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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

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Form 10-Q

(Mark one)

|  |        |                                                                                         |
|--|--------|-----------------------------------------------------------------------------------------|
|  |   | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |

|  |        |                                                        |
|--|--------|--------------------------------------------------------|
|  |   | For the quarterly period ended June 30, 2007 |

OR

|  |        |                                                                                          |
|--|--------|------------------------------------------------------------------------------------------|
|  |   | Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |

|  |        |                                                                                                                                                                                                                                                                                                                                                                                                             |
|--|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  |   | For the transition period from                              to                                  |

Commission File Number 333-118086

AMES TRUE TEMPER, INC.

(Exact name of registrant as specified in its charter)

|                                                               |  |  |                                     |
|---------------------------------------------------------------|--|--|-------------------------------------|
| Delaware                                                      |  |  | 22-2335400                          |
| (State or other jurisdiction ofincorporation or organization) |  |  | (I.R.S. EmployerIdentification No.) |
| 465 Railroad Avenue, Camp Hill, Pennsylvania                  |  |  | 17011                               |
| (Address of principal executive offices)                      |  |  | (Zip Code)                          |

(717) 737-1500

(Registrant’s telephone number, including area code)

NOT APPLICABLE

(Former name, former address and former fiscal year, if changed since last report)

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 a period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes         No 

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of ‘‘accelerated filer and large accelerated filer’’ in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer                     Accelerated filer                     Non-accelerated filer 

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes         No 

As of August 14, 2007 the Registrant had 1,000 shares of its common stock, $1.00 par value, outstanding.

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ATT HOLDING CO.

TABLE OF CONTENTS

|                                                      |  |  |                                                                                                                                           |  |  |          |  |        |  |
|------------------------------------------------------|--|--|-------------------------------------------------------------------------------------------------------------------------------------------|--|--|----------|--|--------|--|
|                                                 |  |  |                                                                                                                                      |  |  | Page No. |
| PART I.    FINANCIAL INFORMATION |
| Item 1.                                              |  |  | Financial Statements (unaudited):                                                                                                         |  |  |          |  |   |  |
|                                                 |  |  | Condensed Consolidated Balance Sheets as of June 30, 2007 and September 30, 2006                                      |  |  |          |  | 1      |  |
|                                                 |  |  | Condensed Consolidated Statements of Operations for the thirteen week periods ended June 30, 2007 and July 1, 2006    |  |  |          |  | 2      |  |
|                                                 |  |  | Condensed Consolidated Statements of Operations for the thirty-nine week periods ended June 30, 2007 and July 1, 2006 |  |  |          |  | 3      |  |
|                                                 |  |  | Condensed Consolidated Statements of Cash Flows for the thirty-nine week periods ended June 30, 2007 and July 1, 2006 |  |  |          |  | 4      |  |
|                                                 |  |  | Notes to Condensed Consolidated Financial Statements                                                                                      |  |  |          |  | 5      |  |
| Item 2.                                              |  |  | Management’s Discussion and Analysis of Financial Condition and Results of Operations                                               |  |  |          |  | 19     |  |
| Item 3.                                              |  |  | Quantitative and Qualitative Disclosures About Market Risk                                                                                |  |  |          |  | 27     |  |
| Item 4.                                              |  |  | Controls and Procedures                                                                                                                   |  |  |          |  | 28     |  |
| PART II. OTHER INFORMATION                           |
| Item 1.                                              |  |  | Legal Proceedings                                                                                                                         |  |  |          |  | 29     |  |
| Item 1A.                                             |  |  | Risk Factors                                                                                                                              |  |  |          |  | 29     |  |
| Item 2.                                              |  |  | Unregistered Sales of Equity Securities and Use of Proceeds                                                                               |  |  |          |  | 29     |  |
| Item 3.                                              |  |  | Defaults Upon Senior Securities                                                                                                           |  |  |          |  | 29     |  |
| Item 4.                                              |  |  | Submission of Matters to a Vote of Security-Holders                                                                                       |  |  |          |  | 29     |  |
| Item 5.                                              |  |  | Other Information                                                                                                                         |  |  |          |  | 29     |  |
| Item 6.                                              |  |  | Exhibits                                                                                                                                  |  |  |          |  | 29     |  |
|                                                 |  |  | Signatures                                                                                                                                |  |  |          |  | 30     |  |

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Table of Contents

PART I.    FINANCIAL INFORMATION

Item 1.    Financial Statements

ATT Holding Co. Condensed Consolidated Balance Sheets(In Thousands)

(Unaudited)

|                                                   |  |  |              |   |          |                    |  |  |  |   |          |         |
|---------------------------------------------------|--|--|--------------|---|----------|--------------------|--|--|--|---|----------|---------|
|                                              |  |  | June 30,2007 |   |          | September 30, 2006 |
| Assets                                            |  |  |              |   |     |                    |  |  |  |   |     |         |
| Current assets:                                   |  |  |              |   |     |                    |  |  |  |   |     |         |
| Cash and cash equivalents                         |  |  |              | $ | 2,806    |                    |  |  |  | $ | 5,638    |         |
| Restricted cash                                   |  |  |              |   | —  |                    |  |  |  |   | 2,081    |         |
| Trade receivables, net                            |  |  |              |   | 100,006  |                    |  |  |  |   | 66,418   |         |
| Inventories                                       |  |  |              |   | 112,008  |                    |  |  |  |   | 141,239  |         |
| Deferred income taxes                             |  |  |              |   | 6,696    |                    |  |  |  |   | 8,521    |         |
| Prepaid expenses and other current assets         |  |  |              |   | 6,387    |                    |  |  |  |   | 6,673    |         |
| Total current assets                              |  |  |              |   | 227,903  |                    |  |  |  |   | 230,570  |         |
| Property, plant and equipment, net                |  |  |              |   | 67,305   |                    |  |  |  |   | 72,680   |         |
| Intangibles, net                                  |  |  |              |   | 77,668   |                    |  |  |  |   | 78,450   |         |
| Goodwill                                          |  |  |              |   | 58,888   |                    |  |  |  |   | 58,359   |         |
| Other noncurrent assets                           |  |  |              |   | 13,468   |                    |  |  |  |   | 15,720   |         |
| Total assets                                      |  |  |              | $ | 445,232  |                    |  |  |  | $ | 455,779  |         |
| Liabilities and stockholders’ deficit       |  |  |              |   |     |                    |  |  |  |   |     |         |
| Current liabilities:                              |  |  |              |   |     |                    |  |  |  |   |     |         |
| Trade accounts payable                            |  |  |              | $ | 36,196   |                    |  |  |  | $ | 39,773   |         |
| Accrued interest payable                          |  |  |              |   | 10,260   |                    |  |  |  |   | 7,325    |         |
| Accrued expenses and other current liabilities    |  |  |              |   | 24,512   |                    |  |  |  |   | 29,944   |         |
| Revolving loan                                    |  |  |              |   | 67,099   |                    |  |  |  |   | 66,608   |         |
| Current portion of long-term debt                 |  |  |              |   | 541      |                    |  |  |  |   | 715      |         |
| Total current liabilities                         |  |  |              |   | 138,608  |                    |  |  |  |   | 144,365  |         |
| Deferred income taxes                             |  |  |              |   | 28,244   |                    |  |  |  |   | 26,325   |         |
| Long-term debt                                    |  |  |              |   | 300,700  |                    |  |  |  |   | 301,077  |         |
| Accrued retirement benefits                       |  |  |              |   | 7,362    |                    |  |  |  |   | 7,812    |         |
| Other liabilities                                 |  |  |              |   | 7,251    |                    |  |  |  |   | 6,927    |         |
| Total liabilities                                 |  |  |              |   | 482,165  |                    |  |  |  |   | 486,506  |         |
| Commitments and contingencies                     |  |  |              |   |     |                    |  |  |  |   |     |         |
| Stockholders’ deficit:                      |  |  |              |   |     |                    |  |  |  |   |     |         |
| Preferred stock-Series A                          |  |  |              |   | —  |                    |  |  |  |   | —  |         |
| Common stock-Class A                              |  |  |              |   | —  |                    |  |  |  |   | —  |         |
| Common stock-Class B                              |  |  |              |   | —  |                    |  |  |  |   | —  |         |
| Additional paid-in capital                        |  |  |              |   | 110,500  |                    |  |  |  |   | 110,500  |         |
| Predecessor basis adjustment                      |  |  |              |   | (13,539  | )             |  |  |  |   | (13,539  | )  |
| Accumulated deficit                               |  |  |              |   | (146,005 | )             |  |  |  |   | (137,597 | )  |
| Accumulated other comprehensive income            |  |  |              |   | 12,111   |                    |  |  |  |   | 9,909    |         |
| Total stockholders’ deficit                 |  |  |              |   | (36,933  | )             |  |  |  |   | (30,727  | )  |
| Total liabilities and stockholders’ deficit |  |  |              | $ | 445,232  |                    |  |  |  | $ | 455,779  |         |

See accompanying notes.

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Table of Contents

ATT Holding Co. Condensed Consolidated Statements of Operations(In Thousands)

(Unaudited)

|                                              |  |  |                           |   |         |             |  |  |  |   |         |         |
|----------------------------------------------|--|--|---------------------------|---|---------|-------------|--|--|--|---|---------|---------|
|                                         |  |  | Thirteen WeekPeriod Ended |
|                                         |  |  | June 30,2007              |   |         | July 1,2006 |
| Net sales                                    |  |  |                           | $ | 156,889 |             |  |  |  | $ | 163,331 |         |
| Cost of goods sold                           |  |  |                           |   | 118,744 |             |  |  |  |   | 119,422 |         |
| Gross profit                                 |  |  |                           |   | 38,145  |             |  |  |  |   | 43,909  |         |
| Selling, general and administrative expenses |  |  |                           |   | 25,602  |             |  |  |  |   | 30,006  |         |
| Loss on disposal of fixed assets             |  |  |                           |   | 583     |             |  |  |  |   | 6       |         |
| Amortization of intangible assets            |  |  |                           |   | 375     |             |  |  |  |   | 450     |         |
| Operating income                             |  |  |                           |   | 11,585  |             |  |  |  |   | 13,447  |         |
| Interest expense                             |  |  |                           |   | 9,279   |             |  |  |  |   | 9,411   |         |
| Other income                                 |  |  |                           |   | (619    | )      |  |  |  |   | (5,866  | )  |
| Income before income taxes                   |  |  |                           |   | 2,925   |             |  |  |  |   | 9,902   |         |
| Income tax expense                           |  |  |                           |   | 1,215   |             |  |  |  |   | 2,330   |         |
| Net income                                   |  |  |                           | $ | 1,710   |             |  |  |  | $ | 7,572   |         |

See accompanying notes.

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Table of Contents

ATT Holding Co. Condensed Consolidated Statements of Operations(In Thousands)

(Unaudited)

|                                              |  |  |                              |   |         |              |  |  |  |   |         |         |
|----------------------------------------------|--|--|------------------------------|---|---------|--------------|--|--|--|---|---------|---------|
|                                         |  |  | Thirty-Nine WeekPeriod Ended |
|                                         |  |  | June 30, 2007                |   |         | July 1, 2006 |
| Net sales                                    |  |  |                              | $ | 415,866 |              |  |  |  | $ | 385,952 |         |
| Cost of goods sold                           |  |  |                              |   | 312,806 |              |  |  |  |   | 285,615 |         |
| Gross profit                                 |  |  |                              |   | 103,060 |              |  |  |  |   | 100,337 |         |
| Selling, general and administrative expenses |  |  |                              |   | 75,546  |              |  |  |  |   | 73,564  |         |
| Loss (gain) on disposal of fixed assets      |  |  |                              |   | 1,212   |              |  |  |  |   | (493    | )  |
| Amortization of intangible assets            |  |  |                              |   | 1,120   |              |  |  |  |   | 1,347   |         |
| Operating income                             |  |  |                              |   | 25,182  |              |  |  |  |   | 25,919  |         |
| Interest expense                             |  |  |                              |   | 27,411  |              |  |  |  |   | 24,692  |         |
| Other income                                 |  |  |                              |   | (382    | )       |  |  |  |   | (5,735  | )  |
| (Loss) income before income taxes            |  |  |                              |   | (1,847  | )       |  |  |  |   | 6,962   |         |
| Income tax expense                           |  |  |                              |   | 6,561   |              |  |  |  |   | 1,438   |         |
| Net (loss) income                            |  |  |                              | $ | (8,408  | )       |  |  |  | $ | 5,524   |         |

See accompanying notes.

