industries,
Inc. and subsidiaries (Company) maintained effective internal control
over ** financial
reporting as of December 31, 2004, based on criteria established in *Internal Control—Integrated Framework* issued
by the Committee of Sponsoring Organizations of the Treadway Commission (the
COSO criteria) *.* The ** Company’s
management is responsible for maintaining effective internal control over
financial reporting and for its assessment of the effectiveness of internal
control over financial reporting. Our responsibility is to express an opinion on
management’s assessment and an opinion on the effectiveness of the Company’s
internal control over financial reporting based on our audit.
  We
conducted our audit 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 effective
internal control over financial reporting was maintained in all material
respects. Our audit included obtaining an understanding of internal control over
financial reporting, evaluating management’s assessment, testing and evaluating
the design and operating effectiveness of internal control, and performing such
other procedures as we considered necessary in the circumstances. We believe
that our audit provides a reasonable basis for our opinion.
  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.
   2
  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, management’s assessment that Miller Industries, Inc. and subsidiaries
maintained effective internal control over financial reporting as of December
31, 2004, is fairly stated, in all material respects, based on the COSO
criteria. Also in our opinion, Miller Industries, Inc. and subsidiaries
maintained, in all material respects, effective internal control over financial
reporting as of December 31, 2004, based on the COSO criteria.
  We have
also audited, in accordance with the standards of the Public Company Accounting
Oversight Board (United States), the consolidated balance sheets as of December
31, 2004 and 2003, and the related consolidated statements of operations,
shareholders’ equity, and cash flows for each of the three years in the period
ended December 31, 2004, of Miller Industries, Inc. and subsidiaries and our
report dated February
25, 2005, except for note 6 as to which the date is March 7, 2005 ,
expressed ** an
unqualified opinion on those consolidated financial statements.
  /s/
Joseph Decosimo and Company, PLLC
 Chattanooga,
Tennessee
 April 30,
2005
  **Changes
in Internal Control Over Financial Reporting**
  There
were no changes in our internal control over financial reporting that occurred
during our most recent fiscal quarter that have materially affected, or are
reasonably likely to materially affect, our internal control over financial
reporting.
   3
  **ITEM
15.**  **EXHIBITS
AND FINANCIAL STATEMENT SCHEDULES**
  **(a)**  The
following documents are filed as part of this Amendment:
  **1.**  **Financial
Statements**
  **Description**
    **Page
      Number**
      **in
      Report**Report
      of Independent Accountants
    F-2Consolidated
      Balance Sheets as of December 31, 2004 and 2003
    F-3Consolidated
      Statements of Operations for the years ended December 31, 2004, 2003 and
      2002
    F-4Consolidated
      Statements of Shareholders’ Equity for the years ended December 31, 2004,
      2003 and 2002
    F-5Consolidated
      Statements of Cash Flows for the years ended December 31, 2004, 2003 and
      2002
    F-6Notes
      to Consolidated Financial Statements
    F-7
  **2.**  **Financial
Statement Schedules**
  The
following Financial Statement Schedule for the Registrant is filed as part of
this Amendment and should be read in conjunction with the Consolidated Financial
Statements:
  **Description**
    **Page
      Number**
      **in
      Report**Schedule
      II - Valuation and Qualifying Accounts
    S-1
  All
schedules, except those set forth above, have been omitted since the information
required is included in the financial statements or notes or have been omitted
as not applicable or not required.
  **3.**  **Exhibits**
  The
following exhibits are filed with this Amendment:
  **Exhibit
      Number**
    
    **Description**23.1
    
    Consent
      of Joseph Decosimo and Company, PLLC31.1
    
    Certification
      Pursuant to Rules 13a-14(a)/15d-14(a) by Co-Chief Executive
      Officer31.2
    
    Certification
      Pursuant to Rules 13a-14(a)/15d-14(a) by Co-Chief Executive
      Officer31.3
    
    Certification
      Pursuant to Rule 13a-14(a)/15d-14(a) by Chief Financial
      Officer
 ____________________
   **(b)**
    The
      Registrant hereby files as exhibits to this Report the exhibits set forth
      in Item 15(a)3 hereof.
     4
  ****
****
**INDEX
TO FINANCIAL STATEMENTS**

REPORT
      OF INDEPENDENT ACCOUNTANTS
    F-2CONSOLIDATED
      BALANCE SHEETS AS OF DECEMBER 31, 2004 AND 2003
    F-3CONSOLIDATED
      STATEMENTS OF OPERATIONS FOR THE YEARS ENDED
      DECEMBER
      31, 2004, 2003 AND 2002
    F-4CONSOLIDATED
      STATEMENTS OF SHAREHOLDERS’ EQUITY FOR THE YEARS
      ENDED
      DECEMBER 31, 2004, 2003 AND 2002
    F-5CONSOLIDATED
      STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED
      DECEMBER
      31, 2004, 2003 AND 2002
    F-6NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS
    F-7SCHEDULE
      II - VALUATION AND QUALIFYING ACCOUNTS
    S-1F-1**REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTANTING FIRM**

Board of
Directors and Shareholders
Miller
Industries, Inc.
Ooltewah,
Tennessee

We have
audited the accompanying consolidated balance sheets of Miller Industries, Inc.
and subsidiaries as of December 31, 2004 and 2003, and the related consolidated
statements of operations, shareholders’ equity, and cash flows for each of the
three years in the period ended December 31, 2004. These consolidated financial
statements and financial statement schedule are the responsibility of the
company's management. Our responsibility is to express an opinion on these
consolidated financial statements and financial statement schedule 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
consolidated financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the consolidated 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 consolidated financial statements referred to above present fairly,
in all material respects, the financial position of Miller Industries, Inc. and
subsidiaries as of December 31, 2004 and 2003, and the results of their
operations and their cash flows for each of the three years in the period ended
December 31, 2004, in conformity with accounting principles generally accepted
in the United States of America. Also, in our opinion, the financial statement
schedule when considered in relation to the basic consolidated financial
statements taken as a whole, presents fairly, in all material respects, the
information set forth therein.

As
discussed in note 5 to the financial statements, the company changed its method
of accounting for intangible assets in 2002.

/s/
Joseph Decosimo and Company, PLLC


Chattanooga,
Tennessee
February
25, 2005, except for note 6 as to which
the date
is March 7, 2005
F-2**MILLER
INDUSTRIES, INC. AND SUBSIDIARIES**
**CONSOLIDATED
BALANCE SHEETS**
**DECEMBER
31, 2004 AND 200****3**

**(In
thousands, except share data)**

**2004**
    
    **2003****ASSETS****CURRENT
      ASSETS:**Cash
      and temporary investments
    
    **$**
    ******2,812**
    
    $
    5,240Accounts
      receivable, net of allowance for doubtful accounts of $1,116 and $1,062,
      at
      December
      31, 2004 and 2003, respectively
    
    
    **49,336**
    
    
    37,990Inventories,
      net
    
    
    **34,994**
    
    
    26,715Prepaid
      expenses and other
    
    
    **1,525**
    
    
    1,783Current
      assets of discontinued operations held for sale
    
    
    **5,728**
    
    
    23,757Total
      current assets
    
    
    **94,395**
    
    
    95,485**PROPERTY,
      PLANT, AND EQUIPMENT,**net
    
    
    **18,762**
    
    
    20,977**GOODWILL**
    
    
    **11,619**
    
    
    11,619**OTHER
      ASSETS**
    
    
    **1,918**
    
    
    1,783**NONCURRENT
      ASSETS OF DISCONTINUED OPERATIONS****HELD
      FOR SALE**
    
    
    **1,128**
    
    
    1,954**$**
    ******127,822**
    
    $
    131,818**LIABILITIES
      AND SHAREHOLDERS’ EQUITY****CURRENT
      LIABILITIES:**Current
      portion of long-term obligations
    
    **$**
    ******2,052**
    
    $
    2,050Accounts
      payable
    
    
    **36,224**
    
    
    34,164Accrued
      liabilities and other
    
    
    **5,736**
    
    
    4,371Current
      liabilities of discontinued operations held for sale
    
    
    **10,405**
    
    
    23,764Total
      current liabilities
    
    
    **54,417**
    
    
    64,349**LONG-TERM
      OBLIGATIONS**,
      less current portion
    
    
    **24,345**
    
    
    29,927**NONCURRENT
      LIABILITIES OF DISCONTINUED OPERATIONS HELD FOR
    SALE**
    
    
    **2,275**
    
    
    9,545**COMMITMENTS
      AND CONTINGENCIES**(Notes
      6, 8 and 10)**SHAREHOLDERS’
      EQUITY**:Preferred
      stock, $.01 par value; 5,000,000 shares authorized, none issued or
      outstanding
    
    
    **0**
    
    
    0Common
      stock, $.01 par value; 100,000,000 shares authorized, 11,182,606 and
      9,342,151
      outstanding
      at December 31, 2004 and 2003, respectively
    
    
    **112**
    
    
    93Additional
      paid-in capital
    
    
    **157,202**
    
    
    145,090Accumulated
      deficit
    
    
    **(112,468**
    **)**
    
    (117,943
    )Accumulated
      other comprehensive income
    
    
    **1,939**
    
    
    757Total
      shareholders’ equity
    
    
    **46,785**
    
    
    27,997**$**
    ******127,822**
    
    $
    131,818

The
accompanying notes are an integral part of these consolidated balance
sheets.F-3
**MILLER
INDUSTRIES, INC. AND SUBSIDIARIES**
**CONSOLIDATED
STATEMENTS OF OPERATIONS**
**FOR
THE YEARS ENDED DECEMBER 31, 2004, 2003 AND 2002**

**(In
thousands, except per share data)**

**2004**
    
    **2003**
    
    **2002****NET
      SALES**Towing
      and recovery equipment
    
    **$******
    ******236,308**
    
    $
    192,043
    
    $
    203,059Towing
      services
    
    
    **-**
    
    
    13,953
    
    
    28,444**236,308**
    
    
    205,996
    
    
    231,503**COSTS
      AND EXPENSES**Costs
      of operationsTowing
      and recovery equipment
    
    
    **205,021**
    
    
    168,390
    
    
    174,516Towing
      services
    
    
    **-**
    
    
    10,618
    
    
    22,539**205,021**
    
    
    179,008
    
    
    197,055Selling,
      general, and administrative expenses
    
    
    **18,904**
    
    
    17,411
    
    
    19,540Loss
      on sale of business
    
    
    **-**
    
    
    682
    
    
    -Interest
      expense, net
    
    
    **4,657**
    
    
    5,609
    
    
    4,617Total
      costs and expenses
    
    
    **228,582**
    
    
    202,710
    
    
    221,212**INCOME
      FROM CONTINUING OPERATIONS BEFORE INCOME TAXES**
    
    
    **7,726**
    
    
    3,286
    
    
    10,291**INCOME
      TAX PROVISION**
    
    
    **740**
    
    
    1,216
    
    
    7,208**INCOME
      FROM CONTINUING OPERATIONS**
    
    
    **6,986**
    
    
    2,070
    
    
    3,083**DISCONTINUED
      OPERATIONS**Loss
      from discontinued operations, before taxes
    
    
    **(1,371**
    **)**
    
    (17,260
    )
    
    (29,697
    )Income
      tax provision (benefit)
    
    
    **140**
    
    
    (1,037
    )
    
    (2,732
    )Loss
      from discontinued operations, net of taxes
    
    
    **(1,511**
    **)**
    
    (16,223
    )
    
    (26,965
    )**INCOME
      (LOSS) BEFORE CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING
      PRINCIPLE**
    
    
    **5,475**
    
    
    (14,153
    )
    
    (23,882
    )Cumulative
      effect of change in accounting principle
    
    
    **-**
    
    
    -
    
    
    (21,812
    )**NET
      INCOME (LOSS)**
    
    **$******
    ******5,475**
    
    $
    (14,153
    )
    $
    (45,694
    )**BASIC
      INCOME (LOSS) PER COMMON SHARE:**Income
      from continuing operations
    
    **$******
    ******0.64**
    
    $
    0.22
    
    $
    0.34Loss
      from discontinued operations
    
    
    **(0.14**
    **)**
    
    (1.74
    )
    
    (2.89
    )Cumulative
      effect of change in accounting principle
    
    
    **-**
    
    
    -
    
    
    (2.34
    )Basic
      income (loss)
    
    **$******
    ******0.50**
    
    $
    (1.52
    )
    $
    (4.89
    )**DILUTED
      INCOME (LOSS) PER COMMON SHARE:**Income
      from continuing operations
    
    **$******
    ******0.64**
    
    $
    0.22
    
    $
    0.34Loss
      from discontinued operations
    
    
    **(0.14**
    **)**
    
    (1.74
    )
    
    (2.89
    )Cumulative
      effect of change in accounting principle
    
    
    **-**
    
    
    -
    
    
    (2.34
    )Diluted
      income (loss)
    
    **$******
    ******0.50**
    
    $
    (1.52
    )
    $
    (4.89
    )**WEIGHTED
      AVERAGE SHARES OUTSTANDING:**Basic
    
    
    **10,860**
    
    
    9,342
    
    
    9,341Diluted
    
    
    **10,982**
    
    
    9,385
    
    
    9,348

The
accompanying notes are an integral part of these consolidated
statements.
F-4
**MILLER
INDUSTRIES, INC. AND SUBSIDIARIES**

**CONSOLIDATED
STATEMENTS OF SHAREHOLDERS’ EQUITY**
**FOR
THE YEARS ENDED DECEMBER 31, 2004, 2003 AND 2002**

**(In
thousands, except share data)**

**Common
      Stock**
    
    **Additional
      Paid**
      **In
      Capital**
    
    **Accumulated
      Deficit**
    
    **Accumulated
      Other Comprehensive**
      **Income
      (Loss)**
    
    **Total****BALANCE,
      December 31, 2001**
    
    $
    93
    
    $
    145,088
    
    $
    (58,096
    )
    $
    (2,242
    )
    $
    84,843Net
      loss
    
    
    0
    
    
    0
    
    
    (45,694
    )
    
    0
    
    
    (45,694
    )Other
      comprehensive, net of tax:Foreign
      currency translation adjustments
    
    
    0
    
    
    0
    
    
    0
    
    
    788
    
    
    788Unrealized
      loss on financial instruments
    
    
    0
    
    
    0
    
    
    0
    
    
    (240
    )
    
    (240
    )Comprehensive
      loss
    
    
    0
    
    
    0
    
    
    (45,694
    )
    
    548
    
    
    (45,146
    )**BALANCE,
      December 31, 2002**
    
    
    93
    
    
    145,088
    
    
    (103,790
    )
    
    (1,694
    )
    
    39,697Net
      loss
    
    
    0
    
    
    0
    
    
    (14,153
    )
    
    0
    
    
    (14,153
    )Other
      comprehensive, net of tax:Foreign
      currency translation adjustments
    
    
    0
    
    
    0
    
    
    0
    
    
    2,356
    
    
    2,356Unrealized
      gain on financial instruments
    
    
    0
    
    
    0
    
    
    0
    
    
    95
    
    
    95Comprehensive
      loss
    
    
    0
    
    
    0
    
    
    (14,153
    )
    
    2,451
    
    
    (11,702
    )Exercise
      of stock options
    
    
    0
    
    
    2
    
    
    0
    
    
    0
    
    
    2**BALANCE,
      December 31, 2003**
    
    
    93
    
    
    145,090
    
    
    (117,943
    )
    
    757
    
    
    27,997Net
      income
    
    
    0
    
    
    0
    
    
    5,475
    
    
    0
    
    
    5,475Other
      comprehensive, net of tax:Foreign
      currency translation adjustments
    
    
    0
    
    
    0
    
    
    0
    
    
    1,085
    
    
    1,085Unrealized
      gain on financial instruments
    
    
    0
    
    
    0
    
    
    0
    
    
    97
    
    
    97Comprehensive
      income
    
    
    0
    
    
    0
    
    
    5,475
    
    
    1,182
    
    
    6,657Issuance
      of common stock for conversion and exchange of subordinated debt and
      warrants (1,317,700)
    
    
    13
    
    
    7,527
    
    
    0
    
    
    0
    
    
    7,540Issuance
      of common stock to unaffiliated private investors
(480,000)
    
    
    5
    
    
    4,230
    
    
    0
    
    
    0
    
    
    4,235Issuance
      of common stock to non-employee directors (33,966)
    
    
    1
    
    
    328
    
    
    0
    
    
    0
    
    
    329Exercise
      of stock options
    
    
    0
    
    
    27
    
    
    0
    
    
    0
    
    
    27**BALANCE,
      December 31, 2004**
    
    $
    112
    
    $
    157,202
    
    $
    (112,468
    )
    $
    1,939
    
    $
    46,785

The
accompanying notes are an integral part of these consolidated
statements
F-5**MILLER
INDUSTRIES, INC. AND SUBSIDIARIES**
**CONSOLIDATED
STATEMENTS OF CASH FLOWS**
**FOR
THE YEARS ENDED DECEMBER 31, 2004, 2003 AND 2002**

**(In
thousands)**

**2004**
    
    **2003**
    
    **2002****OPERATING
      ACTIVITIES:**Net
      income (loss)
    
    **$******
    ******5,475**
    
    $
    (14,153
    )
    $
    (45,694
    )Adjustments
      to reconcile net income (loss) to net cash (used in) provided by operating
      activities:Loss
      from discontinued operations
    
    
    **1,511**
    
    
    16,223
    
    
    26,965Depreciation
      and amortization
    
    
    **3,232**
    
    
    3,715
    
    
    4,354Amortization
      of deferred financing costs
    
    
    **798**
    
    
    4,627
    
    
    2,878Provision
      for doubtful accounts
    
    
    **567**
    
    
    492
    
    
    563Issuance
      of non-employee director shares
    
    
    **329**
    
    
    -
    
    
    -Cumulative
      effect of change in accounting principle
    
    
    **-**
    
    
    -
    
    
    21,812Loss
      on disposition of business
    
    
    **-**
    
    
    682
    
    
    -(Gain)
      Loss on disposals of property, plant, and equipment
    
    
    **10**
    
    
    54
    
    
    (4
    )Deferred
      income tax provision
    
    
    **-**
    
    
    -
    
    
    3,726Paid
      in kind interest
    
    
    **-**
    
    
    -
    
    
    574Proceeds
      from tax refunds
    
    
    **-**
    
    
    -
    
    
    9,046Changes
      in operating assets and liabilities:Accounts
      receivable
    
    
    **(11,199**
    **)**
    
    7,393
    
    
    (1,290
    )Inventories
    
    
    **(7,288**
    **)**
    
    2,200
    
    
    5,286Prepaid
      expenses and other
    
    
    **285**
    
    
    (997
    )
    
    (80
    )Other
      assets
    
    
    **(864**
    **)**
    
    (277
    )
    
    (31
    )Accounts
      payable
    
    
    **1,271**
    
    
    7,942
    
    
    644Accrued
      liabilities and other
    
    
    **1,501**
    
    
    (2,231
    )
    
    (5,767
    )Net
      cash (used in) provided by operating activities from continuing
      operations
    
    
    **(4,372**
    **)**
    
    25,670
    
    
    22,982Net
      cash used in operating activities from discontinued
    operations
    
    
    **(1,341**
    **)**
    
    (12,292
    )
    
    (3,392
    )Net
      cash (used in) provided by operating activities
    
    
    **(5,713**
    **)**
    
    13,378
    
    
    19,590**INVESTING
      ACTIVITIES:**Purchases
      of property, plant, and equipment
    
    
    **(695**
    **)**
    
    (1,178
    )
    
    (2,647
    )Proceeds
      from sale of property, plant, and equipment
    
    
    **15**
    
    
    51
    
    
    52Proceeds
      from sale of business
    
    
    **-**
    
    
    3,645
    
    
    -Payments
      received on notes receivables
    
    
    **122**
    
    
    808
    
    
    142Net
      cash (used in) provided by investing activities from continuing
      operations
    
    
    **(558**
    **)**
    
    3,326
    
    
    (2,453
    )Net
      cash provided by investing activities from discontinued
      operations
    
    
    **4,454**
    
    
    5,530
    
    
    20,691Net
      cash provided by investing activities
    
    
    **3,896**
    
    
    8,856
    
    
    18,238**FINANCING
      ACTIVITIES:**Net
      borrowings (payments) under Senior Credit Facility
    
    
    **3,093**
    
    
    (1,569
    )
    
    (1,310
    )Payments
      on long-term obligations
    
    
    **(3,542**
    **)**
    
    (3,301
    )
    
    (4,948
    )Borrowings
      under long-term obligations
    
    
    **2,039**
    
    
    260
    
    
    1,007Additions
      to deferred financing costs
    
    
    **(522**
    **)**
    
    (3,080
    )
    
    (1,699
    )Termination
      of interest rate swap
    
    
    **96**
    
    
    97
    
    
    (239
    )Proceeds
      from issuance of common stock
    
    
    **4,235**
    
    
    -
    
    
    -Proceeds
      from exercise of stock options
    
    
    **27**
    
    
    2
    
    
    -Net
      cash provided by (used in) financing activities from continuing
      operations
    
    
    **5,426**
    
    
    (7,591
    )
    
    (7,189
    )Net
      cash used in financing activities from discontinued
    operations
    
    
    **(7,910**
    **)**
    
    (12,667
    )
    
    (37,161
    )Net
      cash used in financing activities
    
    
    **(2,484**
    **)**
    
    (20,258
    )
    
    (44,350
    )**EFFECT
      OF EXCHANGE RATE CHANGES ON CASH AND TEMPORARY
      INVESTMENTS**
    
    
    **293**
    
    
    1,569
    
    
    508**NET
      CHANGE IN CASH AND TEMPORARY INVESTMENTS**
    
    
    **(4,008**
    **)**
    
    3,545
    
    
    (6,014
    )**CASH
      AND TEMPORARY INVESTMENTS, beginning of year**
    
    
    **5,240**
    
    
    2,097
    
    
    9,863**CASH
      AND TEMPORARY INVESTMENTS-DISCONTINUED OPERATIONS, beginning of
      year**
    
    
    **2,154**
    
    
    1,752
    
    
    -**CASH
      AND TEMPORARY INVESTMENTS-DISCONTINUED OPERATIONS, end of
      year**
    
    
    **574**
    
    
    2,154
    
    
    1,752**CASH
      AND TEMPORARY INVESTMENTS, end of year**
    
    **$******
    ******2,812**
    
    $
    5,240
    
    $
    2,097**SUPPLEMENTAL
      DISCLOSURE OF CASH FLOW INFORMATION:**Debt
      conversion
    
    **$******
    ******7,540**
    
    $
    -
    
    $
    -Cash
      payments for interest
    
    **$******
    ******4,173**
    
    $
    5,060
    
    $
    7,392Cash
      payments for income taxes
    
    **$******
    ******815**
    
    $
    358
    
    $
    581

The
accompanying notes are an integral part of these consolidated
statements
F-6


**MILLER
INDUSTRIES, INC. AND SUBSIDIARIES**

**NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS**

**1.**
    **ORGANIZATION
      AND NATURE OF OPERATIONS**

Miller
Industries, Inc. and subsidiaries (“the Company”) was historically an integrated
provider of vehicle towing and recovery equipment. As further described in Note
2, during the year ended December 31, 2002, the Company’s management and board
of directors made the decision to divest of the remainder of its towing services
segment, as well as the operations of the distribution group of the towing and
recovery equipment segment. At December 31, 2004, the Company had substantially
completed this process. The principal markets for the Company’s towing and
recovery equipment are approximately 120 independent distributors and users of
towing and recovery equipment located primarily throughout North America and
other customers throughout the world. The Company’s products are marketed under
the brand names of Century, Challenger, Holmes, Champion, Eagle, Jige, Boniface,
Vulcan, and Chevron.