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Table of Contents

ATT Holding Co. Condensed Consolidated Statements of Cash Flows(In Thousands)

(Unaudited)

|                                                                                                    |  |  |                              |   |         |             |  |  |  |   |         |         |
|----------------------------------------------------------------------------------------------------|--|--|------------------------------|---|---------|-------------|--|--|--|---|---------|---------|
|                                                                                               |  |  | Thirty-Nine WeekPeriod Ended |
|                                                                                               |  |  | June 30,2007                 |   |         | July 1,2006 |
| Operating activities                                                                               |  |  |                              |   |    |             |  |  |  |   |    |         |
| Net (loss) income                                                                                  |  |  |                              | $ | (8,408  | )      |  |  |  | $ | 5,524   |         |
| Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities: |  |  |                              |   |    |             |  |  |  |   |    |         |
| Depreciation expense                                                                               |  |  |                              |   | 12,175  |             |  |  |  |   | 8,654   |         |
| Amortization of intangible assets                                                                  |  |  |                              |   | 1,120   |             |  |  |  |   | 1,347   |         |
| Amortization of loan fees                                                                          |  |  |                              |   | 1,866   |             |  |  |  |   | 1,812   |         |
| Provision (benefit) for deferred taxes                                                             |  |  |                              |   | 3,773   |             |  |  |  |   | (4,511  | )  |
| Reduction of allowance for bad debts                                                               |  |  |                              |   | (191    | )      |  |  |  |   | (56     | )  |
| Noncash interest expense                                                                           |  |  |                              |   | 257     |             |  |  |  |   | 196     |         |
| Amortization of bond discount                                                                      |  |  |                              |   | 81      |             |  |  |  |   | 80      |         |
| Loss (gain) on sale of fixed assets                                                                |  |  |                              |   | 1,212   |             |  |  |  |   | (493    | )  |
| Changes in assets and liabilities:                                                                 |  |  |                              |   |    |             |  |  |  |   |    |         |
| Trade receivables                                                                                  |  |  |                              |   | (32,910 | )      |  |  |  |   | (41,125 | )  |
| Inventories                                                                                        |  |  |                              |   | 30,066  |             |  |  |  |   | (21,088 | )  |
| Prepaid expenses and other assets                                                                  |  |  |                              |   | 572     |             |  |  |  |   | 1,821   |         |
| Accounts payable                                                                                   |  |  |                              |   | (3,812  | )      |  |  |  |   | 10,470  |         |
| Accrued expenses and other liabilities                                                             |  |  |                              |   | (3,029  | )      |  |  |  |   | 10,267  |         |
| Net cash provided by (used in) operating activities                                                |  |  |                              |   | 2,772   |             |  |  |  |   | (27,102 | )  |
| Investing activities                                                                               |  |  |                              |   |    |             |  |  |  |   |    |         |
| Cash paid for property, plant and equipment                                                        |  |  |                              |   | (9,015  | )      |  |  |  |   | (10,873 | )  |
| Acquisition of businesses, net of cash received                                                    |  |  |                              |   | — |             |  |  |  |   | (53,073 | )  |
| Release of restricted cash held in escrow                                                          |  |  |                              |   | 2,081   |             |  |  |  |   | — |         |
| Proceeds from sale of fixed assets                                                                 |  |  |                              |   | 1,666   |             |  |  |  |   | 1,962   |         |
| Investment in joint venture                                                                        |  |  |                              |   | (300    | )      |  |  |  |   | — |         |
| Return of capital from joint venture                                                               |  |  |                              |   | — |             |  |  |  |   | 100     |         |
| Net cash used in investing activities                                                              |  |  |                              |   | (5,568  | )      |  |  |  |   | (61,884 | )  |
| Financing activities                                                                               |  |  |                              |   |    |             |  |  |  |   |    |         |
| Repayments of long-term debt                                                                       |  |  |                              |   | (633    | )      |  |  |  |   | (386    | )  |
| Borrowings on revolver, net                                                                        |  |  |                              |   | 491     |             |  |  |  |   | 73,310  |         |
| Debt issuance costs paid                                                                           |  |  |                              |   | — |             |  |  |  |   | (1,211  | )  |
| Net cash (used in) provided by financing activities                                                |  |  |                              |   | (142    | )      |  |  |  |   | 71,713  |         |
| Effect of exchange rate changes on cash                                                            |  |  |                              |   | 106     |             |  |  |  |   | 504     |         |
| Change in cash and cash equivalents                                                                |  |  |                              |   | (2,832  | )      |  |  |  |   | (16,769 | )  |
| Cash and cash equivalents at beginning of period                                                   |  |  |                              |   | 5,638   |             |  |  |  |   | 21,394  |         |
| Cash and cash equivalents at end of period                                                         |  |  |                              | $ | 2,806   |             |  |  |  | $ | 4,625   |         |
| Supplemental Cash Flow Information                                                                 |  |  |                              |   |    |             |  |  |  |   |    |         |
| Interest paid                                                                                      |  |  |                              | $ | 22,610  |             |  |  |  | $ | 18,343  |         |
| Income taxes paid                                                                                  |  |  |                              | $ | 2,322   |             |  |  |  | $ | 1,938   |         |
| Property, plant and equipment in trade accounts payable                                            |  |  |                              | $ | 639     |             |  |  |  | $ | 1,251   |         |

See accompanying notes.

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Table of Contents

ATT HOLDING CO.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Dollars in thousands)(Unaudited)

1.    Basis of Presentation

The accompanying unaudited condensed consolidated financial statements and the accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America (‘‘US GAAP’’) and the rules of the Securities and Exchange Commission (‘‘SEC’’). In the opinion of management, all adjustments necessary for a fair presentation have been included. All adjustments were comprised of normal recurring adjustments, except as noted in the Notes to Condensed Consolidated Financial Statements. Due to the seasonal nature of our business, the results of operations for the thirteen and thirty-nine week periods ended June 30, 2007 are not necessarily indicative of results for the entire fiscal year ending September 29, 2007. Certain information and notes normally included in financial statements prepared in accordance with US GAAP have been condensed or omitted pursuant to the rules and regulations of the SEC. These interim financial statements and the related notes contain the accounts of ATT Holding Co. (the Company) on a consolidated basis and should be read in conjunction with the financial statements and notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2006.

The accompanying condensed consolidated financial statements include the accounts of ATT Holding Co. and its wholly-owned subsidiaries. All material intercompany transactions have been eliminated in consolidation.

All entities and assets owned by ATT Holding Co. subsequent to June 27, 2004 are referred to collectively as the ‘‘Company’’. All entities and assets owned by ATT Holding Co. on June 27, 2004 or prior are referred to collectively as the ‘‘Predecessor.’’ ATT Holding Co. is a holding company which has no interest, operations or activities other than through its ownership of 100% of Ames True Temper (ATT).

Reclassifications

To maintain consistency with current presentation, the Company reclassified $187 of current portion of capital lease obligations from accrued expenses and other current liabilities to current portion of long-term debt and $65 of long-term portion of capital lease obligations from other liabilities to long-term debt in the September 30, 2006 condensed consolidated balance sheet. In addition, the Company reclassified certain deferred tax liabilities of $2,542 from accrued expenses and other current liabilities to deferred income taxes in the September 30, 2006 condensed consolidated balance sheet. These reclassifications had no effect on previously reported operating income, net loss or stockholders’ deficit.

2.    Recent Accounting Pronouncements

In July 2006, the Financial Accounting Standards Board (‘‘FASB’’) issued FASB Interpretation No. 48, ‘‘Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statement No. 109,’’ (‘‘FIN 48’’). FIN 48 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. A two-step process is prescribed whereby the threshold for recognition is a more-likely-than-not test that the tax position will be sustained upon examination based on the technical merits of the position, and the tax position is measured at the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement. FIN 48 is effective for the first quarter of the fiscal year ending September 27, 2008. The Company is currently evaluating what effect, if any, adoption of FIN 48 will have on the Company’s consolidated financial statements.

In September 2006, the FASB issued Statement of Financial Accounting Standards (‘‘SFAS’’) No. 157, ‘‘Fair Value Measurements’’, (SFAS 157). SFAS 157 defines fair value, establishes a framework for 

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ATT HOLDING CO.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Dollars in thousands)(Unaudited)

measuring fair value in generally accepted accounting principles (‘‘GAAP’’) and expands disclosures about fair value measurements. The statement applies under other accounting pronouncements that require or permit fair value measurements. Accordingly, SFAS 157 does not require any new fair value measurements. However, for some entities, the application of SFAS 157 will change current practice. This statement is effective for fiscal years beginning after November 15, 2007. The Company is required to adopt SFAS 157 in the first quarter of fiscal year 2009. The Company is currently evaluating what effect, if any, adoption of SFAS 157 will have on the Company’s consolidated financial statements.

In September 2006, the FASB issued SFAS No. 158, ‘‘Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of SFAS statements No. 87, 88, 106 and 132(R)’’, (‘‘SFAS 158’’), to improve financial reporting by requiring an employer to recognize the overfunded or underfunded status of a defined benefit post-retirement plan as an asset or liability. SFAS 158 requires employers to recognize in its changes of financial position the funded status of a benefit plan, measured as the difference between plan assets at fair value and the benefit obligation. For pension plans, the benefit obligation is the projected benefit obligation; for any other post-retirement benefit plan, such as a retiree health care plan, the benefit obligation is the accumulated benefit obligation. If plan assets exceed plan liabilities, an asset would be recognized, and if plan liabilities exceed plan assets, a liability would be recognized. In addition, SFAS 158 requires changes in the funded status of a defined benefit post-retirement plan be recognized in comprehensive income in the year in which the changes occur. SFAS 158 does not change the amount of the expense recorded in a company’s statement of operations related to defined benefit post-retirement plans. SFAS 158 is effective for fiscal years ending after June 15, 2007. The Company is currently evaluating what effect, if any, adoption of SFAS 158 will have on the Company’s consolidated financial statements, which will not be determined until the September 29, 2007 measurement date of the assets and benefit obligations of the defined benefit plans.

In September 2006, the Securities and Exchange Commission issued Staff Accounting Bulletin (SAB) No. 108, ‘‘Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements,’’ (‘‘SAB 108’’). SAB 108 requires companies to evaluate the materiality of identified unadjusted errors on each financial statement and related financial statement disclosure using both the rollover approach and the iron curtain approach. The rollover approach quantifies misstatements based on the amount of the error in the current year financial statements whereas the iron curtain approach quantifies misstatements based on the effects of correcting the misstatement existing in the balance sheet at the end of the current year, irrespective of the misstatement’s year(s) of origin. Financial statements would require adjustment when either approach results in quantifying misstatement that is material. Correcting prior year financial statements for immaterial errors would not require previously filed reports to be amended. SAB 108 is effective in the fiscal year ending September 29, 2007. The adoption of SAB 108 had no impact on the Company’s consolidated financial statements.

In February 2007, The FASB issued SFAS No. 159, ‘‘The Fair Value Option for Financial Assets and Financial Liabilities, Including an Amendment of FASB Statement No. 115 ’’ (‘‘SFAS 159’’). SFAS 159 permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. SFAS 159 does not affect any existing accounting literature that requires certain assets and liabilities to be carried at fair value. SFAS 159 is effective for fiscal years beginning after November 15, 2007. The Company has not yet assessed the impact, if any, on its consolidated financial statements of adopting SFAS 159.

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ATT HOLDING CO.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Dollars in thousands)(Unaudited)

3.    Acquisitions and Purchase Accounting

Acquisition of Predecessor

On June 28, 2004, the Company completed the sale of all outstanding common and preferred stock of the Predecessor to affiliates of Castle Harlan, Inc., a private equity group. CHATT Holdings Inc., the ‘‘buyer’’, and CHATT Holdings LLC, the ‘‘buyer parent’’, were created to make the acquisition of the Company. Approximately 87% of the equity interests of the buyer parent are owned by affiliates of Castle Harlan, and the remainder was issued to members of our management who held capital stock in the Predecessor, in lieu of cash consideration that they otherwise would have been entitled to receive in the acquisition. In addition, certain members of management that did not hold equity in the Predecessor purchased an equity interest in the buyer parent for cash.

The acquisition of the Predecessor was accounted for as a purchase in accordance with SFAS No. 141, Business Combinations, and Emerging Issues Task Force (EITF) Issue No. 88-16, Basis in Leveraged Buyout Transactions. As such, the acquired assets and assumed liabilities have been recorded at fair market value for the interests acquired and estimates of assumed liabilities by new investors and at the carryover basis for continuing investors. The acquired assets and assumed liabilities were assigned new book values in the same proportion as the residual interests of the continuing investors and the new interests acquired by the new investors. Under EITF 88-16, the Company was revalued at the merger date to the fair value to the extent of the majority stockholder’s approximately 87% controlling interest in the Company. The remaining approximately 13% is accounted for at the continuing stockholders’ carryover basis in the Company. An adjustment of $13,539 to record this effect is included as a reduction of stockholders’ equity under the caption ‘‘Predecessor basis adjustment.’’ The excess of the purchase price over the historical basis of the net assets acquired has been applied to adjust net assets to their fair values to the extent of the majority stockholder’s approximately 87% ownership.