**2.**
    **DISCONTINUED
      OPERATIONS**

During
the fourth quarter of the year ended December 31, 2002, the Company’s management
and board of directors made the decision to divest of its remaining towing
services segment, as well as the operations of the distribution group of the
towing and recovery equipment segment.

During
the year ended December 31, 2002, the Company disposed of assets of 29
underperforming towing service businesses, as well as assets of
other businesses in its towing services segment. Total proceeds from
the sales were $23.5 million which included $22.7 million in cash and $0.8
million in notes receivable. Losses on the sales of discontinued operations were
$5.1 million.

During
the year ended December 31, 2003, the Company disposed of substantially all of
the assets of 16 towing service businesses, as well as assets of
other businesses in its towing services segment. Total proceeds from
the sales were $6.8 million which included $6.6 million in cash and $0.2 million
in notes receivable. Losses on the sales of discontinued operations were $3.8
million. As of March 1, 2005, only miscellaneous assets from previously sold
businesses remain.

During
the year ended December 31, 2003, the Company sold one distributor location with
total proceeds of approximately $1.9 million in cash and $0.8 million
subordinated notes receivable. The Company sold seven distributor locations
during the year ended December 31, 2004. Total proceeds from these sales were
$3.3 million in cash and $0.9 million in notes receivable. In accordance with
the board of directors’ decision to divest of the distribution group, the
Company has entered into negotiations for the disposition of the one remaining
location.

In
accordance with SFAS No. 144, “Accounting for the Impairment or Disposal of
Long-Lived Assets”, the assets for the towing services segment and the
distribution group are considered a “disposal group” and are no longer being
depreciated. All assets and liabilities and results of operations associated
with these assets have been separately presented in the accompanying financial
statements as of December 31, 2002 as discontinued operations. Results of
operations for the towing services segment and the distribution group reflect
interest expense for debt directly attributing to these businesses, as well as
an allocation of corporate debt based on intercompany balances.

The
results of operations and loss on disposal associated with certain towing
services businesses, which were sold in June 2003, have been reclassified from
discontinued operations to continuing operations given the Company’s continuing
involvement in the operations of the disposal components via a consulting
agreement, and the Company’s ongoing interest in the cash flows of the
operations of the disposal components via a long-term license agreement that was
finalized at the time of the sale. The Company applied this change retroactively
by adjusting the Consolidated Statement of Operations and the Consolidated
Statements of Cash Flows.
F-7The
operating results for the discontinued operations of the towing services segment
and the distributor group for the years ended December 31, 2004, 2003 and 2002
were as follows (in thousands):

**2004**
    
    **2003**
    
    **2002****Dist.**
    
    
    **Towing**
    
    
    **Total**
    
    
    **Dist.**
    
    
    **Towing**
    
    
    **Total**
    
    
    **Dist.**
    
    
    **Towing**
    
    
    **Total**Net
      Sales
    
    **$******
    ******37,810**
    
    **$******
    ******-**
    
    **$******
    ******37,810**
    
    $
    68,724
    
    $
    8,356
    
    $
    77,080
    
    $
    85,353
    
    $
    93,124
    
    $
    178,477Operating
      income (loss)
    
    
    **(659**
    **)**
    
    **(111**
    **)**
    
    **(770**
    **)**
    
    (371
    )
    
    (2,764
    )
    
    (3,135
    )
    
    80
    
    
    (5,730
    )
    
    (5,650
    )Net
      loss before taxes
    
    
    **(1,244**
    **)**
    
    **(127**
    **)**
    
    **(1,371**
    **)**
    
    (6,449
    )
    
    (10,811
    )
    
    (17,260
    )
    
    (6,370
    )
    
    (23,327
    )
    
    (29,697
    )Loss
      from discontinued operations
    
    
    **(1,276**
    **)**
    
    **(235**
    **)**
    
    **(1,511**
    **)**
    
    (6,607
    )
    
    (9,616
    )
    
    (16,223
    )
    
    (6,930
    )
    
    (20,035
    )
    
    (26,965
    )

The
following assets and liabilities are reclassified as held for sale at December
31, 2004 and 2003 (in thousands):

**2004**
    
    **2003****Dist.**
    
    **Towing**
    
    **Total**
    
    **Dist.**
    
    **Towing**
    
    **Total**Cash
      and temporary investments
    
    **$******
    ******574**
    
    **$******
    ******-**
    
    **$******
    ******574**
    
    $
    2,154
    
    $
    -
    
    $
    2,154Accounts
      receivable, net
    
    
    **1,444**
    
    
    **492**
    
    
    **1,936**
    
    
    3,603
    
    
    1,150
    
    
    4,753Inventories
    
    
    **3,144**
    
    
    **-**
    
    
    **3,144**
    
    
    14,266
    
    
    -
    
    
    14,266Prepaid
      expenses and other current assets
    
    
    **74**
    
    
    **-**
    
    
    **74**
    
    
    157
    
    
    2,427
    
    
    2,584Current
      assets of discontinued operations held for sale
    
    **$******
    ******5,236**
    
    **$******
    ******492**
    
    **$******
    ******5,728**
    
    $
    20,180
    
    $
    3,577
    
    $
    23,757Property,
      plant and equipment
    
    
    **16**
    
    
    **1,112**
    
    
    **1,128**
    
    
    22
    
    
    1,932
    
    
    1,954Noncurrent
      assets of discontinued operations held for sale
    
    **$******
    ******16**
    
    **$******
    ******1,112**
    
    **$******
    ******1,128**
    
    $
    22
    
    $
    1,932
    
    $
    1,954Current
      portion of long-term debt
    
    
    **223**
    
    
    **442**
    
    
    **665**
    
    
    852
    
    
    928
    
    
    1,780Accounts
      payable
    
    
    **1,932**
    
    
    **4,596**
    
    
    **6,528**
    
    
    3,644
    
    
    8,416
    
    
    12,060Accrued
      liabilities and other
    
    
    **637**
    
    
    **2,575**
    
    
    **3,212**
    
    
    4,792
    
    
    5,132
    
    
    9,924Current
      liabilities of discontinued operations held for sale
    
    **$******
    ******2,792**
    
    **$******
    ******7,613**
    
    **$******
    ******10,405**
    
    $
    9,288
    
    $
    14,476
    
    $
    23,764Long-term
      debt
    
    
    **2,275**
    
    
    **-**
    
    
    **2,275**
    
    
    9,094
    
    
    451
    
    
    9,545Noncurrent
      liabilities of discontinued operations held for sale
    
    **$******
    ******2,275**
    
    **$******
    ******-**
    
    **$******
    ******2,275**
    
    $
    9,094
    
    $
    451
    
    $
    9,545

**3.**
    **SUMMARY
      OF SIGNIFICANT ACCOUNTING POLICIES**

**Use
of Estimates in the Preparation of Financial Statements**

The
preparation of financial statements in conformity with 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 financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.

**Consolidation**

The
accompanying consolidated financial statements include the accounts of Miller
Industries, Inc. and its subsidiaries. All significant intercompany transactions
and balances have been eliminated.

**Cash
and Temporary Investments**

Cash and
temporary investments include all cash and cash equivalent investments with
original maturities of three months or less.
F-8**Fair
Value of Financial Instruments**

The
carrying values of cash and temporary investments, accounts receivable, accounts
payable, and accrued liabilities are reasonable estimates of their fair values
because of the short maturity of these financial instruments. The carrying
values of long-term obligations are reasonable estimates of their fair values
based on the rates available for obligations with similar terms and
maturities.

**Inventories**

Inventory
costs include materials, labor, and factory overhead. Inventories are stated at
the lower of cost or market, determined on a first-in, first-out basis.
Inventories for continuing operations at December 31, 2004 and 2003 consisted of
the following (in thousands):

**2004**
    
    **2003**Chassis
    
    **$******
    ******2,556**
    
    $
    4,286Raw
      materials
    
    
    **15,667**
    
    
    10,253Work
      in process
    
    
    **10,338**
    
    
    7,892Finished
      goods
    
    
    **6,433**
    
    
    4,284**$******
    ******34,994**
    
    $
    26,715

**Property,
Plant, and Equipment**

Property,
plant, and equipment are recorded at cost. Depreciation for financial reporting
purposes is provided using the straight-line method over the estimated useful
lives of the assets. Accelerated depreciation methods are used for income tax
reporting purposes. Estimated useful lives range from 20 to 30 years for
buildings and improvements and 5 to 10 years for machinery and equipment,
furniture and fixtures, and software costs. Expenditures for routine maintenance
and repairs are charged to expense as incurred. Expenditures related to major
overhauls and refurbishments of towing services equipment that extend the
related useful lives are capitalized. Internal labor is used in certain capital
projects.

Property,
plant, and equipment for continuing operations at December 31, 2004 and 2003
consisted of the following (in thousands):

**2004**
    
    **2003**Land
    
    **$******
    ******1,783**
    
    $
    1,764Buildings
      and improvements
    
    
    **19,207**
    
    
    18,956Machinery
      and equipment
    
    
    **12,153**
    
    
    11,500Furniture
      and fixtures
    
    
    **5,094**
    
    
    5,587Software
      costs
    
    
    **6,192**
    
    
    6,142**44,429**
    
    
    43,949Less
      accumulated depreciation
    
    
    **(25,667**
    **)**
    
    (22,972
    )**$******
    ******18,762**
    
    $
    20,977

The
Company recognized $3,092,000, $3,570,000 and $4,192,000, in depreciation
expense for continuing operations in 2004, 2003 and 2002, respectively.
Depreciation expense for discontinued operations was $148,000 and $2,196,000 in
2003 and 2002, respectively, and is included in the loss from discontinued
operations in the consolidated statement of operations.
F-9
The
Company capitalizes costs related to software development in accordance with
established criteria, and amortizes those costs to expense on a straight-line
basis over five years. System development costs not meeting proper criteria for
capitalization are expensed as incurred.

**Income
(Loss) Per Common Share**

Basic
income (loss) per common share is computed by dividing net income (loss) by the
weighted average number of common shares outstanding. Diluted income (loss) per
common share is calculated by dividing net income (loss) by the weighted average
number of common and potential dilutive common shares outstanding. Diluted net
income per common share takes into consideration the assumed exercise of
outstanding stock options resulting in approximately 122,000, 43,000 and 7,000,
potential dilutive common shares in 2004, 2003 and 2002,
respectively.

**Goodwill
and Long-Lived Assets**

Goodwill
is accounted for in accordance with SFAS No. 141 “Business Combinations” and
SFAS No. 142 “Goodwill and Other Intangible Assets”. Upon adoption of these
standards in January 2002, the Company ceased to amortize goodwill (see Note 5
for further discussion).

In
accordance with SFAS No. 144, “Accounting for the Impairment of Long-Lived
Assets”, management evaluates the carrying value of long-lived assets when
significant adverse changes in economic value of these assets requires an
analysis, including property and equipment and other intangible assets. With the
adoption of SFAS No. 144, in January 2002, a long-lived asset is considered
impaired when its fair value is less than its carrying value. In that event, a
loss is calculated based on the amount the carrying value exceeds the fair value
which is estimated based on future cash flows. Prior to adopting SFAS No. 144, a
long-lived asset was considered impaired when undiscounted cash flows or fair
value, whichever was more readily determinable, to be realized from such asset
was less than the carrying value.

**Patents,
Trademarks, and Other Purchased Product Rights**

The cost
of acquired patents, trademarks, and other purchased product rights is
capitalized and amortized using the straight-line method over various periods
not exceeding 20 years. Total accumulated amortization of these assets was
$1,415,000 and $1,275,000, for continuing operations at December 31, 2004 and
2003, respectively. Amortization expense for continuing operations in 2004, 2003
and 2002 was $140,000, $145,000 and $162,000, respectively. Amortization expense
for discontinued operations was $149,000 in 2002, and is included in the loss
from discontinued operations in the consolidated statement of
operations.Based on
the current amount of intangible assets subject to amortization, the estimated
amortization expense for the succeeding five years are as follows: 2005 -$139,000;2006 -$113,000;2007 -$0;2008 -$0;2009 -$0. As
acquisitions and dispositions of intangible assets occur in the future, these
amounts may vary.

**Deferred
Financing Costs**

All
deferred financing costs are included in other assets of continuing operations
and are amortized over the terms of the respective obligations. Total
accumulated amortization of deferred financing costs at December 31, 2004 and
2003 was $1,093,000 and$300,000,
respectively. Amortization expense in 2004, 2003 and 2002, was $798,000,$4,627,000
and $2,878,000,
respectively, and is included in interest expense in the accompanying
consolidated statements of operations.
F-10**Accrued
Liabilities and Other**

Accrued
liabilities and other consisted of the following for continuing operations at
December 31, 2004 and 2003 (in thousands):

**2004**
    
    **2003**Accrued
      wages, commissions, bonuses, and benefits
    
    **$******
    ******3,317**
    
    $
    2,747Accrued
      income taxes
    
    
    **85**
    
    
    204Other
    
    
    **2,334**
    
    
    1,420**$******
    ******5,736**
    
    $
    4,371

**Stock-Based
Compensation**

The
Company accounts for its stock-based compensation plans under Accounting
Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees”. The
Company has adopted the disclosure option of SFAS No. 123, “Accounting for
Stock-Based Compensation”. Accordingly, no compensation cost has been recognized
for stock option grants since the options have exercise prices equal to the
market value of the common stock at the date of grant.

For SFAS
No. 123 purposes, the fair value of each option grant has been estimated as of
the date of grant using the Black-Scholes option-pricing model with the
following weighted average assumptions for grants in 2004 and 2002,
respectively: expected dividend yield of 0%; expected volatility of 43% and 84%;
risk-free interest rate of 2.94% and 3.84%; and expected lives of 5.5 years for
2004 and 3.0 years for 2002. Using these assumptions, the fair value of options
granted in 2004 and 2002 is approximately $1,242,000 and $53,000, respectively,
which would be amortized as compensation expense over the vesting period of the
options. No options were granted during 2003.

Had
compensation cost for stock option grants in 2004, 2003 and 2002 been determined
based on the fair value at the grant dates consistent with the method prescribed
by SFAS No. 123, the Company’s net income (loss) and net income (loss) per
common share would have been adjusted to the pro forma amounts indicated below
(in thousands, except per share data):

**2004**
    
    **2003**
    
    **2002**Net
      income (loss) available to common stockholders, as
reported
    
    **$******
    ******5,475**
    
    $
    (14,153
    )
    $
    (45,694
    )Deduct:
      Total stock-based employee compensation expense
      determined
      under fair value based method for all awards, net
      of
      related tax effects
    
    
    **(262**
    **)**
    
    (265
    )
    
    (400
    )Net
      income (loss) available to common stockholders, pro forma
    
    **$******
    ******5,213**
    
    $
    (14,418
    )
    $
    (46,094
    )Income
      (loss) per common share:Basic,
      as reported
    
    **$******
    ******0.50**
    
    $
    (1.52
    )
    $
    (4.89
    )Diluted,
      as reported
    
    **$******
    ******0.50**
    
    $
    (1.52
    )
    $
    (4.89
    )Basic,
      pro forma
    
    **$******
    ******0.48**
    
    $
    (1.54
    )
    $
    (4.93
    )Diluted,
      pro forma
    
    **$******
    ******0.48**
    
    $
    (1.54
    )
    $
    (4.93
    )

**Product
Warranty**

The
Company provides a one-year limited product and service warranty on certain of
its products. The Company provides for the estimated cost of this warranty at
the time of sale. Warranty expense for continuing operations in 2004, 2003 and
2002, was $1,520,000, $1,547,000 and $1,489,000, respectively.
F-11The table
below provides a summary of the warranty liability for December 31, 2004 and
2003 (in thousands):

**2004**
    
    **2003**Accrual
      at beginning of the year
    
    **$******
    ******639**
    
    $
    554Provision
    
    
    **1,520**
    
    
    1,547Settlement
    
    
    **(1,494**
    **)**
    
    (1,462
    )Accrual
      at end of year
    
    **$******
    ******665**
    
    $
    639

**Credit
Risk**

Financial
instruments that potentially subject the Company to significant concentrations
of credit risk consist principally of cash investments and trade accounts
receivable. The Company places its cash investments with high-quality financial
institutions and limits the amount of credit exposure to any one institution.
The Company’s trade receivables are primarily from independent distributors of
towing and recovery equipment and towing service customers. Such receivables are
generally not collateralized for towing service customers. The Company monitors
its exposure for credit losses and maintains allowances for anticipated
losses.

**Revenue
Recognition**

Revenue
is recorded by the Company when equipment is shipped to independent distributors
or other customers. Revenue from towing services (discontinued operations) is
recognized when services are performed.

**Financial
Instruments**

SFAS No.
133, “Accounting for Derivative Instruments and Hedging Activities”, establishes
accounting and reporting standards requiring that every derivative instrument
(including certain derivative instruments embedded in other contracts) be
recorded in the balance sheet as either an asset or liability measured at its
fair value. Changes in the derivative’s fair value are recognized currently in
earnings unless specific hedge accounting criteria are met. Special accounting
for qualifying hedges allows a derivative’s gains and losses to offset related
results on the hedged item in the income statement, and requires that a company
must formally document, designate, and assess the effectiveness of transactions
that receive hedge accounting. The adoption of SFAS No. 133 did not have a
material effect on the Company’s financial statements. See Note 8 for additional
discussions.

**Foreign
Currency Translation**

The
functional currency for the Company’s foreign operations is the applicable local
currency. The translation from the applicable foreign currencies to U.S. dollars
is performed for balance sheet accounts using current exchange rates in effect
at the balance sheet date, historical rates for equity and the weighted average
exchange rate during the period for revenue and expense accounts. The gains or
losses resulting from such translations are included in shareholders’ equity.
For intercompany debt denominated in a currency other than the functional
currency, the remeasurement into the functional currency is also included in
stockholders’ equity as the amounts are considered to be of a long-term
investment nature.

**Recent
Accounting Pronouncements**

In
November 2004, the Financial Accounting Standards Board (FASB) issued SFAS No.
151 “Inventory Costs - an amendment of ARB No. 43, Chapter 4”. This statement
clarifies the accounting for abnormal amounts of idle facility expense, freight,
handling costs and spoilage. This statement also requires the allocation of
fixed production overhead costs be based on normal production capacity. The
provisions of SFAS No. 151 are effective for inventory costs beginning in
January 2006, with adoption permitted for inventory costs incurred beginning in
January 2005. The adoption of this statement will not have a material impact on
the Company’s results of operations or financial position.

In
December 2004, the FASB issued SFAS No. 123R, “Share-Based Payment”. This
statement requires the determination of the fair value of share-based
compensation at the grant date and the recognition of the related compensation
expense over the period in which the share-based compensation vests. As required
by SFAS No. 123R, the Company will adopt the new accounting standard effective
July 1, 2005. The Company will transition the new guidance using the modified
prospective method. The Company expects the application of the expensing
provision of SFAS No. 123R will result in pretax expense of approximately
$168,000 in the second half of 2005. Applying the same assumptions used for the
2004 pro forma disclosure in Note 3, the Company estimates its pretax expense
associated with previous stock option grants to be approximately $308,000 in
each of 2006 and 2007, and $77,000 in 2008.
F-12In
December 2004, the FASB issued SFAS No. 153, “Exchanges of Nonmonetary Assets-an
amendment of APB Opinion No. 29”. SFAS No. 153 addresses the measurement of
exchanges of nonmonetary assets. It eliminates the exception from fair value
measurement for nonmonetary exchanges of similar productive assets in paragraph
21(b) of APB Opinion No. 29 “Accounting for Nonmonetary Transactions” and
replaces it with an exception for exchanges that do not have commercial
substance. A nonmonetary exchange has commercial substance if the future cash
flows of the entity are expected to change significantly as a result of the
exchange. As required by SFAS No. 153, the Company will adopt this new
accounting standard effective July 1, 2005. The adoption of SFAS No. 153 is not
expected to have a material impact on the Company’s financial
statements.

**Reclassifications**

Certain
prior year amounts have been reclassified to conform to current year
presentation, with no impact on previously reported shareholders’ equity or net
income (loss).

**4.**
    **SPECIAL
      CHARGES**


The
Company periodically reviews the carrying amount of long-lived assets and
goodwill in both its towing services and towing equipment segments to determine
if those assets may be recoverable based upon the future operating cash flows
expected to be generated by those assets. As a result of such review, the
Company concluded that the carrying value of such assets of certain towing
services businesses and certain assets within the Company’s towing and
recovery equipment segment were not fully recoverable.

Charges
of $3,792,000 and $10,191,000 were recorded in 2003 and 2002, respectively, to
write-down the carrying value of certain long-lived assets (primarily property
and equipment) and other special changes in related markets to estimated fair
value. The Company determined fair value for these assets on a market by market
basis taking into consideration various factors affecting the valuation in each
market.

The
Company also reviewed the carrying values of the goodwill associated with
certain investments within its towing and recovery equipment segment. This
evaluation indicated that the recorded amounts of goodwill for certain of these
investments were not fully recoverable. The Company recorded $1,113,000 and
$1,637,000 of additional costs related to the write-down of the carrying value
of other long-lived assets of its towing and recovery equipment segment in 2003
and 2002, respectively.

Management
believes its long-lived assets are appropriately valued following the impairment
charges.