Acquisition of Acorn and Hound Dog

On April 7, 2006, ATT, a direct wholly-owned subsidiary of the Company, acquired Acorn Products, Inc. (‘‘Acorn’’), a Delaware corporation and the parent company of UnionTools, Inc. (‘‘Union’’), a business engaged in the manufacture and distribution of non-powered lawn and garden tools, pursuant to an Agreement and Plan of Merger (the ‘‘Acorn Merger Agreement’’) among ATT, Acorn and ATTUT Holdings, Inc., a Delaware corporation and wholly-owned subsidiary of ATT (‘‘Merger Sub’’). Pursuant to the Acorn Merger Agreement, ATT acquired all of the issued and outstanding capital stock of Acorn through the merger of Merger Sub with and into Acorn, with Acorn surviving as a wholly-owned subsidiary of ATT (the ‘‘Acorn Merger’’). The Acorn Merger was consummated simultaneously with the execution of the Acorn Merger Agreement. The aggregate cash consideration paid by ATT on the day of the transaction was $46,394.

On April 12, 2006, HD Acquisition Corp. (‘‘HDAC’’), a wholly-owned subsidiary of ATT, completed the acquisition of substantially all of the assets and intellectual property of Hound Dog Products, Inc. (‘‘Hound Dog’’), a business that designs, markets and distributes non-powered lawn and garden tools. The transaction was consummated simultaneously with the execution of an Asset Purchase Agreement (the ‘‘Asset Purchase Agreement’’) among HDAC, Hound Dog and the shareholders of Hound Dog. The cash consideration paid by HDAC on the day of the transaction was $5,161.

These businesses were acquired to expand the Company’s product lines. The operating results of the acquired companies have been included in the accompanying consolidated statements of operations from the respective dates of acquisition. The acquisitions of Acorn and Hound Dog are 

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ATT HOLDING CO.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Dollars in thousands)(Unaudited)

being accounted for as purchases in accordance with SFAS No. 141, Business Combinations. Prior to the end of fiscal year 2006, Acorn, Union and HDAC were merged into Ames True Temper. Goodwill resulting from these transactions is not deductible for income tax purposes. The following represents the final allocation of purchase price for the Acorn and Hound Dog acquisitions:

|                                                                                          |  |  |  |   |         |         |
|------------------------------------------------------------------------------------------|--|--|--|---|---------|---------|
| Revolver debt used for purchase price including acquisition costs, net of cash acquired  |  |  |  | $ | 50,126  |         |
| Other liabilities assumed                                                                |  |  |  |   | 18,900  |         |
| Fair value of assets acquired, primarily accounts receivable, inventory and fixed assets |  |  |  |   | (47,260 | )  |
| Contingent payment to Hound Dog shareholders                                             |  |  |  |   | 602     |         |
| Identified intangible assets, primarily tradenames and patents                           |  |  |  |   | (4,830  | )  |
| Cost in excess of fair value of net assets acquired (goodwill)                           |  |  |  | $ | 17,538  |         |

In connection with the Acorn acquisition, the Company formulated restructuring plans for the integration of the acquired business. See Note 4 for additional information regarding these plans.

The following unaudited pro forma financial information reflects the results of operations as if the acquisition of Acorn had occurred as of the beginning of the periods being presented. Pro forma adjustments include only the effects of events directly attributed to the transaction that are factually supportable and expected to have a continuing impact.

The pro forma data reflected in the table below includes adjustments to conform the acquired business’ accounting policies to the Company’s accounting policies, and interest expense on the acquisition debt and the related income tax effects.

|                                       |  |  |                                          |  |  |           |  |  |            |
|---------------------------------------|--|--|------------------------------------------|--|--|-----------|--|--|------------|
| Thirteen WeekPeriod EndedJuly 1, 2006 |  |  | Thirty-Nine WeekPeriod EndedJuly 1, 2006 |
| Net Sales                             |  |  | Net Income                               |  |  | Net Sales |  |  | Net Income |
| $164,497                              |  |  | $7,545                                   |  |  | $424,999  |  |  | $2,607     |

The unaudited pro forma financial information does not necessarily reflect the operating results that would have occurred had the acquisition been consummated as of the above date, nor is such information indicative of future operating results. Pro-forma information, reflecting the results of operations of Hound Dog, is not provided as this acquisition did not materially impact the Company’s results of operations.

As of the date of ownership change, Acorn had approximately $88,000 of federal net operating loss carryforwards.  Due to the ownership change, the net operating losses of Acorn became limited under Internal Revenue Code §382 and limited as well under the normal expiration dates of federal net operating loss carryforwards. It is currently projected that ATT will be able to utilize approximately $900 of the loss carryforwards.  In order to avoid negative tax consequences of allowing net operating losses to expire unutilized, ATT elected to relinquish the portion of the net operating losses that are in excess of the amounts projected to be utilized.

4.    Restructuring

Restructuring Related to Acquisition of Predecessor

In connection with the acquisition of the Predecessor on June 28, 2004, the Company began to assess and formulate an exit and restructuring plan that includes reductions of workforce, facility closures and changes in business strategies. The Company’s plan met the conditions of EITF 95-3. This 

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ATT HOLDING CO.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Dollars in thousands)(Unaudited)

exit and restructuring plan is intended to increase operating efficiencies. At June 28, 2004, the Company recorded a liability of $4,782 related to the reductions of workforce and facility closures and $4,795 related to changes in business strategies for a product line. Adjustments have been made to these reserves as the cost estimates are refined and finalized. The Company expects to complete the implementation of these plans within the next one to two years. During the thirty-nine week period ended June 30, 2007, the Company reduced the restructuring reserve based on payments and the refinement of cost estimates.

At June 30, 2007, the remaining restructuring reserves of $1,768 are included in accrued expenses and other current liabilities and other liabilities and relate to portions of the exit plans that are not yet complete. Changes to the restructuring reserves are as follows:

|                                            |  |  |  |   |        |         |
|--------------------------------------------|--|--|--|---|--------|---------|
| Balance as of September 30, 2006 |  |  |  | $ | 3,470  |         |
| Accretion of Interest                      |  |  |  |   | 164    |         |
| Adjustments                                |  |  |  |   | (499   | )  |
| Payments                                   |  |  |  |   | (1,367 | )  |
| Balance as of June 30, 2007      |  |  |  | $ | 1,768  |         |

Restructuring Related to Acquisition of Acorn

At date of acquisition, the Company recorded a reserve of $1,547 associated with certain facility closures and reductions in workforce as part of a facility consolidation plan. The Company appropriately met the conditions as outlined in EITF 95-3 to record such charges as liabilities in a purchase accounting combination. This plan was executed beginning in the third quarter of fiscal 2006 and is expected to be completed in fiscal 2007. As the Company obtains additional information regarding costs to close certain facilities, adjustments may be made to the restructuring reserves. In addition, certain employees were given retention packages totaling approximately $2,987 to transition their current roles over 4-12 months. These costs are being recognized over the retention period and have not been included in the purchase price or as a reduction to the net assets acquired. Severance payments for these retention packages began in the Company’s fourth quarter of fiscal 2006 and were completed during the second quarter of fiscal 2007.

At June 30, 2007, the remaining restructuring reserves of $147 were included in accrued expenses and other current liabilities and related to portions of the exit plans that are not yet complete. Changes to the restructuring reserves are as follows:

|                                            |  |  |  |   |       |         |
|--------------------------------------------|--|--|--|---|-------|---------|
| Balance as of September 30, 2006 |  |  |  | $ | 1,175 |         |
| Payments                                   |  |  |  |   | (829  | )  |
| Adjustments                                |  |  |  |   | (199  | )  |
| Balance as of June 30, 2007      |  |  |  | $ | 147   |         |

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ATT HOLDING CO.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Dollars in thousands)(Unaudited)

5.    Inventories

Inventories are as follows:

|                 |  |  |              |   |         |                    |  |  |  |   |         |  |
|-----------------|--|--|--------------|---|---------|--------------------|--|--|--|---|---------|--|
|            |  |  | June 30,2007 |   |         | September 30, 2006 |
| Finished goods  |  |  |              | $ | 67,163  |                    |  |  |  | $ | 86,380  |  |
| Work in process |  |  |              |   | 16,701  |                    |  |  |  |   | 21,326  |  |
| Raw materials   |  |  |              |   | 28,144  |                    |  |  |  |   | 33,533  |  |
|            |  |  |              | $ | 112,008 |                    |  |  |  | $ | 141,239 |  |

6.    Goodwill and Other Intangibles

In accordance with SFAS No. 142, Goodwill and Other Intangible Assets, the Company is required to test goodwill and indefinite lived intangible assets for impairment on at least an annual basis. Definite lived intangible assets are tested for impairment when events or circumstances indicate that the carrying amount of an asset may not be recoverable. There can be no assurance that future impairment tests will not result in a charge to earnings. There was a revision to goodwill during the thirty-nine weeks ended June 30, 2007, primarily as a result of the impact of foreign currency exchange and the contingent payment related to the Hound Dog transaction. The cost of other acquired intangible assets, including primarily customer relationships and covenants not to compete, is amortized on a straight-line basis over the estimated lives of 1 to 18 years. Amortization of other intangibles amounted to $375 and $1,120 for the thirteen and thirty-nine weeks ended June 30, 2007, respectively. The estimated aggregate amortization expense for each of the succeeding periods is as follows: $372 for the remainder of fiscal 2007; $1,337 in fiscal 2008; $1,221 in fiscal 2009; $1,211 in fiscal 2010; $1,200 in fiscal 2011 and $3,533 thereafter.

The changes in carrying amount of goodwill for the thirty-nine week period ended June 30, 2007 are as follows:

|                                          |  |  |  |   |        |         |
|------------------------------------------|--|--|--|---|--------|---------|
| Goodwill at September 30, 2006 |  |  |  | $ | 58,359 |         |
| Revision of purchase price allocation    |  |  |  |   | (127   | )  |
| Reclass to other intangibles             |  |  |  |   | 26     |         |
| Currency translation adjustments         |  |  |  |   | 630    |         |
| Goodwill at June 30, 2007      |  |  |  | $ | 58,888 |         |

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ATT HOLDING CO.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Dollars in thousands)(Unaudited)

The following table reflects the components of intangible assets other than goodwill:

|                                     |  |  |              |   |        |                    |  |  |  |   |        |         |
|-------------------------------------|--|--|--------------|---|--------|--------------------|--|--|--|---|--------|---------|
|                                |  |  | June 30,2007 |   |        | September 30, 2006 |
| Finite lived intangible assets:     |  |  |              |   |   |                    |  |  |  |   |   |         |
| Technology (patents)                |  |  |              | $ | 1,356  |                    |  |  |  | $ | 1,356  |         |
| Non-compete agreements              |  |  |              |   | 977    |                    |  |  |  |   | 976    |         |
| Customer relationships              |  |  |              |   | 11,728 |                    |  |  |  |   | 11,672 |         |
|                                |  |  |              |   | 14,061 |                    |  |  |  |   | 14,004 |         |
| Accumulated amortization:           |  |  |              |   |   |                    |  |  |  |   |   |         |
| Technology (patents)                |  |  |              |   | (854   | )             |  |  |  |   | (619   | )  |
| Non-compete agreements              |  |  |              |   | (918   | )             |  |  |  |   | (902   | )  |
| Customer relationships              |  |  |              |   | (3,415 | )             |  |  |  |   | (2,546 | )  |
|                                |  |  |              |   | (5,187 | )             |  |  |  |   | (4,067 | )  |
| Net finite lived intangible assets  |  |  |              |   | 8,874  |                    |  |  |  |   | 9,937  |         |
| Indefinite lived intangible assets: |  |  |              |   |   |                    |  |  |  |   |   |         |
| Trade names                         |  |  |              |   | 68,794 |                    |  |  |  |   | 68,513 |         |
| Total Intangibles, net              |  |  |              | $ | 77,668 |                    |  |  |  | $ | 78,450 |         |

7.     Income Taxes

At the end of each interim reporting period, the Company estimates the effective tax rate expected to be applicable for the full fiscal year. The rate determined is used in providing for income taxes on a year-to-date basis. The tax effect of significant unusual items is reflected in the period in which they occur. During the thirty-nine weeks ended June 30, 2007, based on revised projections of future taxable income we recorded a valuation allowance of $6,878 on remaining U.S. federal and state deferred tax assets which are not otherwise offset by reversing deferred tax liabilities. The valuation allowance is primarily attributable to the uncertainty regarding the realization of the federal and state deferred tax assets, including net operating loss carryforwards, related to United States operations.

8.    Debt Arrangements

Senior Subordinated Notes

On June 28, 2004, the Company completed a private offering of $150,000 in aggregate principal amount at maturity of 10% Senior Subordinated Notes due July 15, 2012. The Senior Subordinated Notes are fully and unconditionally guaranteed by the Company on a senior subordinated basis. On August 10, 2004, we filed a registration statement with respect to new notes having substantially identical terms as the original notes, as part of an offer to exchange registered notes for the privately issued original Senior Subordinated Notes. The new notes evidence the same debt as the original Senior Subordinated Notes, are entitled to the benefits of the indenture governing the original Senior Subordinated Notes and are treated under the indenture as a single class with the original notes. The exchange offer was completed on November 24, 2004.

The new Senior Subordinated Notes are unsecured senior subordinated obligations and rank behind all of our existing and future senior debt, including borrowings under the Amended and Restated Senior Secured Credit Agreement, equally with any of the Company’s future senior subordinated debt, ahead of any of the Company’s future debt that expressly provides for 

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ATT HOLDING CO.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Dollars in thousands)(Unaudited)

subordination to the new Senior Subordinated Notes and effectively behind all of the existing and future liabilities of our subsidiaries, including trade payables. The Company also guarantees the new Senior Subordinated Notes on a senior subordinated basis. This guarantee ranks behind all existing and future senior debt of the Company, including the guarantee of the Amended and Restated Senior Secured Credit Facility and the Senior Floating Rate Notes, equal to all future senior subordinated indebtedness and ahead of all future debt that expressly provides that it is subordinated to the guarantee.

The Company pays interest on the new Senior Subordinated Notes semi-annually in cash, in arrears, on January 15 and July 15 at an annual rate of 10.00%. The indenture governing new Senior Subordinated Notes contains various affirmative and negative covenants, subject to a number of important limitations and exceptions, including but not limited to those limiting the Company’s ability and the ability of the Company’s restricted subsidiaries to borrow money, guarantee debt or sell preferred stock, create liens, pay dividends on or redeem or repurchase stock, make certain investments, sell stock in the Company’s restricted subsidiaries, restrict dividends or other payments from restricted subsidiaries, enter into transactions with affiliates and sell assets or merge with other companies.

The indenture governing the new Senior Subordinated Notes contains various events of default, including but not limited to those related to non-payment of principal, interest or fees; violations of certain covenants; certain bankruptcy-related events; invalidity of liens; non-payment of certain legal judgments; and cross defaults with certain other indebtedness. The Company may redeem the Senior Subordinated Notes on or after July 15, 2008, except the Company may redeem up to 35% of the new Senior Subordinated Notes prior to July 15, 2007 with the proceeds of one or more public equity offerings. The Company is required to redeem the new Senior Subordinated Notes under certain circumstances involving changes of control.

Senior Floating Rate Notes

On January 14, 2005, ATT completed the offering of $150,000 Senior Floating Rate Notes due 2012. The proceeds of this offering were used by the Company to repay the entire balance of Term Loan B, which amounted to $139,300. Additionally, the proceeds were used to pay transaction fees and repay a portion of the revolving credit facility.

The Senior Floating Rate Notes, issued at a 0.50% discount, bear interest at a floating rate per annum, reset quarterly, equal to LIBOR plus 4.00%, which was 9.36% at June 30, 2007. The Senior Floating Rate Notes pay interest quarterly in cash in arrears on January 15, April 15, July 15 and October 15 of each year. The Senior Floating Rate Notes mature on January 15, 2012, unless earlier redeemed or repurchased, and are subject to the terms and conditions set forth in the Indenture. The Company guarantees the Senior Floating Rate Notes.

The Senior Floating Rate Notes are unsecured, unsubordinated obligations of ATT. They are effectively subordinated to all existing and future secured debt, to the extent of the assets securing such debt, including borrowings under the Amended and Restated Senior Secured Credit Agreement, pari passu with all future senior unsecured indebtedness, senior in right of payment to all existing and future senior subordinated debt, including the Senior Subordinated Notes, and effectively behind all of the existing and future liabilities of ATT’s subsidiaries, including trade payables.

Interest Rate Swaps

In connection with the issuance of the Senior Floating Rate Notes, ATT entered into interest rate swaps (the ‘‘Swaps’’) with Bank of America, N.A. and Wachovia Bank, N.A. Pursuant to the Swap with Bank of America, N.A., which became effective on January 17, 2006, ATT swaps 3-month 

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LIBOR rates for fixed interest rates of 4.31% on a notional amount of $100,000 for the period from January 17, 2006 through January 15, 2008, $66,667 for the period from January 16, 2008 to January 15, 2009 and $33,333 for the period from January 16, 2009 through January 15, 2010. Pursuant to the Swap with Wachovia Bank, N.A., effective January 15, 2006, ATT swaps 3 month LIBOR rates for fixed interest rates of 4.29% on a notional amount of $50,000 for the period from January 15, 2006 through January 15, 2008, $33,333 for the period from January 16, 2008 to January 15, 2009 and $16,667 for the period from January 16, 2009 through January 15, 2010. These swaps fix the variable rate portion of the Senior Floating Rate Notes, while there is an additional margin of 4.00% that is fixed.

The Company has accounted for the interest rate swaps in accordance with Statement of Financial Accounting Standards No. 133, Accounting for Derivative Instruments and Hedging Activities, as amended by SFAS No. 138, Accounting for Certain Derivative Instruments and Certain Hedging Activities and SFAS No. 149, Amendment of Statement 133 on Derivative Instruments and Hedging Activities (collectively, ‘‘SFAS 133’’).  SFAS 133 establishes accounting and reporting standards for derivative instruments and hedging activities.  SFAS 133 requires that all derivatives be recognized as either assets or liabilities at fair value. The Company has accounted for the swaps as cash flow hedges. As of June 30, 2007, the interest rate swaps were recorded as an asset of $2,138, included in other noncurrent assets in the Company’s consolidated balance sheet. For the thirty-nine week period ended June 30, 2007, the change in fair value was recognized as a reduction of other comprehensive income of $299, net of deferred taxes of $184.

Term Note

On July 19, 2005, ATT entered into a $2,700 Term Note, Loan and Security Agreement and Subordination Agreement with a Lender. This note is payable in monthly installments over five years. The interest rate per annum is equal to 2.50% and secured by certain collateral, which was agreed to by the Administrative Agent of the Amended and Restated Senior Secured Credit Facility. Under the terms of this note, ATT is required to create 108 jobs at the new manufacturing facility in Pennsylvania within three years of the completion of the facility. The Term Note contains customary events of default (subject to customary exceptions, thresholds and grace periods), including, without limitation: nonpayment of principal, interest, fees and failure to perform or observe certain covenants. As of June 30, 2007, ATT was in compliance with these covenants.

Amended and Restated Senior Secured Credit Agreement

On April 7, 2006, in conjunction with the acquisition of Acorn, ATT entered into an amended and restated Senior Secured Credit Agreement with Bank of America, N.A., as administrative agent, swing line lender and letter of credit issuer, Acorn, Union, and Ames True Temper Properties, Inc. (‘‘ATTP’’); together with ATT (the ‘‘Borrowers’’), the Company, as guarantor, and each lender from time to time thereto (the ‘‘Credit Agreement’’). The Credit Agreement amends and restates ATT’s existing credit facility with, among others, Bank of America, N.A. Pursuant to the Credit Agreement, the lenders made available a five-year revolving credit facility of up to $130,000 in order to finance the acquisition of Acorn, pay fees and expenses associated with the acquisition, repay outstanding debt and provide for ongoing working capital.

Borrowings outstanding under the revolving credit facility as of June 30, 2007 and September 30, 2006 were $67,099 and $66,608, respectively. The Company had letters of credit outstanding totaling $3,882 and $2,410 as of June 30, 2007 and September 30, 2006, respectively. The total amount available under the revolving credit facility at June 30, 2007 was $53,097. In addition, the Company had letters of credit outstanding with another financial institution in the amount of $0 and 

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ATT HOLDING CO.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Dollars in thousands)(Unaudited)

$1,982 as of June 30, 2007 and September 30, 2006, respectively. The interest rate for base rate loans under the revolving credit facility is calculated as the higher of 1) the prevailing Federal Funds rate plus 50 basis points or 2) the administrative agent’s prime interest rate plus an applicable rate determined by the Company’s consolidated leverage ratio as defined in the Credit Agreement. The interest rate for base rate loans under the revolving credit facility was 9.75% at June 30, 2007.

Total indebtedness is as follows:

|                                                                                                 |  |  |              |   |         |                    |  |  |  |   |         |         |
|-------------------------------------------------------------------------------------------------|--|--|--------------|---|---------|--------------------|--|--|--|---|---------|---------|
|                                                                                            |  |  | June 30,2007 |   |         | September 30, 2006 |
| Revolving loan facility dated 4/7/06, expires 2011                                              |  |  |              | $ | 67,099  |                    |  |  |  | $ | 66,608  |         |
| Term Note due 2010                                                                              |  |  |              |   | 1,709   |                    |  |  |  |   | 2,103   |         |
| Capital lease obligations                                                                       |  |  |              |   | 105     |                    |  |  |  |   | 252     |         |
| Senior Floating Rate Notes due 2012, net of unamortized discount of $483 and $563, respectively |  |  |              |   | 149,517 |                    |  |  |  |   | 149,437 |         |
| 10% Senior Subordinated Notes due 2012                                                          |  |  |              |   | 150,000 |                    |  |  |  |   | 150,000 |         |
| Total debt                                                                                      |  |  |              |   | 368,430 |                    |  |  |  |   | 368,400 |         |
| Less short-term revolving loan facilities                                                       |  |  |              |   | (67,099 | )             |  |  |  |   | (66,608 | )  |
| Less current portion of capital lease obligations                                               |  |  |              |   | (90     | )             |  |  |  |   | (187    | )  |
| Less current portion of long-term debt                                                          |  |  |              |   | (541    | )             |  |  |  |   | (528    | )  |
| Long-term debt                                                                                  |  |  |              | $ | 300,700 |                    |  |  |  | $ | 301,077 |         |

The Credit Agreement and the Senior Subordinated Notes contain various affirmative and negative covenants customary for similar credit facilities (subject to customary exceptions and certain existing obligations and liabilities), including, but not limited to, restrictions (with exceptions) on: liens; debt; loans, acquisitions, joint ventures and other investments; mergers and consolidations, sales, transfers and other dispositions of property or assets; dividends, distributions, redemptions and other restricted payments; changes in the nature of the Company’s business; transactions with affiliates; and prepayment, redemption or repurchase of certain debt. In addition, the Credit Agreement and term note require that the Company meet certain financial covenants. Capital expenditures are subject to fiscal year limitations of $16,125 in 2007 and $15,000 thereafter. In the event the Company triggers Cash Dominion as defined in the Credit Agreement, the Company is required to maintain a minimum consolidated earnings before interest, income taxes, depreciation and amortization modified by certain adjustments as defined in the Credit Agreement (‘‘Adjusted EBITDA’’) of $41,000 for any period of four quarters ending on the last day of any fiscal quarter. As of June 30, 2007, the Company was in compliance with all applicable debt covenants.