**5.**
    **GOODWILL
      AND OTHER LONG-LIVED ASSETS**

In June
2001, the FASB issued SFAS No. 141, “Business Combinations” and SFAS No. 142,
“Goodwill and Other Intangible Assets” (collectively the “Standards”). The
Standards were effective for fiscal years beginning after December 15, 2001.
SFAS No. 141 requires companies to recognize acquired identifiable intangible
assets separately from goodwill if control over the future economic benefits of
the asset results from contractual or other legal rights or the intangible asset
is capable of being separated or divided and sold, transferred, licensed,
rented, or exchanged. The Standards require the value of a separately
identifiable intangible asset meeting any of the criteria to be measured at its
fair value. SFAS No. 142 requires that goodwill not be amortized and that
amounts recorded as goodwill be tested for impairment. Annual impairment tests
have to be performed at the lowest level of an entity that is a business and
that can be distinguished, physically and operationally and for internal
reporting purposes, from the other activities, operations, and assets of the
entity.

Upon
adoption of SFAS No. 142 in January 2002, the Company ceased to amortize
goodwill. In lieu of amortization, the Company performed an initial impairment
review of goodwill in 2002 and annual impairment reviewsthereafter.
As a result of impairment reviews, the Company wrote-off goodwill of $2,886,000
in the towing equipment segment and $18,926,000 in the towing services segment
during 2002. The write-off has been accounted for as a cumulative effect of
change in accounting principle to reflect application of the new accounting
standards.
F-13**6.****LONG-TERM
OBLIGATIONS AND LINE OF CREDIT**

**Long-Term
Obligations**

Long-term
obligations consisted of the following for continuing operations at December 31,
2004 and 2003 (in thousands):

**2004**
    
    **2003**Outstanding
      borrowings under Senior Credit Facility
    
    **$******
    ******19,987**
    
    $
    13,448Outstanding
      borrowings under Junior Credit Secured Facility
    
    
    **4,211**
    
    
    16,743Mortgage
      notes payable, weighted average interest rate of 5.25%,
      payable
      in monthly installments, maturing 2005 to 2009
    
    
    **1,991**
    
    
    1,304Equipment
      notes payable, weighted average interest rate of 9.97%,
      payable
      in monthly installments, maturing 2005 to 2009
    
    
    **133**
    
    
    349Other
      notes payable, weighted average interest rate of 6.38%,
      payable
      in monthly installments, maturing 2005 to 2006
    
    
    **75**
    
    
    133**26,397**
    
    
    31,977Less
      current portion
    
    
    **(2,052**
    **)**
    
    (2,050
    )**$******
    ******24,345**
    
    $
    29,927

The
December 31, 2004 and 2003 figures do not include $2.9 million and $10.4
million, respectively, outstanding under the Senior Credit Facility relating to
discontinued operations. Obligations under the Senior Credit Facility are
allocated to discontinued operations based on the assets used to determine
borrowing availability for collateral reporting. Certain equipment and
manufacturing facilities are pledged as collateral under the mortgage and
equipment notes payable.

**2001
Credit Facility**

*Senior
Credit Facility*. In July
2001, the Company entered into a four year Senior Credit Facility (the “Senior
Credit Facility”) with a syndicate of lenders to replace its existing credit
facility. The Senior Credit Facility has been amended several times. The current
lenders under the Senior Credit Facility are William G. Miller, the Company’s
Chairman of the Board and Co-Chief Executive Officer, and CIT Group/Business
Credit, Inc. (“CIT”), with Mr. Miller’s portion of the loan being subordinated
to that of CIT. As discussed in further detail below, the Senior Credit Facility
is scheduled to mature in July 2005, but the Company has been granted an option,
exercisable through July 10, 2005, to extend the maturity date to July
2006.

As
amended, the Senior Credit Facility consists of an aggregate $32.0 million
credit facility, including a $15.0 million revolving loan, a $5.0 million term
loan and a $12.0 million term loan. The revolving credit facility provides for
separate and distinct loan commitment levels for the Company’s towing and
recovery equipment segment and RoadOne segment, respectively.

Borrowing
availability under the revolving portion of the Senior Credit Facility is based
on a percentage of eligible inventory and accounts receivable (determined on
eligibility criteria set forth in the credit facility) and subject to a maximum
borrowing limitation. Borrowings under the term loans are collateralized by
substantially all of the Company’s domestic property, plants, and equipment. The
Company is required to make monthly amortization payments of $167,000 on the
first term loan, but the amortization payments due on November 1, 2003, December
1, 2003, and January 1, 2004 were deferred until the maturity date. The Senior
Credit Facility bears interest at the prime rate (as defined) plus 2.75%,
subject to the rights of the senior lender agent or a majority of the lenders to
charge a default rate equal to the prime rate (as defined) plus 4.75% during the
continuance of any event of default thereunder.
F-14The
Senior Credit Facility contains requirements relating to maintaining minimum
excess availability at all times and minimum monthly levels of earnings before
income taxes and depreciation and amortization (as defined) based on the most
recently ended trailing three month period. In addition, the Senior Credit
Facility contains restrictions on capital expenditures, incurrence of
indebtedness, mergers and acquisitions, distributions and transfers and sales of
assets. The Senior Credit Facility also contains requirements related to weekly
and monthly collateral reporting.

*Junior
Credit Facility*. The
Company’s Junior Credit Facility (the “Junior Credit Facility”) is, by its
terms, expressly subordinated only to the Senior Credit Facility, and is secured
by certain specified assets and by a second priority lien and security interest
in substantially all of the Company’s other assets. As amended, the Junior
Credit Facility contains requirements for the maintenance of certain financial
covenants. It also imposes restriction on capital expenditures, incurrence of
indebtedness, mergers and acquisitions, distributions and transfers and sales of
assets.

Contrarian
Funds, LLC (“Contrarian”) purchased all of the outstanding debt of the Junior
Credit facility in a series of transactions during the second half of 2003. As
part of its purchase, Contrarian also purchased warrants for shares of the
Company’s common stock, which were subsequently exchanged for shares of the
Company’s common stock as described in further detail below and in Note 7. In
November 2003, Harbourside Investments, LLLP (“Harbourside”) purchased 44.286%
of the subordinated debt and warrants from Contrarian.(See Note 7
below).

As
described in further detail below under the heading “2003 and 2004 Amendments
and Restructuring” in February 2004, Contrarian and Harbourside finalized the
conversion of approximately $7.0 million in subordinated debt for common stock
of the Company. In connection with this purchase and restructuring of the
Company’s debt, the Junior Credit Facility was amended to, among other things,
extend its maturity date and bear interest at an effective blended rate of
14.0%.

In May
2004 the Company completed the sale of 480,000 shares of its common stock at a
price of $9.00 per share to a small group of unaffiliated private investors. The
proceeds of this sale, together with additional borrowings under the Senior
Credit Facility, were used to retire approximately $5.4 million principal amount
of the Junior Credit Facility and approximately $350,000 of accrued interest on
such debt. The Company’s remaining Junior Credit Facility obligations consist of
approximately $4.2 million principal amount bearing interest at an annual rate
of 9.0%.

In
November 2004, the Junior Credit Facility was amended to extend its maturity
date to January 1, 2006.

*Maturity
of Credit Facilities*. The
Senior Credit Facility is scheduled to mature in July 2005, and the Junior
Credit Facility matures in January 2006. The Company will be required to repay,
refinance or extend the maturity dates of these Facilities when they mature. The
Company has been granted an option, exercisable through July 10, 2005, to extend
the maturity date of the Senior Credit Facility until July 2006, but there can
be no assurance that the Company will be able to repay, refinance or further
amend either of these Facilities when they finally mature. The Company currently
is engaged in negotiations that would result in a longer term senior credit
facility, but there can be no assurance that the Company will be able to
complete any such transaction on satisfactory terms, if at all.

*Interest
Rate Sensitivity*. Because
of the amount of obligations outstanding under the Senior and Junior Credit
Facilities and the connection of the interest rate under each Facility
(including the default rates) to the prime rate, an increase in the prime rate
could have a significant effect on the Company’s ability to satisfy its
obligations under the Facilities and increase its interest expense
significantly. Therefore, the Company’s liquidity and access to capital
resources could be further affected by increasing interest rates.

*Prior
Default of Credit Facilities*. The
Company’s failure to repay all outstanding principal, interest and any other
amounts due and owing under the Junior Credit Facility at its original July 23,
2003 maturity date constituted an event of default under the Junior Credit
Facility and also triggered an event of default under the cross default
provisions of the Senior Credit Facility . Additionally, the Company was in
default of the EBITDA covenant under the Junior Credit Facility only for the
first quarter of calendar 2003. The Company was also in default under both the
Senior and Junior Credit Facility as a result of the “going concern” explanatory
paragraph included in the report of our prior auditor (which going concern
qualification was removed, and an unqualified report subsequently delivered, in
connection with the recent re-audit of the Company’s 2002 financial statements
by its current auditor), as well as the failure to file its Annual Report for
the fiscal year ended December 31, 2002 prior to April 30, 2003.
F-15Pursuant
to the terms of the intercreditor agreement between the then-existing senior and
junior lenders, the junior lender agent and the junior lenders were prevented
from taking any enforcement action or exercising any remedies against the
Company, its subsidiaries or its respective assets as a result of such events of
default during a standstill period. On July 29, 2003, the junior lender agent
gave a notice of enforcement to the senior lender agent based upon the event of
default for failure to repay the outstanding obligations under the Junior Credit
Facility on the Junior Credit Facility’s maturity date. On August 5, 2003, the
senior agent gave a payment blockage notice to the junior agent based upon
certain events of default under the Senior Credit Facility, thereby preventing
the junior agent and junior lenders from receiving any payments from the Company
in respect of the Junior Credit Facility while such blockage notice remains in
effect.

*2003
and 2004 Amendments and Restructuring*. On
October 31, 2003, the Company entered into a forbearance agreement with the
then-existing lenders and the senior lender agent under the Senior Credit
Facility, pursuant to which, among other things, the senior lenders agreed to
forbear from exercising any remedies in respect of the defaults then existing
under the Senior Credit Facility as a result of (i) the failure to timely
deliver financial statements for fiscal year 2002 and the failure to deliver a
report of the Company’s independent certified public accountants which is
unqualified in any respect, as well as the event of default under the Senior
Credit Facility caused by the event of default arising from such failure under
the Junior Credit Facility; (ii) the failure to fulfill certain payment
obligations to the junior lenders under the Junior Credit Facility; and (iii)
the failure to fulfill certain financial covenants in the Junior Credit Facility
for one or more of the quarters ending in 2003, which failure would constitute
an event of default under the Senior Credit Facility. The forbearance period
under the forbearance agreement was to expire on the earlier of (x) December 31,
2003, (y) the occurrence of certain bankruptcy type events in respect of the
Company or any of its subsidiaries, and (z) the failure by the Company or any of
its subsidiaries that are borrower parties under the Senior Credit Facility to
perform the obligations under the Senior Credit Facility or the forbearance
agreement. Under the forbearance agreement, the senior lenders and the senior
lender agent did not waive their rights and remedies with respect to the
existing senior facility defaults, but agreed to forbear from exercising rights
and remedies with respect to the existing senior facility defaults solely during
the forbearance period.

Simultaneous
with entering into the forbearance agreement, William G. Miller, the Chairman of
the Board and Co-Chief Executive Officer of the Company, made a $2.0 million
loan to the Company as a part of the Senior Credit Facility. The loan and Mr.
Miller’s participation in the Senior Credit Facility were effected by the
Seventh Amendment to the credit agreement and a participation agreement between
Mr. Miller and the Senior Credit Facility lenders.