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ATT HOLDING CO.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Dollars in thousands)(Unaudited)

9.    Pension and Other Post-retirement Benefits

|                                       |  |  |                           |   |        |                           |  |  |              |   |        |             |  |  |  |   |         |         |  |  |  |   |         |  |
|---------------------------------------|--|--|---------------------------|---|--------|---------------------------|--|--|--------------|---|--------|-------------|--|--|--|---|---------|---------|--|--|--|---|---------|--|
|                                  |  |  | Pension Benefits          |   |        | Other Benefits            |
|                                  |  |  | Thirteen WeekPeriod Ended |   |        | Thirteen WeekPeriod Ended |
|                                  |  |  | June 30,2007              |   |        | July 1,2006               |  |  | June 30,2007 |   |        | July 1,2006 |
| Service Cost                          |  |  |                           | $ | 798    |                           |  |  |              | $ | 923    |             |  |  |  | $ | 1       |         |  |  |  | $ | 1       |  |
| Interest Cost                         |  |  |                           |   | 2,141  |                           |  |  |              |   | 2,009  |             |  |  |  |   | 26      |         |  |  |  |   | 39      |  |
| Expected return on plan assets        |  |  |                           |   | (2,897 | )                    |  |  |              |   | (2,871 | )      |  |  |  |   | — |         |  |  |  |   | — |  |
| Amortization of unrecognized net loss |  |  |                           |   | (12    | )                    |  |  |              |   | 128    |             |  |  |  |   | (28     | )  |  |  |  |   | — |  |
| Net periodic benefit cost             |  |  |                           | $ | 30     |                           |  |  |              | $ | 189    |             |  |  |  | $ | (1      | )  |  |  |  | $ | 40      |  |

|                                       |  |  |                              |   |        |                              |  |  |                   |   |        |                  |  |  |  |   |         |         |  |  |  |   |         |  |
|---------------------------------------|--|--|------------------------------|---|--------|------------------------------|--|--|-------------------|---|--------|------------------|--|--|--|---|---------|---------|--|--|--|---|---------|--|
|                                  |  |  | Pension Benefits             |   |        | Other Benefits               |
|                                  |  |  | Thirty-Nine WeekPeriod Ended |   |        | Thirty-Nine WeekPeriod Ended |
|                                  |  |  | June 30,2007            |   |        | July 1,2006             |  |  | June 30,2007 |   |        | July 1,2006 |
| Service Cost                          |  |  |                              | $ | 2,390  |                              |  |  |                   | $ | 2,700  |                  |  |  |  | $ | 1       |         |  |  |  | $ | 2       |  |
| Interest Cost                         |  |  |                              |   | 6,419  |                              |  |  |                   |   | 5,315  |                  |  |  |  |   | 78      |         |  |  |  |   | 111     |  |
| Expected return on plan assets        |  |  |                              |   | (8,686 | )                       |  |  |                   |   | (7,710 | )           |  |  |  |   | — |         |  |  |  |   | — |  |
| Amortization of unrecognized net loss |  |  |                              |   | (37    | )                       |  |  |                   |   | 384    |                  |  |  |  |   | (83     | )  |  |  |  |   | — |  |
| Net periodic benefit cost             |  |  |                              | $ | 86     |                              |  |  |                   | $ | 689    |                  |  |  |  | $ | (4      | )  |  |  |  | $ | 113     |  |

Employer Contributions

During the thirteen week periods ended June 30, 2007 and July 1, 2006, the Company contributed $57 and $280, respectively, to its defined benefit pension plans. During the thirty-nine week periods ended June 30, 2007 and July 1, 2006 the Company contributed $474 and $373, respectively, to its defined benefit pension plans.

During the thirteen week periods ended June 30, 2007 and July 1, 2006, the Company contributed $0 and $34, respectively, to its post-retirement benefit plans. During the thirty-nine week periods ended June 30, 2007 and July 1, 2006, the Company contributed $0 and $119, respectively, to its post-retirement benefit plans.

On December 31, 2006, the Union pension and other benefit plans were merged into the Company’s pension and other benefit plans.

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ATT HOLDING CO.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Dollars in thousands)(Unaudited)

10.    Other Comprehensive Income (Loss)

|                                             |  |  |                           |   |        |             |  |  |  |   |        |  |
|---------------------------------------------|--|--|---------------------------|---|--------|-------------|--|--|--|---|--------|--|
|                                        |  |  | Thirteen WeekPeriod Ended |
|                                        |  |  | June 30,2007              |   |        | July 1,2006 |
| Net income                                  |  |  |                           | $ | 1,710  |             |  |  |  | $ | 7,572  |  |
| Other comprehensive income:                 |  |  |                           |   |   |             |  |  |  |   |   |  |
| Currency translation adjustment             |  |  |                           |   | 3,791  |             |  |  |  |   | 1,950  |  |
| Fair value adjustments of swaps, net of tax |  |  |                           |   | 334    |             |  |  |  |   | 650    |  |
| Comprehensive income                        |  |  |                           | $ | 5,835  |             |  |  |  | $ | 10,172 |  |

|                                             |  |  |                              |   |        |                  |  |  |  |   |        |  |
|---------------------------------------------|--|--|------------------------------|---|--------|------------------|--|--|--|---|--------|--|
|                                        |  |  | Thirty-Nine WeekPeriod Ended |
|                                        |  |  | June 30, 2007           |   |        | July 1,2006 |
| Net (loss) income                           |  |  |                              | $ | (8,408 | )           |  |  |  | $ | 5,524  |  |
| Other comprehensive (loss) income:          |  |  |                              |   |   |                  |  |  |  |   |   |  |
| Currency translation adjustment             |  |  |                              |   | 2,501  |                  |  |  |  |   | 1,817  |  |
| Fair value adjustments of swaps, net of tax |  |  |                              |   | (299   | )           |  |  |  |   | 2,094  |  |
| Comprehensive (loss) income                 |  |  |                              | $ | (6,206 | )           |  |  |  | $ | 9,435  |  |

11.    Segment Information

The Company’s operations are classified into one business segment. These operations are conducted primarily in the United States, and to a lesser extent, in Canada and Europe. The following table presents certain data by geographic areas:

|               |  |  |                            |   |         |                             |  |  |           |   |       |                             |  |  |  |   |         |  |  |  |  |   |       |  |
|---------------|--|--|----------------------------|---|---------|-----------------------------|--|--|-----------|---|-------|-----------------------------|--|--|--|---|---------|--|--|--|--|---|-------|--|
|          |  |  | Thirteen Week Period Ended |
|          |  |  | June 30,2007               |   |         | July 1,2006                 |
|          |  |  | Net Sales                  |   |         | EarningsBefore Income Taxes |  |  | Net Sales |   |       | EarningsBefore Income Taxes |
| United States |  |  |                            | $ | 132,727 |                             |  |  |           | $ | 462   |                             |  |  |  | $ | 140,483 |  |  |  |  | $ | 7,190 |  |
| Europe        |  |  |                            |   | 2,309   |                             |  |  |           |   | 126   |                             |  |  |  |   | 1,973   |  |  |  |  |   | 44    |  |
| Canada        |  |  |                            |   | 21,853  |                             |  |  |           |   | 2,337 |                             |  |  |  |   | 20,875  |  |  |  |  |   | 2,668 |  |
| Total         |  |  |                            | $ | 156,889 |                             |  |  |           | $ | 2,925 |                             |  |  |  | $ | 163,331 |  |  |  |  | $ | 9,902 |  |

|               |  |  |                               |   |         |                                  |  |  |           |   |        |                                  |  |  |  |   |         |  |  |  |  |   |       |         |
|---------------|--|--|-------------------------------|---|---------|----------------------------------|--|--|-----------|---|--------|----------------------------------|--|--|--|---|---------|--|--|--|--|---|-------|---------|
|          |  |  | Thirty-Nine Week Period Ended |
|          |  |  | June 30, 2007                 |   |         | July 1, 2006                     |
|          |  |  | Net Sales                     |   |         | (Loss) EarningsBeforeIncomeTaxes |  |  | Net Sales |   |        | (Loss) EarningsBeforeIncomeTaxes |
| United States |  |  |                               | $ | 354,089 |                                  |  |  |           | $ | (6,471 | )                           |  |  |  | $ | 324,524 |  |  |  |  | $ | (673  | )  |
| Europe        |  |  |                               |   | 5,879   |                                  |  |  |           |   | (88    | )                           |  |  |  |   | 4,927   |  |  |  |  |   | 16    |         |
| Canada        |  |  |                               |   | 55,898  |                                  |  |  |           |   | 4,712  |                                  |  |  |  |   | 56,501  |  |  |  |  |   | 7,619 |         |
| Total         |  |  |                               | $ | 415,866 |                                  |  |  |           | $ | (1,847 | )                           |  |  |  | $ | 385,952 |  |  |  |  | $ | 6,962 |         |

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ATT HOLDING CO.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Dollars in thousands)(Unaudited)

|               |  |  |                     |   |         |                    |  |  |  |   |         |  |
|---------------|--|--|---------------------|---|---------|--------------------|--|--|--|---|---------|--|
|          |  |  | Identifiable Assets |
|          |  |  | June 30, 2007       |   |         | September 30, 2006 |
| United States |  |  |                     | $ | 379,992 |                    |  |  |  | $ | 399,890 |  |
| Europe        |  |  |                     |   | 6,792   |                    |  |  |  |   | 6,589   |  |
| Canada        |  |  |                     |   | 58,448  |                    |  |  |  |   | 49,300  |  |
| Total         |  |  |                     | $ | 445,232 |                    |  |  |  | $ | 455,779 |  |

The Company’s top two customers represented approximately 37% and 19% of net sales for the thirteen week period ended June 30, 2007 and approximately 35% and 18% for the thirteen week period ended July 1, 2006. These customers represented approximately 31% and 18% of net sales for the thirty -nine week period ended June 30, 2007 and approximately 32% and 19% for the thirty-nine week period ended July 1, 2006.

12.    Joint Venture

During March 2007, the Company entered into a joint venture agreement with Nan Shan International Co., Ltd. for the purpose of manufacturing and marketing certain garden tools. The joint venture is 60% owned by Taiwan Nan Shan Bamboo Ware Co. and 40% owned by the Company. The joint venture will operate under the name Huzhou Lifeng Furniture Industry and Commerce Co., Ltd, which is located in China. The Company has a minority representation on the Board of Directors of the joint venture. The Company has accounted for its investment under the cost method.

13.    Related Party Transactions

The Company is party to a management agreement with Castle Harlan, Inc., an affiliate of a shareholder, under which Castle Harlan, Inc. provides business and organizational strategy, financial and investment management, advisory, merchant and investment banking services to the Company. The Company recorded expenses of $724 and $2,214 for the thirteen and thirty-nine weeks ended June 30, 2007, respectively, related to the annual management fees which are included in selling, general and administrative expense. The expense for the thirteen and thirty-nine week periods ended July 1, 2006 was $377 and $1,144, respectively. The management fees, are payable quarterly in advance in accordance with the management agreement.

14.    Contingencies

Management continually evaluates the Company’s contingencies, including various lawsuits and claims which arise in the normal course of business, product and general liabilities, worker’s compensation, property losses and other fiduciary liabilities for which the Company is self-insured or retains a high exposure limit. Self-insurance reserves are established based on actuarial estimates. Legal costs incurred in connection with the resolution of claims, lawsuits and other contingencies generally are expensed as incurred. In the opinion of management, its assessment of contingencies is reasonable and related reserves, are adequate; however, there can be no assurance that future quarterly or annual operating results will not be materially affected by final resolution of these matters. The following matters are the more significant of the Company’s identified contingencies.

During December 2004, a customer of Union was named in litigation that involved Union’s products. The complaint asserted causes of action against the defendant for improper advertisement to the consumer. The allegation suggests that advertisements led the consumer to believe that the hand tools sold were manufactured in the boundaries of the United States. The allegation asserts cause of action against the customer for common law fraud. In the event that courts would deem a judgment against our customer, there is a possibility that the customer would seek legal recourse for an unspecified amount in contributory damages.

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ATT HOLDING CO.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Dollars in thousands)(Unaudited)

The Company is involved in lawsuits and claims, including certain environmental matters, arising out of the normal course of its business. In the opinion of management, the ultimate amount of liability, if any, under pending litigation will not have a material adverse effect on the Company’s financial position, results of operations or cash flows.

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Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward Looking Statements

The following discussion and analysis of our parent’s results of operations and financial condition should be read in conjunction with and is qualified in its entirety by reference to the unaudited condensed consolidated financial statements and accompanying notes of ATT Holding Co. (the ‘‘Company’’) as it relates to the consolidated financial performance and results of operations of our parent, ATT Holding Co. A separate discussion for Ames True Temper, Inc. is not presented since our parent has no operations or assets separate from its investment in Ames True Temper, Inc. and since the Senior Subordinated Notes and the Senior Floating Rate Notes are guaranteed by our parent. This Form 10-Q contains forward-looking statements. All statements other than statements of historical fact are ‘‘forward-looking statements’’ for purposes of federal and state securities laws.

Forward-looking statements are identified by terms and phrases such as ‘‘may,’’ ‘‘will,’’ ‘‘plans,’’ ‘‘estimates,’’ ‘‘anticipates,’’ ‘‘believes,’’ ‘‘expects,’’ ‘‘intends’’ and similar expressions and include references to assumptions and related to our future prospects, developments and business strategies. Although we believe that such statements are based on reasonable assumptions, these forward-looking statements are subject to numerous factors, risks and uncertainties that could cause actual outcomes and results to be materially different from those projected or assumed in our forward-looking statements.

Factors that could cause actual results to differ materially from those expressed or implied in such forward-looking statements include, but are not limited to:

|  |              |                                      |
|--|--------------|--------------------------------------|
|  | •  | our liquidity and capital resources; |

|  |              |                                             |
|--|--------------|---------------------------------------------|
|  | •  | sales levels to existing and new customers; |

|  |              |                                           |
|--|--------------|-------------------------------------------|
|  | •  | increased concentration of our customers; |

|  |              |                                             |
|--|--------------|---------------------------------------------|
|  | •  | seasonality and adverse weather conditions; |

|  |              |                                   |
|--|--------------|-----------------------------------|
|  | •  | competitive pressures and trends; |

|  |              |                                |
|--|--------------|--------------------------------|
|  | •  | changing consumer preferences; |

|  |              |                                       |
|--|--------------|---------------------------------------|
|  | •  | new product and customer initiatives; |

|  |              |                                                           |
|--|--------------|-----------------------------------------------------------|
|  | •  | risks relating to foreign sourcing and foreign operations |

|  |              |                                         |
|--|--------------|-----------------------------------------|
|  | •  | availability and cost of raw materials; |

|  |              |                                                                        |
|--|--------------|------------------------------------------------------------------------|
|  | •  | our ability to successfully consummate and integrate acquisitions; and |

|  |              |                              |
|--|--------------|------------------------------|
|  | •  | general economic conditions. |

Our actual results, performance or achievements, could differ materially from those expressed in, or implied by, the forward-looking statements. We can give no assurances that any of the events anticipated by the forward-looking statements will occur or, if any of them do, what impact they will have on our results of operations and financial condition. We do not intend, and we undertake no obligation, to update any forward-looking statement included in this report, whether as a result of new information, future events or otherwise, after the date of this report. This report should be read in conjunction with the Company’s most recent financial statements, Item 1A, Risk Factors and the Management Discussion & Analysis (MD&A) included in the Company’s Form 10-K for the fiscal year ended September 30, 2006.

Overview

Ames True Temper, Inc. (‘‘ATT’’, ‘‘us’’, ‘‘we’’, ‘‘our’’ or the ‘‘Company’’) is a leading North American manufacturer and marketer of non-powered lawn and garden tools and accessories. We offer the following 14 distinct product lines with over 4,800 active SKUs: long handle tools, 

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wheelbarrows, planters, hose reels, snow tools, striking tools, decorative accessories, lawn carts, pruning tools, repair handles, garden hoses, Hound Dog, brooms and specialty tools. We sell our products primarily in the U.S. and Canada through (1) retail centers, including home centers and mass merchandisers, (2) wholesale chains, including hardware stores and garden centers, and (3) industrial distributors.

For the thirteen week periods ended June 30, 2007 and July 1, 2006, the Company’s net sales within the United States were 84.6% and 86.0% of total net sales, respectively. For the thirty-nine week periods ended June 30, 2007 and July 1, 2006, the Company’s net sales within the United States were 85.1% and 84.1% of total net sales, respectively.

In June 2004, affiliates of Castle Harlan, Inc., a New York-based private-equity investment firm, together with certain of our employees, completed the acquisition of our company from Wind Point Partners. In order to acquire our company, CHATT Holdings Inc., ‘‘the buyer’’, and CHATT Holdings LLC, ‘‘the buyer parent’’, were formed. Upon completion of the acquisition, affiliates of Castle Harlan, Inc. (Castle Harlan Partners IV, L.P., or CHP IV, and affiliates) owned approximately 87% of the buyer-parent and management owned approximately 13%. In order to finance the acquisition, repay our outstanding debt and pay related fees and expenses:

|  |           |                                                                                                                                                                                                                                        |
|--|-----------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (a)  | we entered into a $215.0 million senior credit facility consisting of a $75.0 million revolving credit facility and a $140.0 million term loan, as described in ‘‘Debt and Other Obligations;’’ |

|  |           |                                                                                                                                             |
|--|-----------|---------------------------------------------------------------------------------------------------------------------------------------------|
|  | (b)  | we issued $150.0 million of 10% senior subordinated notes, as described in ‘‘Debt and Other Obligations’’; and |

|  |           |                                                                                                                            |
|--|-----------|----------------------------------------------------------------------------------------------------------------------------|
|  | (c)  | the buyer parent received a $110.5 million equity capital contribution from CHP IV and its affiliates and management. |

On April 7, 2006, we acquired Acorn Products, Inc. (‘‘Acorn’’), the parent company of UnionTools, Inc. (‘‘Union’’), a business engaged in the manufacture and distribution of non-powered lawn and garden tools, pursuant to an Agreement and Plan of Merger (the ‘‘Acorn Merger Agreement’’) among us, Acorn and ATTUT Holdings, Inc., a Delaware corporation and wholly-owned subsidiary of ours (‘‘Merger Sub’’). Pursuant to the Acorn Merger Agreement, we acquired all of the issued and outstanding capital stock of Acorn through the merger of Merger Sub with and into Acorn, with Acorn surviving as a wholly-owned subsidiary of ours (the ‘‘Acorn Merger’’). The Acorn Merger was consummated simultaneously with the execution of the Acorn Merger Agreement. The aggregate cash consideration paid by us on the day of the transaction was $46.4 million.

On April 12, 2006, HD Acquisition Corp. (‘‘HDAC’’), a wholly-owned subsidiary of ours, completed the acquisition of substantially all of the assets and property of Hound Dog Products, Inc. (‘‘Hound Dog’’), a business that designs, markets and distributes non-powered lawn and garden tools. The transaction was consummated simultaneously with the execution of an Asset Purchase Agreement (the ‘‘Asset Purchase Agreement’’) among HDAC, Hound Dog and the shareholders of Hound Dog. The cash consideration paid by HDAC on the day of the transaction was $5.2 million.

These businesses were acquired to expand the Company’s product lines. The operating results of the acquired companies have been included in the accompanying consolidated statements of operations from the respective dates of acquisition. Prior to the end of fiscal year 2006, Acorn, Union and HDAC were merged into Ames True Temper.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements and the accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America (‘‘US GAAP’’) and the rules of the Securities and Exchange Commission (‘‘SEC’’).

The accompanying condensed consolidated financial statements include the accounts of ATT Holding Co. and its wholly-owned subsidiaries. All material intercompany transactions have been eliminated in consolidation.

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All entities and assets owned by ATT Holding Co. subsequent to June 27, 2004 are referred to collectively as the ‘‘Company’’. All entities and assets owned by ATT Holding Co. on June 27, 2004 or prior are referred to collectively as the ‘‘Predecessor.’’ ATT Holding Co. is a holding company which has no interest, operations or activities other than through its ownership of 100% of Ames True Temper (ATT).

Results of Operations

Thirteen weeks ended June 30, 2007 compared to thirteen weeks ended July 1, 2006

Net Sales.    Net sales for the thirteen-week period ended June 30, 2007 decreased $6.4 million to $156.9 million compared to $163.3 million for the thirteen weeks ended July 1, 2006. Overall net sales decreased primarily from decreased sales to certain major retail customers, and the recording of store servicing and advertising fees for certain customers as a reduction in revenue. In the prior year thirteen week period ended July 1, 2006, these store servicing and advertising fees were recorded as an expense in selling, general and administrative expenses (‘‘SG&A’’). Recording the store servicing fees as a reduction to revenue was due to a change in the structure of the store servicing arrangements and the excess of the fees over the fair value of the benefit derived from this arrangement with certain customers. Recording the advertising fees as a reduction to revenue was due to the excess of the fees over the fair value derived from the advertising arrangement with certain customers.

Gross Profit.    Gross profit for the thirteen weeks ended June 30, 2007 decreased $5.8 million to $38.1 million from $43.9 million for the thirteen weeks ended July 1, 2006. This decrease was due primarily to decreased sales volume and the recording of store servicing and advertising fees for certain customers as a reduction in revenue. In the prior thirteen-weeks ended July 1, 2006, these store servicing and advertising fees were recorded as an expense in SG&A. Recording the store servicing fees as a reduction to revenue was due to a change in the structure of the store servicing arrangements and the excess of the fair value of the benefit derived from this arrangement with certain customers. Recording the advertising fees as a reduction to revenue was due to the excess of the fees over the fair value derived from the advertising arrangement with certain customers. Gross profit as a percentage of net sales decreased to 24.3% from 26.9% during this period due to manufacturing variances related to lower production levels, the mix of products sold and the recording of store servicing and advertising fees as described above.

Selling, General and Administrative (‘‘SG&A’’) Expenses.    SG&A expenses for the thirteen weeks ended June 30, 2007 decreased $4.4 million to $25.6 million from $30.0 million for the thirteen weeks ended July 1, 2006. The decrease relates primarily to the recording of store servicing and adverting fees for certain customers as a reduction in revenue. In the prior thirteen-weeks ended July 1, 2006, these store servicing and advertising fees were recorded as an expense in SG&A.

Amortization of Intangible Assets.    During the thirteen weeks ended June 30, 2007, we recorded $0.4 million in amortization expense, as compared to $0.5 million during the thirteen weeks ended July 1, 2006.

Interest Expense.    Interest expense for the thirteen weeks ended June 30, 2007 decreased $0.1million to $9.3 million from $9.4 million during the thirteen weeks ended July 1, 2006. The decrease was a result of decrease borrowings under our revolving credit facility.

Income Tax Expense.    Income tax expense for the thirteen weeks ended June 30, 2007 was $1.2 million or approximately 41.5% of income before taxes. Income tax expense for the thirteen weeks ended July 1, 2006 was $2.3 million or approximately 23.5% of income before taxes

Thirty-nine weeks ended June 30, 2007 compared to thirty-nine weeks ended July 1, 2006

Net Sales.    Net sales for the thirty-nine weeks ended June 30, 2007 increased $29.9 million, or 7.7%, to $415.9 million compared to $386.0 million for the thirty-nine weeks ended July 1, 2006. Overall net sales increased primarily from higher sales volumes as a result of the Union and Hound 

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Dog acquisitions, increased sales to certain major retail customers. The increase was offset by the recording of store servicing and advertising fees for certain customers as a reduction in revenue. In the prior thirty-nine weeks ended July 1, 2006, these store servicing and advertising fees were recorded as an expense in SG&A. Recording the store servicing fees as a reduction to revenue was due to a change in the structure of the store servicing arrangements and the excess of the fees over the fair value of the benefit derived from this arrangement with certain customers. Recording the advertising fees as a reduction to revenue was due to the excess of the fees over the fair value derived from the advertising arrangement with certain customers. Additionally, this increase was partially offset by a decrease in snow tools sales due to a lack of snow in certain major geographic markets in the United States and Canada.

Gross Profit.    Gross profit for the thirty-nine weeks ended June 30, 2007 increased $2.8 million to $103.1 million from $100.3 million for the thirty-nine weeks ended July 1, 2006. This increase was due primarily to the increase in sales volume and was offset by the recording of store servicing and advertising fees for certain customers as a reduction in revenue. In the prior thirty-nine weeks ended July 1, 2006, these store servicing fees were recorded as an expense in SG&A. Recording the store servicing fees as a reduction to revenue was due to a change in the structure of the store servicing arrangements and the excess of the fees over the fair value of the benefit derived from this arrangement with certain customers. Recording the advertising fees as a reduction to revenue was due to the excess of the fees over the fair value derived from the advertising arrangement with certain customers. Gross profit as a percentage of net sales decreased to 24.8% from 26.0% during this period due to the mix of products sold and lower levels of production that negatively impacted overhead absorption.

Selling, General and Administrative Expenses.    SG&A expenses for the thirty-nine weeks ended June 30, 2007 increased $1.9 million to $75.5 million from $73.6 million for the thirty-nine weeks ended July 1, 2006. The increase relates primarily to incremental compensation and professional service expenses as a result of the Union acquisition, higher variable selling costs, such as commission and distribution expenses and new product development costs, partially offset by an increase in recoveries under U.S. anti-dumping provisions and the recording of store servicing and advertising fees for certain customers as a reduction in revenue. In the prior thirty-nine weeks ended July 1, 2006, these store servicing and advertising fees were recorded as an expense in SG&A.

Amortization of Intangible Assets.    During the thirty-nine weeks ended June 30, 2007, we recorded $1.1 million in amortization expense, as compared to $1.3 million during the thirty-nine weeks ended July 1, 2006.

Interest Expense.    Interest expense for the thirty-nine weeks ended June 30, 2007 increased $2.7 million to $27.4 million from $24.7 million during the thirty-nine weeks ended July 1, 2006. The increase was a result of borrowings under our revolving credit facility for the Union and Hound Dog acquisitions.

Income Tax Expense.    Income tax expense for the thirty-nine weeks ended June 30, 2007 was $6.6 million. Income tax expense for the thirty-nine weeks ended July 1, 2006 was $1.4 million, or approximately 20.7% of income before taxes. As of September 30, 2006, a deferred tax asset valuation allowance was necessary for a portion of our deferred tax assets. During the thirty-nine weeks ended June 30, 2007, based on revised projections of future taxable income we recorded a valuation allowance of $6.9 million on remaining U.S. federal and state deferred tax assets which are not otherwise offset by reversing deferred tax liabilities.