On
December 24, 2003, Mr. Miller increased his previous $2.0 million participation
in the existing Senior Credit Facility by an additional $10.0 million. These
funds, along with additional funds from CIT, an existing senior lender, were
used to satisfy the obligations to two of the other existing senior lenders.
This transaction resulted in CIT and Mr. Miller constituting the senior lenders
to the Company, with CIT holding 62.5% of such loan and Mr. Miller participating
in 37.5% of the commitment. Mr. Miller’s portion of the loan is subordinated to
that of CIT.

In
conjunction with Mr. Miller’s increased participation, the Senior Credit
Facility was restructured and restated as a $15.0 million revolving facility and
$12.0 million and $5.0 million term loans. As a result of this restructuring,
all previously existing defaults under the Senior Credit Facility were waived,
the interest rate was lowered by 2.0% to reflect a non default rate, fees
attributable to RoadOne of $30,000 per month were eliminated, the financial
covenants were substantially relaxed, and availability under the Senior Credit
Facility was increased by approximately $5.0 million. The senior lending group,
consisting of CIT and Mr. Miller, earned fees of $850,000 in connection with the
restructuring, including previously unpaid fees of $300,000 for the earlier
forbearance agreement through December 31, 2003 and $550,000 for the
restructuring of the loans described above. Of these fees, 37.5% ($318,750) were
paid to Mr. Miller and the remainder ($531,250) were paid to CIT. In addition,
the Company will pay additional interest at a rate of 1.8% on Mr. Miller’s
portion of the loan, which is in recognition of the fact that Mr. Miller’s
rights to payments and collateral are subordinate to those of CIT. This
transaction was approved by the Special Committee of the Board, as well as the
full Board of Directors with Mr. Miller abstaining due to his personal interest
in the transaction.
F-16In order
to enter into this restructuring of the Senior Credit Facility, CIT required
that the junior lenders agree to extend the standstill and payment blockage
periods, which were to expire at the end of April 2004, until July 31, 2005,
which is after the July 23, 2005 maturity of the senior debt. The junior
facility lenders were unwilling to extend such standstill and payment blockage
dates without the conversion provisions described above having been committed to
by the Company, subject only to shareholder approval of the conversion by
Harbourside. As a result, the restructuring of the senior debt facility and the
conversion and exchange of subordinated debt and warrants described above were
cross conditioned upon each other and agreements effecting them were entered
into simultaneously on December 24, 2003.

To
effectuate the conversion and exchange of the subordinated debt and warrants,
the Company entered into a Binding Restructuring Agreement with Contrarian and
Harbourside on December 24, 2003. Under this agreement, Contrarian and
Harbourside agreed to an exchange transaction where they would extend the
maturity date of 70.0% of the outstanding principal amount of the junior debt,
approximately $9.75 million, convert the remaining 30.0% of the outstanding
principal, plus all accrued interest and fees, into the Company’s common stock
and convert the warrants into the Company’s common stock. This agreement
contemplated that the conversions would be further documented in separate
exchange agreements and also contemplated registration rights agreements. The
Binding Restructuring Agreement also outlined the terms for amending the Junior
Credit Facility to extend its maturity date to July 31, 2005 (which is after the
July 23, 2005 maturity date of the Senior Credit Facility), to provide for an
interest rate on the remaining debt of Contrarian at 18.0% and the remaining
debt of Harbourside at a reduced rate (which was ultimately agreed to be 9.0%),
to provide for financial covenants that match those of the Senior Credit
Facility and to make other amendments to the Junior Credit Facility consistent
with amendments made to the Senior Credit Facility as it was amended on December
24, 2003. The disparity in the interest rates to be earned by Contrarian and
Harbourside is caused by Contrarian negotiating an interest rate of 18.0% as a
condition to it entering into the Binding Restructuring Agreement, as a result
of which Harbourside agreed to reduce the rate to be received by it to 9.0% so
that the Company would continue to pay an effective blended interest rate of
14.0% on the aggregate of the subordinated debt following the exchange
transactions. At the same time, Contrarian and Harbourside entered into an
agreement with the senior lenders to extend the maturity date of the
subordinated debt that they would continue to hold.

In
January 2004, the Company entered into separate exchange agreements with
Contrarian and Harbourside, a registration rights agreement with Contrarian and
Harbourside and an amendment to the Junior Credit Facility with Contrarian and
Harbourside, all as contemplated in the Binding Restructuring Agreement.
Additional details regarding the specific terms of the exchange agreements can
be found in Note 7 “Related Party Transactions”. Under the amendment to the
Junior Credit Facility, the maturity of the remaining subordinated debt was
extended and the interest rates thereon were altered and the financial covenants
were amended to match those in the Senior Credit Facility, which had been
substantially relaxed in the Company’s favor on December 24, 2003.

Future
maturities of long-term obligations at December 31, 2004 are as follows (in
thousands):

**Continuing
      Operations**
    
    **Discontinued
      Operations**
    
    **Total**2005
    
    $
    2,052
    
    $
    665
    
    $
    2,7172006
    
    
    22,573
    
    
    2,275
    
    
    24,8482007
    
    
    129
    
    
    -
    
    
    1292008
    
    
    135
    
    
    -
    
    
    1352009
    
    
    1,508
    
    
    -
    
    
    1,508Thereafter
    
    
    -
    
    
    -
    
    
    -$
    26,397
    
    $
    2,940
    
    $
    29,337


F-17
**7.**
    **RELATED
      PARTY TRANSACTIONS**

**Subordinated
Debt and Warrant Conversion**

Harbourside
Investments LLLP is a limited liability limited partnership of which several of
the Company’s executive officers and directors are partners. Specifically,
William G. Miller is the general partner of, and controls, Harbourside. Mr.
Miller is the Company’s Chairman of the Board and Co-Chief Executive Officer, as
well as the holder of approximately 16% of the Company’s outstanding common
stock. Mr. Miller, Jeffrey I. Badgley, the Company’s President and Co-Chief
Executive Officer, J. Vincent Mish, the Company’s Executive Vice President and
Chief Financial Officer, and Frank Madonia, the Company’s Executive Vice
President, Secretary and General Counsel, are all limited partners in
Harbourside. In connection with the formation of Harbourside, Mr. Miller made
loans to the other executive officers, the proceeds of which the other executive
officers then contributed to Harbourside. These loans from Mr. Miller to the
other executive officers are secured by pledges of their respective limited
partnership interests to Mr. Miller.

As
partners of Harbourside, each of Messrs. Miller, Badgley, Mish and Madonia
indirectly received shares of common stock in exchange for the subordinated debt
and warrants held by Harbourside. As general partner of Harbourside, Mr. Miller
has sole voting power over the shares of common stock that Harbourside received
in the exchange. This transaction was approved by the Special Committee of the
Board, as well as the full Board of Directors with Messrs. Miller and Badgley
abstaining due to their personal interest in the transaction. The transaction
was subsequently approved by the Company’s shareholders at a meeting on February
12, 2004. Other than the exchange, the Company has not engaged in any
transactions with Harbourside. Neither the Company nor Harbourside currently
intend to engage in any other transactions in the future except as may be
related to Harbourside’s continuing ownership of a portion of the subordinated
debt.

On
November 24, 2003, Harbourside purchased from Contrarian 44.286% of (i) the
Company’s subordinated debt under its Junior Credit Facility and (ii) warrants
to purchase 186,028 shares of the Company’s common stock held by Contrarian.
Contrarian had previously purchased all of the Company’s outstanding
subordinated debt in a series of transactions during the second half of 2003. As
a result of this transaction, Harbourside acquired (x) approximately $6.1
million of the outstanding principal of subordinated debt plus accrued interest
and fees attributable to this outstanding principal and (y) warrants to purchase
an aggregate of 82,382 shares of the Company’s common stock, consisting of
warrants to purchase up to 20,998 shares at an exercise price of $3.48 and
61,384 shares at an exercise price of $3.27. Contrarian retained the remaining
principal outstanding under the Junior Credit Facility, which is approximately
$7.7 million, plus related interest and fees thereon of approximately $1.7
million, and the remaining warrants to purchase 103,646 shares of common
stock.

On
January 14, 2004, the Company entered into an exchange agreement with
Harbourside, pursuant to which it later issued 583,556 shares of the Company’s
common stock upon shareholder approval in exchange for approximately $1.8
million principal amount of, plus approximately $1.3 million of accrued interest
and fees thereon.

Under the
Exchange Agreement, Harbourside retained 70% of the outstanding principal amount
of the subordinated debt that it held and converted the remaining 30% of the
outstanding principal amount of such debt plus all accrued interest and
commitment fees thereunder into shares of the Company’s common stock.
Immediately prior to entering into the Exchange Agreement, Harbourside held
approximately $7.5 million of the Company’s subordinated debt, consisting of
approximately $6.1 million of outstanding principal and approximately $1.3
million of accrued interest and fees. Harbourside continues to hold
approximately $4.3 million principal amount of subordinated debt and converted
approximately $3.2 million of the subordinated debt (30% of $6.1 million
principal amount, plus approximately $1.3 million of accrued interest and fees)
into 548,738 shares of the Company’s common stock. In addition, Harbourside
received 34,818 shares of the Company’s common stock in exchange for the
warrants to purchase 82,382 shares of the Company’s common stock. The Company
paid Harbourside approximately $300,000 in interest expense on the subordinated
holdings.

The
subordinated debt was originally issued pursuant to that certain Amended and
Restated Credit Agreement, dated July 23, 2001, as amended, by and among the
Company and Miller Industries Towing Equipment, Inc., a Delaware corporation and
Bank of America, N.A. in its capacity as a lender, and certain other financial
institutions. This Junior Credit Facility and the notes issued pursuant to it
are subordinate to the Senior Credit Facility which was also
F-18entered
into on July 23, 2001. The subordinated debt had an original aggregate principal
amount of $14.0 million bearing interest at the prime rate plus 6.0% per annum
and at the time of Contrarian’s purchases had an outstanding principal amount of
approximately $13.9 million bearing interest at the default rate of 14% per
annum. The original maturity date of the subordinated debt was July 23, 2003.
The total amount outstanding on the subordinated debt as of January 14, 2004,
including accrued interest and commitment fees, was approximately $16.8 million
with an interest rate of 14% per annum continuing to apply.

As a part
of its purchases of the subordinated debt, Contrarian also purchased warrants,
or the rights to receive warrants, to purchase 186,028 shares of the Company’s
common stock. The Company issued these warrants to the initial lenders under the
Junior Credit Facility pursuant to a Warrant Agreement, dated July 23, 2001, by
and among the Company and the initial lenders. The 186,028 total consists of
warrants issued in July 2002 for the purchase of 47,417 shares of the Company’s
common stock at an exercise price of $3.48 and warrants issued in October 2003
for 138,611 shares of common stock at an exercise price of $3.27. Other than
these transactions relating to the subordinated debt and the warrants, which it
purchased without the Company’s involvement, Contrarian has no relationship with
the Company or Harbourside.

**Senior
Credit Facility**

Simultaneously
with entering into a forbearance agreement on October 31, 2003 with respect to
the Senior Credit Facility, Mr. Miller made a $2.0 million loan to the Company
as a part of the Senior Credit Facility. The loan to the Company and Mr.
Miller’s participation in the Senior Credit Facility were effected by an
amendment to the credit agreement and a participation agreement between Mr.
Miller and the Senior Credit Facility lenders.