Liquidity and Capital Resources

Our principal liquidity requirements are to service our debt and meet our working capital and capital expenditure needs. Subject to our performance, which, if adversely affected, could adversely affect the availability of funds, we expect to be able to meet our liquidity requirements for the foreseeable future through cash provided by operations and through borrowings available under our senior secured credit facility. We cannot assure you, however, that this will be the case.

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Contractual Obligations and Commitments

The following table represents our contractual commitments associated with our debt and other obligations as of June 30, 2007.

|                               |  |  |                        |   |         |                            |  |  |                               |   |         |                               |  |  |                               |   |         |                               |  |  |            |   |         |  |  |  |  |   |         |  |  |  |  |   |         |  |  |  |  |   |         |  |
|-------------------------------|--|--|------------------------|---|---------|----------------------------|--|--|-------------------------------|---|---------|-------------------------------|--|--|-------------------------------|---|---------|-------------------------------|--|--|------------|---|---------|--|--|--|--|---|---------|--|--|--|--|---|---------|--|--|--|--|---|---------|--|
|                          |  |  | Total                  |   |         | July2007 to September 2007 |  |  | October 2007 toSeptember 2008 |   |         | October 2008 toSeptember 2009 |  |  | October 2009 toSeptember 2010 |   |         | October 2010 toSeptember 2011 |  |  | Thereafter |
|                          |  |  | (dollars in thousands) |
| Contractual Obligations       |  |  |                   |   |         |                       |  |  |                          |   |         |                          |  |  |                          |   |         |                          |  |  |       |
| Revolving credit facility     |  |  |                        | $ | 67,099  |                            |  |  |                               | $ | 67,099  |                               |  |  |                               | $ | — |                               |  |  |            | $ | — |  |  |  |  | $ | — |  |  |  |  | $ | — |  |  |  |  | $ | — |  |
| Senior Floating Rate Notes    |  |  |                        |   | 150,000 |                            |  |  |                               |   | — |                               |  |  |                               |   | — |                               |  |  |            |   | — |  |  |  |  |   | — |  |  |  |  |   | — |  |  |  |  |   | 150,000 |  |
| Senior Subordinated Notes     |  |  |                        |   | 150,000 |                            |  |  |                               |   | — |                               |  |  |                               |   | — |                               |  |  |            |   | — |  |  |  |  |   | — |  |  |  |  |   | — |  |  |  |  |   | 150,000 |  |
| Term Note                     |  |  |                        |   | 1,724   |                            |  |  |                               |   | 104     |                               |  |  |                               |   | 540     |                               |  |  |            |   | 601     |  |  |  |  |   | 479     |  |  |  |  |   | — |  |  |  |  |   | — |  |
| Interest on Notes             |  |  |                        |   | 145,861 |                            |  |  |                               |   | 13,219  |                               |  |  |                               |   | 27,863  |                               |  |  |            |   | 28,377  |  |  |  |  |   | 28,891  |  |  |  |  |   | 29,040  |  |  |  |  |   | 18,471  |  |
| Operating leases              |  |  |                        |   | 86,652  |                            |  |  |                               |   | 2,421   |                               |  |  |                               |   | 9,612   |                               |  |  |            |   | 9,481   |  |  |  |  |   | 8,476   |  |  |  |  |   | 8,354   |  |  |  |  |   | 48,308  |  |
| Open purchase orders          |  |  |                        |   | 28,819  |                            |  |  |                               |   | 15,712  |                               |  |  |                               |   | 13,071  |                               |  |  |            |   | — |  |  |  |  |   | 36      |  |  |  |  |   | — |  |  |  |  |   | — |  |
| Total contractual obligations |  |  |                        | $ | 630,155 |                            |  |  |                               | $ | 98,555  |                               |  |  |                               | $ | 51,086  |                               |  |  |            | $ | 38,459  |  |  |  |  | $ | 37,882  |  |  |  |  | $ | 37,394  |  |  |  |  | $ | 366,779 |  |
| Commitments                   |  |  |                        |   |    |                            |  |  |                               |   |    |                               |  |  |                               |   |    |                               |  |  |            |   |    |  |  |  |  |   |    |  |  |  |  |   |    |  |  |  |  |   |    |  |
| Outstanding letters of credit |  |  |                        | $ | 3,882   |                            |  |  |                               | $ | 3,882   |                               |  |  |                               | $ | — |                               |  |  |            | $ | — |  |  |  |  | $ | — |  |  |  |  | $ | — |  |  |  |  | $ | — |  |
| Total commitments             |  |  |                        | $ | 3,882   |                            |  |  |                               | $ | 3,882   |                               |  |  |                               | $ | — |                               |  |  |            | $ | — |  |  |  |  | $ | — |  |  |  |  | $ | — |  |  |  |  | $ | — |  |

Cash Flows

Cash provided by operating activities for the thirty-nine week period ended June 30, 2007 was $2.8 million, compared to cash used in operating activities of $27.1 million for the thirty-nine week period ended July 1, 2006. This increase in cash provided by operating activities in fiscal 2007 as compared to fiscal 2006 is primarily the result of a focused effort to reduce inventory in the thirty-nine weeks ended June 30, 2007. This resulted in cash provided by the reduction of inventory of $30.1 million in the thirty-nine week period ended June 30, 2007 as compared to cash used for inventory of $21.1 million in the thirty-nine week period ended July 1, 2006. Cash used in investing activities was $5.6 million and $61.9 million for the thirty-nine week periods ended June 30, 2007 and July 1, 2006, respectively. The decrease in cash used for investing activities from the prior period was due primarily to the acquisitions of Union and Hound Dog during the thirty-nine week period ended July 1, 2006. Cash provided by financing activities was $71.7 for the thirty-nine week period ended July 1, 2006 and cash used in financing activities was $0.1 million for the thirty-nine week period ended June 30, 2007. The decrease was primarily the result of borrowings under the revolving credit facility for the Union and Hound Dog acquisitions in the thirty-nine week period ended July 1, 2006.

Debt and Other Obligations

Senior Secured Credit Facility as Amended and Restated on April 7, 2006

On April 7, 2006, we entered into an amended and restated credit agreement with Bank of America, N.A., as administrative agent, swing line lender and letter of credit issuer, Acorn, Union, and Ames True Temper Properties, Inc. (‘‘ATTP’’); together with the Company, (the ‘‘Borrowers’’), ATT Holding Co., as guarantor, and each lender from time to time thereto (the ‘‘Credit Agreement’’). The Credit Agreement amends and restates our existing credit facility with, among others, Bank of America, N.A. Pursuant to the Credit Agreement, the lenders made available a five-year revolving credit facility of up to $130.0 million, including a sub-facility for letters of credit in an amount not to exceed $15.0 million and a sub-facility for swing-line loans in an amount not to exceed $15.0 million. The Borrowers’ obligations under the credit agreement are guaranteed by ATT Holding Co. The credit facilities will be collateralized by substantially all of our assets, including our domestic subsidiaries, and guaranteed by ATT Holding Co. Future domestic subsidiaries will be required to guarantee the obligations and grant a lien on substantially all of their assets.

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The interest rate applicable to the loans under the senior secured credit agreement is either: (1) the ‘‘Eurodollar Rate’’ plus a margin of 1.8% to 2.8% or (2) the ‘‘Base Rate’’ plus a margin of 0.5% to 1.5%. The initial applicable margin for loans based on the Eurodollar Rate will be 2.3%, and the applicable margin for loans based on the Base Rate will be 1.0%. ‘‘Eurodollar Rate’’ is defined as the London interbank offered rate, adjusted for statutory reserve requirements. The ‘‘Base Rate’’ is the higher of: (1) prime rate publicly announced by Bank of America, N.A. or (2) the Federal Funds effective rate plus 0.5%, adjusted for statutory reserve requirements.

As set forth in the Credit Agreement, the total outstanding amount of all loans and letter of credit obligations under the Credit Agreement shall not exceed the lesser of (1) $130.0 million and (2) the borrowing base, which includes specific percentages of eligible inventory, eligible equipment, eligible accounts receivable and eligible real estate of the Borrowers, minus (b) certain reserves, all as set forth in the Credit Agreement.

The terms of the Credit Agreement include various covenants that restrict our ability to, among other things, incur additional liens, incur additional indebtedness and make additional investments. In addition, the Borrowers are prohibited from incurring capital expenditures exceeding $16.1 million in fiscal year 2007 and $15.0 million in any fiscal year thereafter (subject to the right to carry over the unused portion to the following year). In addition, under certain circumstances the Borrowers will be required to have consolidated earnings before interest, income taxes, depreciation and amortization modified by certain adjustments as defined in the Credit Agreement (‘‘Adjusted EBITDA’’) of at least $41.0 million for any period of four quarters ending on the last day of any fiscal quarter. The Credit Agreement also includes customary events of default, including, without limitation, payment defaults, cross defaults to other indebtedness and bankruptcy related defaults. As of June 30, 2007, we were in compliance with all of our financial covenants. As of June 30, 2007, we had $67.1 million of borrowings on the revolving portion of our senior credit facility, with $3.9 million of letters of credit outstanding. At June 30, 2007, based on the borrowing base calculation, the revolver limit was $130.0 million, with $53.1 million available under the revolving credit facility. In addition, the Company had $0 million and $2.0 million of letters of credit outstanding with another financial institution as of June 30, 2007 and September 30, 2006, respectively. These letters of credit were supported by $2.1 million of restricted cash in the form of an escrow deposit at this financial institution at September 30, 2006.

Senior Subordinated Notes

On June 28, 2004, we completed a private offering of $150.0 million in aggregate principal amount at maturity of 10% Senior Subordinated Notes due July 15, 2012. The Senior Subordinated Notes are fully and unconditionally guaranteed by our parent, ATT Holding Co., on a senior subordinated basis. On August 10, 2004, we filed a registration statement with respect to new notes having substantially identical terms as the original notes, as part of an offer to exchange registered notes for the privately issued original Senior Subordinated Notes. The new notes evidence the same debt as the original Senior Subordinated Notes, are entitled to the benefits of the indenture governing the original Senior Subordinated Notes and are treated under the indenture as a single class with the original notes. The exchange offer was completed on November 24, 2004.

The Senior Subordinated Notes are unsecured senior subordinated obligations and rank behind all of our existing and future senior debt, including borrowings under the senior secured credit facility, equally with any of our future senior subordinated debt, ahead of any of our future debt that expressly provides for subordination to the Senior Subordinated Notes and effectively behind all of the existing and future liabilities of our subsidiaries, including trade payables.

We pay interest on the Senior Subordinated Notes semi-annually in cash, in arrears, on January 15 and July 15 at an annual rate of 10.0%. The indenture governing Senior Subordinated Notes contains various affirmative and negative covenants, subject to a number of important limitations and exceptions, including but not limited to those limiting our ability and the ability of our restricted subsidiaries to borrow money, guarantee debt or sell preferred stock, create liens, pay dividends on or redeem or repurchase stock, make certain investments, sell stock in our restricted 

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subsidiaries, restrict dividends or other payments from restricted subsidiaries, enter into transactions with affiliates and sell assets or merge with other companies.

The indenture governing the Senior Subordinated Notes contains various events of default, including but not limited to those related to non-payment of principal, interest or fees; violations of certain covenants; certain bankruptcy-related events; invalidity of liens; non-payment of certain legal judgments; and cross defaults with certain other indebtedness. We may redeem the Senior Subordinated Notes on or after July 15, 2008, except we may redeem up to 35% of the Senior Subordinated Notes prior to July 15, 2007 with the proceeds of one or more public equity offerings. We are required to redeem the Senior Subordinated Notes under certain circumstances involving changes of control.

Senior Floating Rate Notes

On January 14, 2005, we completed a private offering of $150.0 million principal amount at maturity of our Senior Floating Rate Notes due 2012, which was issued at a 0.5% discount. Net proceeds for the offering were used to repay our Term Loan B in full, repay a portion of our revolving credit facility and pay related fees and expenses. The Senior Floating Rate Notes are fully and unconditionally guaranteed by our parent on a senior unsecured basis. On March 25, 2005 we filed a registration statement with respect to new notes having substantially identical terms as the original notes, as part of an offer to exchange registered notes for the privately issued original Senior Floating Rate Notes. The new notes evidence the same debt as the original Senior Floating Rate Notes, are entitled to the benefits of the indenture governing the original Senior Floating Rate Notes and are treated under the indenture as a single class with the original notes. The exchange offer was completed on May 23, 2005.

The Senior Floating Rate Notes are unsecured, unsubordinated obligations and are effectively subordinated to all of our existing and future secured debt, to the extent of the assets securing such debt, including borrowings under the senior secured credit facility, pari passu with all future senior unsecured indebtedness, senior in right of payment to all existing and future senior subordinated debt, including our Senior Subordinated Notes due 2012, and effectively behind all of the existing and future liabilities of our subsidiaries, including trade payables.