On
December 24, 2003, Mr. Miller increased his $2.0 million participation in the
existing Senior Credit Facility by an additional $10.0 million. These funds,
along with additional funds from CIT, were used to satisfy the Company’s
obligations to two of the existing senior lenders with the result being that
CIT, an existing senior lender, and Mr. Miller constituted the senior lenders to
the Company, with CIT holding 62.5% of such loan and Mr. Miller participating in
37.5% of the loan. Mr. Miller’s portion of the loan is subordinated to that of
CIT. The Company paid Mr. Miller approximately $900,000 in interest expense
related to his portion of the senior credit facility.

In
conjunction with Mr. Miller’s increased participation, the Senior Credit
Facility was restructured and restated as a $15.0 million revolving facility and
$12.0 million and $5.0 million term loans. The senior lending group, consisting
of CIT and Mr.Miller, earned fees of $850,000 in connection with the
restructuring, including previously unpaid fees of $300,000 for the earlier
forbearance agreement through December 31, 2003 and $550,000 for the
restructuring of the loans described above. Of these fees, 37.5% ($318,750) were
paid to Mr. Miller and the remainder ($531,250) were paid to CIT. In addition,
the Company will pay additional interest at a rate of 1.8% on Mr. Miller’s
portion of the loan, which is in recognition of the fact that Mr. Miller’s
rights to payments and collateral are subordinate to those of CIT. This
transaction was approved by the Special Committee of the Board, as well as the
full Board of Directors with Mr. Miller abstaining due to his personal interest
in the transaction.

**8.**
    **FINANCIAL
      INSTRUMENTS AND HEDGING ACTIVITIES**

SFAS No.
133 “Accounting for Derivative Instruments and Hedging Activities”, establishes
accounting and reporting standards requiring that every derivative instrument
(including certain derivatives embedded in other contracts) be recorded in the
balance sheet as either an asset or liability measured at its fair value. SFAS
No. 133 requires that changes in the derivatives fair value be recognized
currently in earnings unless specific hedge criteria are met. Special accounting
for qualifying hedges allows a derivative’s gains and losses to offset related
results on the hedged item on the income statement, and requires that the
Company must formally document, designate, and assess the effectiveness of
transactions that receive hedge accounting.

In
October 2001, the Company obtained interest rate swaps as required by terms in
its Senior Credit Facility to hedge exposure to market fluctuations. The
interest rate swaps cover $40.0 million in notional amounts of variable rate
debt and with fixed rates ranging from 2.535% to 3.920%. The swaps expired
annually from October 2002 to October 2004. Because the Company hedges only with
derivatives that have high correlation with the underlying transaction pricing,
changes in derivatives fair values and the underlying pricing largely offset.
Upon expiration of these hedges, the amount recorded in Other Comprehensive Loss
will be reclassified into earnings as interest. In
F-192002, the
borrowing base was converted from LIBOR to prime, which rendered the swap
ineffective as a hedge. Accordingly, concurrent with the conversion, the Company
prematurely terminated the swap in 2002 at a cost of $341,000. The resulting
loss was recorded in Other Comprehensive Loss in 2002 and is being reclassified
to earning as interest expense over the term of the Senior Credit
Facility.

As
described in Note 7, the Junior Credit Facility contains provisions for the
issuance of warrants of up to 0.5% of the outstanding shares of the Company’s
common stock in July 2002 and up to an additional 1.5% in July 2003. The
warrants were valued as of July 2001 based on the estimated relative fair value
using the Black Scholes model with the following assumptions: risk-free rate of
4.9% estimated life of 7 years, 72% volatility and no dividend yield.
Accordingly, the Company recorded a liability and made periodic mark to market
adjustments, which are reflected in the accompanying consolidated statements of
operations in accordance with EITF Issue 00-19, “Accounting for Derivative
Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own
Stock”. At December 31, 2003, the related liability was $349,000 and is included
in accrued liabilities in the accompanying consolidated financial
statements.

As
described in Note 7 - “Related Party Transactions”, in 2004, the warrants were
exchanged for shares of the Company’s common stock and are no longer
outstanding.

**9.**
    **STOCK-BASED
      COMPENSATION PLANS**

In
accordance with the Company’s stock-based compensation plans, the Company may
grant incentive stock options as well as non-qualified and other stock-related
incentives to officers, employees, and non-employee directors of the Company.
Options vest ratably over a two to four-year period beginning on the grant date
and expire ten years from the date of grant. Shares available for granting
options at December 31, 2004, 2003 and 2002 were approximately 0.6 million, 0.5
million and 0.5 million, respectively.

A summary
of the activity of stock options for the years ended December 31, 2004, 2003 and
2002, is presented below (shares in thousands):

**2004**
    
    **2003**
    
    **2002******
    
    
    **Shares**
      **Under**
      **Option**
    
    
    **Weighted**
      **Average**
      **Exercise**
      **Price**
    
    
    **Shares**
      **Under**
      **Option**
    
    
    **Weighted**
      **Average**
      **Exercise**
      **Price**
    
    
    **Shares**
      **Under**
      **Option**
    
    
    **Weighted**
      **Average**
      **Exercise**
      **Price**Outstanding
      at Beginning of Period
    
    
    **745**
    
    **$******
    ******19.90**
    
    
    761
    
    $
    19.58
    
    
    948
    
    $
    19.49Granted
    
    
    **340**
    
    
    **8.31**
    
    
    -
    
    
    -
    
    
    28
    
    
    3.37Exercised
    
    
    **(9**
    **)**
    
    **3.15**
    
    
    (1
    )
    
    3.05
    
    
    -
    
    
    -Forfeited
      and cancelled
    
    
    **(271**
    **)**
    
    **17.99**
    
    
    (15
    )
    
    5.02
    
    
    (215
    )
    
    16.91Outstanding
      at End of Period
    
    
    **805**
    
    **$******
    ******15.46**
    
    
    745
    
    $
    19.90
    
    
    761
    
    $
    19.58Options
      exercisable at year end
    
    
    **455**
    
    **$******
    ******21.12**
    
    
    714
    
    $
    20.64
    
    
    648
    
    $
    22.22Weighted
      average fair value of options granted
    
    
    
    
    **$**
    **3.65**
    
    
    
    
    
    -
    
    
    
    
    $
    1.88

A summary
of options outstanding under the Company’s stock-based compensation plans at
December 31, 2004 is presented below (shares in thousands):

**Exercise
      Price Range**
    
    
    **Shares
      Under Option**
    
    
    **Weighted**
      **Average**
      **Exercise**
      **Price
      of**
      **Options**
      **Outstanding**
    
    
    **Weighted**
      **Average**
      **Remaining**
      **Life**
    
    
    **Options**
      **Exercisable**
    
    
    **Weighted**
      **Average**
      **Exercise**
      **Price
      of**
      **Shares**
      **Exercisable**$
    3.05
    -
    $
    3.37
    
    
    87
    
    $
    3.15
    
    
    7.0
    
    
    74
    
    $
    3.174.60
    -
    
    5.63
    
    
    37
    
    
    4.62
    
    
    6.5
    
    
    37
    
    
    4.627.01
    -
    
    8.31
    
    
    370
    
    
    8.19
    
    
    8.9
    
    
    33
    
    
    7.0210.62
    -
    
    11.67
    
    
    41
    
    
    10.94
    
    
    4.7
    
    
    41
    
    
    10.9417.50
    -
    
    22.50
    
    
    152
    
    
    19.36
    
    
    1.5
    
    
    152
    
    
    19.3628.74
    -
    
    38.20
    
    
    57
    
    
    34.50
    
    
    2.7
    
    
    57
    
    
    34.5043.95
    -
    
    63.55
    
    
    42
    
    
    53.38
    
    
    1.7
    
    
    42
    
    
    53.3870.00
    -
    
    82.50
    
    
    19
    
    
    73.28
    
    
    2.4
    
    
    19
    
    
    73.28Total
    
    
    805
    
    $
    15.46
    
    
    6.0
    
    
    455
    
    $
    21.12
F-20
**10.**
    **COMMITMENTS
      AND CONTINGENCIES**

*Commitments*

The
Company has entered into various operating leases for buildings, office
equipment, and trucks. Rental expense under these leases for continuing
operations was $850,000, $1,928,000 and $2,729,000 in 2004, 2003 and 2002,
respectively. Rental expense under these leases for discontinued operations was
$551,000, $2,011,000 and $8,153,000 in 2004, 2003 and 2002,
respectively.

At
December 31, 2004, future minimum lease payments under non-cancelable operating
leases for the next five fiscal years are as follows (in
thousands):

**Continuing
      Operations**
    
    **Discontinued
      Operations**
    
    **Total**2005
    
    $
    678
    
    $
    246
    
    $
    9242006
    
    
    462
    
    
    220
    
    
    6822007
    
    
    294
    
    
    168
    
    
    4622008
    
    
    51
    
    
    98
    
    
    1492009
    
    
    20
    
    
    -
    
    
    20Thereafter
    
    
    93
    
    
    -
    
    
    93

*Contingencies*

The
Company is, from time to time, a party to litigation arising in the normal
course of its business. Litigation is subject to various inherent uncertainties,
and it is possible that some of these matters could be resolved unfavorably to
the Company, which could result in substantial damages against the Company. The
Company has established accruals for matters that are probable and reasonably
estimable and maintains product liability and other insurance that management
believes to be adequate. Management believes that any liability that may
ultimately result from the resolution of these matters in excess of available
insurance coverage and accruals will not have a material adverse effect on the
consolidated financial position or results of operations of the
Company.

**11.**
    **INCOME
      TAXES**

Deferred
tax assets and liabilities are determined based on the differences between the
financial and tax basis of existing assets and liabilities using the currently
enacted tax rates in effect for the year in which the differences are expected
to reverse.

The
(benefit) provision for income taxes on income from continuing operations
consisted of the following in 2004, 2003 and 2002, (in thousands):

**2004**
    
    **2003**
    
    **2002**Current:Federal
    
    **$**
    **-**
    
    $
    839
    
    $
    (256
    )State
    
    
    **317**
    
    
    246
    
    
    297Foreign
    
    
    **423**
    
    
    131
    
    
    533**740**
    
    
    1,216
    
    
    574Deferred:Federal
    
    
    **-**
    
    
    (290
    )
    
    6,620State
    
    
    **-**
    
    
    288
    
    
    (177
    )Foreign
    
    
    **-**
    
    
    2
    
    
    191****
    
    
    
    
    
    -
    
    
    6,634**$**************
    **************740**
    
    $
    1,216
    
    $
    7,208


F-21
The
principal differences between the federal statutory tax rate and the income
expense (benefit) from continuing operations in 2004, 2003 and
2002:

**2004**
    
    **2003**
    
    **2002**Federal
      statutory tax rate
    
    
    **34.0**
    **%**
    
    34.0
    %
    
    34.0
    %State
      taxes, net of federal tax benefit
    
    
    **4.0**
    **%**
    
    4.0
    %
    
    5.5
    %Change
      in deferred tax asset valuation allowance
    
    
    **(34.0**
    **%)**
    
    0.0
    %
    
    26.1
    %Excess
      of foreign tax over US tax on foreign income
    
    
    **4.9**
    **%**
    
    0.0
    %
    
    5.0
    %Other
    
    
    **0.7**
    **%**
    
    (1.0
    %)
    
    (0.6
    )%Effective
      tax rate
    
    
    **9.6**
    **%**
    
    37.0
    %
    
    70.0
    %

Deferred
income tax assets and liabilities at December 31, 2004, 2003 and 2002 reflect
the impact of temporary differences between the amounts of assets and
liabilities for financial reporting and income tax reporting purposes. Temporary
differences and carry forwards which give rise to deferred tax assets and
liabilities at December 31, 2004, 2003 and 2002 are as follows (in
thousands):

**2004**
    
    **2003**
    
    **2002**Deferred
      tax assets:Allowance
      for doubtful accounts
    
    **$******
    ******423**
    
    $
    377
    
    $
    305Accruals
      and reserves
    
    
    **1,496**
    
    
    1,463
    
    
    1,326Federal
      net operating loss carryforward
    
    
    **14,146**
    
    
    10,078
    
    
    8,118Deductible
      goodwill and impairment charges
    
    
    **(18**
    **)**
    
    (22
    )
    
    9,391Other
    
    
    **-**
    
    
    1,957
    
    
    272Total
      deferred tax assets
    
    
    **16,047**
    
    
    13,853
    
    
    19,412Less
      valuation allowance
    
    
    **(14,834**
    **)**
    
    (9,001
    )
    
    (13,601
    )Net
      deferred tax asset
    
    
    **1,213**
    
    
    4,852
    
    
    5,811Deferred
      tax liabilities:Property,
      plant, and equipment
    
    
    **1,213**
    
    
    4,852
    
    
    5,811Total
      deferred tax liabilities
    
    
    **1,213**
    
    
    4,852
    
    
    5,811Net
      deferred tax asset
    
    **$**
    -
    
    $
    -
    
    $
    -

Included
in the Company’s noncurrent assets of discontinued operations at December 31,
2004 and 2003, is a net noncurrent deferred tax asset of $1.4 million and $4.1
million, respectively, relating primarily to tax deductible goodwill and
reserves that are not deductible for tax purposes until paid. In addition, the
Company’s noncurrent liabilities of discontinued operations at December 31, 2004
and 2003, include noncurrent deferred tax liability of $0.0 million and $0.2
million, respectively, related primarily to differences in the book and tax
bases of fixed assets. The net deferred tax assets of the discontinued
operations of $1.4 and $4.3 million have a full valuation
allowance.

As of
December 31, 2004, the Company had federal net operating loss carryforwards of
approximately $37.2 million which will expire between 2005 and 2024. While the
majority of these loss carryforwards are associated with the Company’s
discontinued operations, the Company has classified the related deferred tax
asset and valuation allowance as a component of continuing operations since it
believes it will be able to retain these tax attributes. In addition, the
Company had charitable contributions of $0.3 million that may be carried forward
through 2007 and an AMT credit carryforward of approximately $0.2 million, which
may be carried forward indefinitely.

The
valuation allowance reflects the Company’s recognition that continuing losses
from operations and certain liquidity matters indicate that it is unclear
whether certain future tax benefits will be realized as a result of future
taxable income. At December 31, 2004, 2003 and 2002, the Company recorded a full
valuation allowance against its net deferred tax asset from continuing and
discontinuing operations totaling approximately $16.2 million, $13.3 million and
$18.0 million, respectively.
F-22As of
December 31, 2004, the Company has state net operating loss carryforwards of
approximately $97.0 million. As the Company believes that realization of the
benefit of these state losses is remote because the Company no longer has
operations in many of these states, it has not recorded deferred tax assets
associated with these losses.

The
Company received federal tax refunds of approximately $8.8 million during 2002,
which was used to reduce the RoadOne revolver and cured the over-advance
position that existed at that time.

**12.**
    **PREFERRED
      STOCK**

The
Company has authorized 5,000,000 shares of undesignated preferred stock which
can be issued in one or more series. The terms, price, and conditions of the
preferred shares will be set by the board of directors. No shares have been
issued.

**13.**
    **EMPLOYEE
      BENEFIT PLANS**

During
1996, the Company established a contributory retirement plan for all full-time
employees with at least 90 days of service. Effective January 1, 1999, the
Company split the plan into two identical plans by operating segment. As a
result of the Company’s decision to dispose of its towing services operations
the two separate plans were combined to form a consolidated plan effective
January 1, 2003. These plans are designed to provide tax-deferred income to the
Company’s employees in accordance with the provisions of Section 401 (k) of the
Internal Revenue Code.

These
plans provide that each participant may contribute up to 15% of his or her
salary. The Company matches 33.33% of the first 3% of participant contributions.
Matching contributions vest over the first five years of employment. Company
contributions to the plans were not significant in 2004, 2003 and
2002.

**14.**
    **GEOGRAPHIC
      AND CUSTOMER INFORMATION**
Net sales
and long-lived assets (property, plant and equipment and goodwill and intangible
assets) by region was as follows (revenue is attributed to regions based on the
locations of customers) (in thousands):

**2004**
    
    **2003**
    
    **2002****Net
      Sales**
    
    **Long-Lived
      Assets**
    
    **Net
      Sales**
    
    **Long-Lived
      Assets**
    
    **Net
      Sales**
    
    **Long-Lived
      Assets**North
      America
    
    $
    196,902
    
    $
    28,026
    
    $
    171,627
    
    $
    30,086
    
    $
    199,620
    
    $
    32,341Foreign
    
    
    39,406
    
    
    2,607
    
    
    34,369
    
    
    2,902
    
    
    31,883
    
    
    2,934$
    236,308
    
    $
    30,633
    
    $
    205,996
    
    $
    32,988
    
    $
    231,503
    
    $
    35,275

No single
customer accounted for 10% or more of consolidated net sales in 2004, 2003 or
2002.

**15.**
    **QUARTERLY
      FINANCIAL INFORMATION (UNAUDITED)**

The
following is a summary of the unaudited quarterly financial information for the
years ended December 31, 2004 and 2003 (in thousands, except per share
data):

**Net
      Sales**
    
    **Operating**
      **Income**
      **(Loss)**
    
    **Loss
      From**
      **Discontinued**
      **Operations**
    
    **Net
      Income**
      **(Loss)(a)**
    
    **Basic
      Income**
      **(Loss)
      Per**
      **Share**
    
    **Diluted**
      **Income**
      **(Loss)
      Per**
      **Share***2004*First
      Quarter
    
    $46,158
    
    $2,329
    
    $(488)
    
    $612
    
    $0.06
    
    $0.06Second
      Quarter
    
    59,648
    
    3,327
    
    (322)
    
    1,753
    
    0.16
    
    0.16Third
      Quarter
    
    63,300
    
    3,376
    
    (471)
    
    1,522
    
    0.14
    
    0.14Fourth
      Quarter
    
    67,202
    
    3,351
    
    (230)
    
    1,588
    
    0.14
    
    0.14Total
    
    $236,308
    
    $12,383
    
    $(1,511)
    
    $5,475
    
    $0.50
    
    $0.50*2003*First
      Quarter
    
    $
    47,893
    
    $
    3,310
    
    $
    (2,302
    )
    $
    (559
    )
    $
    (0.06
    )
    $
    (0.06
    )Second
      Quarter
    
    
    57,962
    
    
    3,217
    
    
    (2,136
    )
    
    (493
    )
    
    (0.05
    )
    
    (0.05
    )Third
      Quarter
    
    
    50,321
    
    
    1,439
    
    
    (4,845
    )
    
    (6,835)(b
    )
    
    (0.74
    )
    
    (0.74
    )Fourth
      Quarter
    
    
    49,820
    
    
    1,611
    
    
    (6,940
    )
    
    (6,266)(b
    )
    
    (0.67
    )
    
    (0.67
    )Total
    
    $
    205,996
    
    $
    9,577
    
    $
    (16,223
    )
    $
    (14,153
    )
    $
    (1.52
    )
    $
    (1.52
    )

(a)The
income tax provision (benefit) has been allocated by quarter based on the
effective rate for the twelve months ended December 31, 2004 and
2003.

(b)The
results of operations reflect asset impairments and other special charges as
discussed in Notes 4 and 5.
F-23**MILLER
INDUSTRIES, INC. AND SUBSIDIARIES**

**SCHEDULE
II -VALUATION AND QUALIFYING ACCOUNTS**

**Balance
      at**
      **Beginning**
      **of
      Period**
    
    **Charged
      to**
      **Expenses**
    
    **Charged
      to**
      **Other**
    
    **Accounts**
      **Written
      Off**
    
    **Balance
      at**
      **End
      of**
      **Period****(In
      Thousands)**Year
      ended December 31, 2002:Deduction
      from asset accounts:Allowance
      for doubtful accounts
    
    $
    576
    
    
    563
    
    
    -
    
    
    (334
    )
    $
    805Year
      ended December 31, 2003:Deduction
      from asset accounts:Allowance
      for doubtful accounts
    
    $
    805
    
    
    492
    
    
    -
    
    
    (235
    )
    $
    1,062Year
      ended December 31, 2004:Deduction
      from asset accounts:Allowance
      for doubtful accounts
    
    $
    1,062
    
    
    567
    
    
    -
    
    
    (513
    )
    $
    1,116



**Balance
      at**
      **Beginning
      of**
      **Period**
    
    **Charged
      to**
      **Expense**
    
    **Claims**
    
    **Balance
      at**
      **End
      of Period****(In
      Thousands)**Year
      ended December 31, 2002:Product
      Warranty Reserve:
    
    $
    926
    
    
    1,489
    
    
    (1,861
    )
    $
    554Year
      ended December 31, 2003:Product
      Warranty Reserve:
    
    $
    554
    
    
    1,547
    
    
    (1,462
    )
    $
    639Year
      ended December 31, 2004:Product
      Warranty Reserve:
    
    $
    639
    
    
    1,520
    
    
    (1,494
    )
    $
    665
S-1
**Balance
      at**
      **Beginning
      of**
      **Period**
    
    **Additions**
      **(Reductions)**
    
    **Balance
      at**
      **End
      of**
      **Period****(In
      Thousands)**Year
      ended December 31, 2002:Deferred
      Tax Valuation Allowance:
    
    $
    6,011
    
    
    12,021
    
    $
    18,032Year
      ended December 31, 2003:Deferred
      Tax Valuation Allowance:
    
    $
    18,032
    
    
    (4,733
    )
    $
    13,299Year
      ended December 31, 2004:Deferred
      Tax Valuation Allowance:
    
    $
    13,299
    
    
    2,889
    
    $
    16,188

Note:
    The
      Allowance for Doubtful Accounts and Product Warranty Reserve tables above
      reflect activity for continuing operations for the years ended December
      31, 2004, 2003 and 2002. The Deferred Tax Valuation Allowance table
      reflects consolidated operations for all periods
presented.




S-2
 **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, on the 2 nd day of
May, 2005.
   **MILLER
      INDUSTRIES, INC.**By:
    /s/  Jeffrey I.
    BadgleyJeffrey
      I. Badgley
      President,
      Co-Chief Executive Officer and
Director
 ****
    
  
 
 **EXHIBIT
INDEX**
  **Exhibit
      Number**
    
    **Description**23.1
    
    Consent
      of Joseph Decosimo and Company, PLLC31.1
    
    Certification
      Pursuant to Rules 13a-14(a)/15d-14(a) by Co-Chief Executive
      Officer31.2
    
    Certification
      Pursuant to Rules 13a-14(a)/15d-14(a) by Co-Chief Executive
      Officer31.3
    
    Certification
      Pursuant to Rules 13a-14(a)/15d-14(a) by Chief Financial
      Officer