We pay interest on the Senior Floating Rate Notes quarterly in cash, in arrears, on January 15, April 15, July 15 and October 15 at a rate per annum, reset quarterly, equal to LIBOR plus 4.0%, starting on April 15, 2005. The indenture governing the Senior Floating Rate Notes contains various affirmative and negative covenants, subject to a number of important limitations and exceptions, including but not limited to those limiting our ability and the ability of our restricted subsidiaries to borrow money, guarantee debt or sell preferred stock, create liens, pay dividends on or redeem or repurchase stock, make specified types of investments, sell stock in our restricted subsidiaries, restrict dividends or other payments from restricted subsidiaries, enter into transactions with affiliates and sell assets or merge with other companies.

The indenture governing the Senior Floating Rate Notes contains various events of default, including but not limited to those related to non-payment of principal, interest or fees; failure to perform or observe certain covenants; inaccuracy of representations and warranties in any material respect, cross defaults with certain other indebtedness, certain bankruptcy related events, monetary judgment defaults and material non-monetary judgment defaults, ERISA defaults and change of control. We can redeem the Senior Floating Rate Notes, in whole or in part, at any time on or after January 15, 2007. In addition, we may redeem up to 35% of the Senior Floating Rate Notes prior to January 15, 2007 with the net proceeds of one or more public equity offerings. We are required to redeem the Senior Floating Rate Notes under certain circumstances involving changes of control.

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Other Debt

On July 19, 2005, we entered into a $2.7 million Term Note, Loan and Security Agreement and Subordination Agreement with a Lender. This note is payable in monthly installments over five years. The interest rate per annum is equal to 2.5% and secured by certain collateral, which was agreed to by the Administrative Agent of the Senior Secured Credit Facility, as amended and restated. Under the terms of this note, we are required to create 108 jobs at the new manufacturing facility in Pennsylvania within three years of the completion of the facility. The Term Note contains customary events of default (subject to customary exceptions, thresholds and grace periods), including, without limitation, nonpayment of principal, interest, fees and failure to perform or observe certain covenants. As of June 30, 2007, we were in compliance with these covenants.

Interest Rate Swaps

In connection with the issuance of the Senior Floating Rate Notes, we entered into interest rate swaps (the ‘‘Swaps’’) with Bank of America, N.A. and Wachovia Bank, N.A to hedge variable interest rate debt. Pursuant to the Swap with Bank of America, N.A., which became effective on January 17, 2006, we swap 3 month LIBOR rates for fixed interest rates of 4.31% on a notional amount of $100.0 million for the period from January 17, 2006 through January 15, 2008, approximately $66.7 million for the period from January 15, 2008 to January 15, 2009 and approximately $33.3 million for the period from January 15, 2009 through January 15, 2010. Pursuant to the Swap with Wachovia Bank, N.A., effective January 15, 2006, we swap 3 month LIBOR rates for fixed interest rates of 4.29% for a notional amount of $50 million for the period from January 15, 2006 through January 15, 2008, approximately $33.3 million for the period from January 15, 2008 to January 15, 2009 and approximately $16.7 million for the period from January 15, 2009 through January 15, 2010. These swaps fix the variable rate portion of the Senior Floating Rate Notes, while there is an additional margin of 4.00% that is fixed.

The interest rate swaps are accounted for in accordance with Statement of Financial Accounting Standard (‘‘SFAS’’) No. 133 Accounting for Derivative Instruments and Hedging Activities, as amended by SFAS No. 138, Accounting for Certain Derivative Instruments and Certain Hedging Activities and SFAS No. 149, Amendment of Statement 133 on Derivative Instruments and Hedging Activities (collectively, ‘‘SFAS 133’’).  SFAS 133 establishes accounting and reporting standards for derivative instruments and hedging activities.  SFAS 133 requires that all derivatives be recognized as either assets or liabilities at fair value. The Company has accounted for the swaps as cash flow hedges. As of June 30, 2007, the interest rate swaps were recorded as an asset of $2.1million. For the thirty-nine week period ended June 30, 2007, the change in fair value was recognized as a reduction of other comprehensive income of $0.3 million, net of deferred taxes of $0.2 million.

Recent Accounting Pronouncements

In July 2006, the Financial Accounting Standards Board (‘‘FASB’’) issued FASB Interpretation No. 48, ‘‘Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statement No. 109,’’ (FIN 48). FIN 48 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. A two-step process is prescribed whereby the threshold for recognition is a more-likely-than-not test that the tax position will be sustained upon examination based on the technical merits of the position, and the tax position is measured at the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement. FIN 48 is effective for the first quarter of the fiscal year ending September 27, 2008. The Company is currently evaluating what effect, if any, adoption of FIN 48 will have on the Company’s consolidated financial statements.

In September 2006, the FASB issued SFAS No. 157, ‘‘Fair Value Measurements’’, (SFAS 157). SFAS 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (‘‘GAAP’’), and expands disclosures about fair value measurements. The statement applies under other accounting pronouncements that require or permit fair value measurements. Accordingly, SFAS 157 does not require any new fair value measurements. However, 

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for some entities, the application of SFAS 157 will change current practice. This statement is effective for fiscal years beginning after November 15, 2007. The Company is required to adopt SFAS 157 in the first quarter of fiscal year 2009. The Company is currently evaluating what effect, if any, adoption of SFAS 157 will have on the Company’s consolidated financial statements.

In September 2006, the FASB issued SFAS No. 158, ‘‘Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of SFAS statements No. 87, 88, 106 and 132(R)’’, (SFAS 158), to improve financial reporting by requiring an employer to recognize the overfunded or underfunded status of a defined benefit post-retirement plan as an asset or liability was issued. SFAS 158 requires employers to recognize in its changes of financial position the funded status of a benefit plan, measured as the difference between plan assets at fair value and the benefit obligation. For pension plans, the benefit obligation is the projected benefit obligation; for any other post-retirement benefit plan, such as a retiree health care plan, the benefit obligation is the accumulated benefit obligation. If plan assets exceed plan liabilities, an asset would be recognized, and if plan liabilities exceed plan assets, a liability would be recognized. In addition, SFAS 158 requires changes in the funded status of a defined benefit post-retirement plan be recognized in comprehensive income in the year in which the changes occur. SFAS 158 does not change the amount of the expense recorded in a company’s statement of income related to defined benefit post-retirement plans. SFAS 158 is effective for fiscal years ending after June 15, 2007. The Company is currently evaluating what effect, if any, adoption of SFAS 158 will have on the Company’s consolidated financial statements, which will not be determined until the September 29, 2007 measurement date of the assets and benefit obligations of the defined benefit plans.

In September 2006, the Securities and Exchange Commission (SEC) issued Staff Accounting Bulletin (SAB) No. 108, ‘‘Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements,’’ (SAB 108). SAB 108 requires companies to evaluate the materiality of identified unadjusted errors on each financial statement and related financial statement disclosure using both the rollover approach and the iron curtain approach. The rollover approach quantifies misstatements based on the amount of the error in the current year financial statements whereas the iron curtain approach quantifies misstatements based on the effects of correcting the misstatement existing in the balance sheet at the end of the current year, irrespective of the misstatement’s year(s) of origin. Financial statements would require adjustment when either approach results in quantifying misstatement that is material. Correcting prior year financial statements for immaterial errors would not require previously filed reports to be amended. SAB 108 is effective in the fiscal year ending September 29, 2007. The adoption of SAB 108 had no impact on the Company’s consolidated financial statements.

In February 2007, The FASB issued SFAS No. 159, ‘‘The Fair Value Option for Financial Assets and Financial Liabilities, Including an Amendment of FASB Statement No. 115’’ (SFAS 159). SFAS 159 permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. SFAS 159 does not affect any existing accounting literature that requires certain assets and liabilities to be carried at fair value. SFAS 159 is effective for fiscal years beginning after November 15, 2007. The Company has not yet assessed the impact, if any, on its consolidated financial statements of adopting SFAS 159.

Item 3.    Quantitative and Qualitative Disclosures About Market Risk

The Company’s cash flows and earnings are subject to fluctuations resulting from changes in interest rates, foreign currency exchange rates and raw material costs.  We manage our exposure to these market risks through internally established policies and procedures and, when deemed appropriate, through the use of derivative financial instruments. Our policy does not allow speculation in derivative instruments for profit or execution of derivative instrument contracts for which there are no underlying exposures.  We do not use financial instruments for trading purposes and are not a party to any leveraged derivatives.  We monitor our underlying market risk exposures on an ongoing basis and believe that we can modify or adapt our hedging strategies as needed.

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Interest Rate Risk

Our primary market risk is interest rate exposure with respect to our floating rate debt. The interest rate of the Senior Floating Rate Notes at June 30, 2007 was 9.4%. In connection with the offering of the Senior Floating Rate Notes, we entered into two interest rate swaps. These swaps effectively fix the variable interest rate portion of the Senior Floating Rate Notes at notional amounts of $150.0 million for two years beginning January 15, 2006, subsequently amortizing at a rate of $50.0 million per year until the maturity in 2010. The swaps fix the 3 month LIBOR rates at either 4.29% or 4.31% for the duration of the contracts. See ‘‘Management’s Discussion and Analysis of Financial Condition and Results of Operations – Debt and Other Obligations – Senior Floating Rate Notes’’ and ‘‘— Interest Rate Swaps.’’

Foreign Operations; Currency Risk

We conduct foreign operations in Canada and Ireland and utilize international suppliers and manufacturers. As a result, we are subject to risk from changes in foreign exchange rates. These changes result in cumulative translation adjustments, which are included in accumulated other comprehensive income (loss). We do not consider the potential loss resulting from a hypothetical 10% adverse change in quoted foreign currency exchange rates, as of June 30, 2007 to be material. We do not currently manage our foreign exchange risk through the use of derivative instruments.

Raw Material; Commodity Price Risk

We purchase certain raw materials such as resin, steel, and wood that are subject to price volatility caused by unpredictable factors. Where possible, we employ fixed rate raw material purchase contracts and customer price adjustments to help us to manage this risk. We do not currently manage our raw materials risk through the use of derivative instruments.

Item 4.    Controls and Procedures

Evaluation of Controls and Procedures

We maintain a system of disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed by us in reports under Rule 13a-14 of the Securities Exchange Act of 1934, as amended (the ‘‘Exchange Act’’) is accumulated and communicated to management, as appropriate, to allow timely decisions regarding required disclosures. Our management, including the Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period cover by this report. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective in alerting them on a timely basis to information required to be included in our submissions and filings with the SEC.

Changes in Internal Control over Financial Reporting

There have not been any changes in our internal control over financial reporting (as term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the most recent fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II.    OTHER INFORMATION

Item 1.    Legal Proceedings

Not applicable

Item 1A.    Risk Factors

Not applicable

Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds

None

Item 3.    Defaults Upon Senior Securities

None

Item 4.    Submission of Matters to a Vote of Security Holders

None

Item 5.    Other Information

None

Item 6.    Exhibits

|              |  |  |                                                                                                                                                    |
|--------------|--|--|----------------------------------------------------------------------------------------------------------------------------------------------------|
| Exhibit 31.1 |  |  | Certification of Chief Executive Officer Pursuant to Rules 13a-14 and 15d-14, As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
| Exhibit 31.2 |  |  | Certification of Chief Financial Officer Pursuant to Rules 13a-14 and 15d-14, As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
| Exhibit 32.1 |  |  | Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act Of 2002  |
| Exhibit 32.2 |  |  | Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act Of 2002  |

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AMES TRUE TEMPER, INC.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

|                                 |  |  |                                                                        |
|---------------------------------|--|--|------------------------------------------------------------------------|
|                            |  |  | AMES TRUE TEMPER, INC.                                                 |
| Date: August 14, 2007 |  |  | /s/ Richard Dell                                                       |
|                            |  |  | Richard DellChief Executive Officer(Principal Executive Officer)       |
| Date: August 14, 2007 |  |  | /s/ David M. Nuti                                                 |
|                            |  |  | David M. NutiChief Financial Officer(Principal Financial Officer) |

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AMES TRUE TEMPER, INC.

EXHIBIT INDEX

|         |    |    |             |  |  |                                                                                                                                                         |
|---------|----|----|-------------|--|--|---------------------------------------------------------------------------------------------------------------------------------------------------------|
| Exhibit |    |    | Description |
|         | 31 | .1 |             |  |  | Certification of Chief Executive Officer Pursuant to Rules 13a-14 and 15d-14, As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002      |
|         | 31 | .2 |             |  |  | Certification of Chief Financial Officer Pursuant to Rules 13a-14 and 15d-14, As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002      |
|         | 32 | .1 |             |  |  | Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|         | 32 | .2 |             |  |  | Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |

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