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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



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FORM 10-Q



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QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2007

COMMISSION FILE NUMBER 0-10449



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TVI CORPORATION

(Exact name of registrant as specified in its charter)



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|                                                                |  |                                     
|--------------------------------------------------------------- |  | ------------------------------------
|Maryland                                                        |  | 52-1085536                          
|(State or other jurisdiction of incorporation or incorporation) |  | (I.R.S. Employer Identification No.)

7100 Holladay Tyler Road, Glenn Dale, MD 20769

(Address of principal executive offices, including zip code)

(301) 352-8800

(Registrants telephone number, including area code)



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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer or a
non-accelerated filer (as defined in Rule 12b-2 of the Act).

Large Accelerated Filer ̈Accelerated Filer  x    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  x

Indicate the number of shares outstanding of each of the issuers classes of common stock, as of the latest practicable date: 34,169,004 of
Common Stock issued and outstanding as of November 6, 2007.



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TVI CORPORATION

QUARTERLY REPORT ON FORM 10-Q

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2007

TABLE OF
CONTENTS



|                               |  |                                                                                              |  |     
|------------------------------ |  | -------------------------------------------------------------------------------------------- |  | ----
|                               |  |                                                                                              |  | Page
|                               | 
|PART I  FINANCIAL INFORMATION |  | 3                                                                                           
|                               |  |                                                                                             
|Item 1.                        |  | Financial Statements                                                                         |  | 3   
|                               |  |                                                                                             
|                               |  | Consolidated Balance Sheets as of September 30, 2007 and December 31, 2006                   |  | 3   
|                               |  |                                                                                             
|                               |  | Consolidated Statements of Operations for the three months ended September 30, 2007 and 2006 |  | 4   
|                               |  |                                                                                             
|                               |  | Consolidated Statements of Operations for the nine months ended September 30, 2007 and 2006  |  | 5   
|                               |  |                                                                                             
|                               |  | Consolidated Statements of Cash Flows for the nine months ended September 30, 2007 and 2006  |  | 6   
|                               |  |                                                                                             
|                               |  | Notes to Consolidated Financial Statements                                                   |  | 7   
|                               |  |                                                                                             
|Item 2.                        |  | Managements Discussion and Analysis of Financial Condition and Results of Operations        |  | 14  
|                               |  |                                                                                             
|Item 3.                        |  | Quantitative and Qualitative Disclosures about Market Risk                                   |  | 22  
|                               |  |                                                                                             
|Item 4.                        |  | Controls and Procedures                                                                      |  | 22  
|                               | 
|PART II  OTHER INFORMATION    |  | 22                                                                                          
|                               |  |                                                                                             
|Item 1.                        |  | Legal Proceedings                                                                            |  | 22  
|                               |  |                                                                                             
|Item 1A.                       |  | Risk Factors                                                                                 |  | 22  
|                               |  |                                                                                             
|Item 2.                        |  | Unregistered Sales of Equity Securities and Use of Proceeds                                  |  | 30  
|                               |  |                                                                                             
|Item 3.                        |  | Defaults Upon Senior Securities                                                              |  | 30  
|                               |  |                                                                                             
|Item 4.                        |  | Submission of Matters to a Vote of Security Holders                                          |  | 30  
|                               |  |                                                                                             
|Item 5.                        |  | Other Information                                                                            |  | 30  
|                               |  |                                                                                             
|Item 6.                        |  | Exhibits                                                                                     |  | 31  
|                               | 
|SIGNATURES                     |  | 32                                                                                          
|                               | 
|EXHIBIT INDEX                  |  |                                                                                             



2



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PART I  FINANCIAL INFORMATION



|Item 1. | Financial Statements.
|------- | ---------------------

TVI CORPORATION

CONSOLIDATED BALANCE SHEETS

SEPTEMBER 30, 2007 AND DECEMBER 31, 2006

(in thousands, except per share data)



|                                                                                                                                                                       |  |                   |        |   |                  |   |       
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- | ------ | - | ---------------- | - | ------
|                                                                                                                                                                       |  | September 30,2007 |        |   | December 31,2006
|                                                                                                                                                                       |  | (unaudited)       |        |   |                 
|ASSETS                                                                                                                                                                 |  |                   |        |   |                  |   |       
|CURRENT ASSETS                                                                                                                                                         |  |                   |        |   |                  |   |       
|Cash and cash equivalents                                                                                                                                              |  | $                 | 125    |   |                  | $ | 1,757 
|Marketable securities  available for sale                                                                                                                             |  |                   |       |   |                  |   | 2,434 
|Accounts receivable  trade, less allowance for doubtful accounts                                                                                                      |  |                   | 8,535  |   |                  |   | 11,027
|Inventories, net                                                                                                                                                       |  |                   | 5,353  |   |                  |   | 6,226 
|Income taxes receivable                                                                                                                                                |  |                   | 532    |   |                  |   | 1,308 
|Deferred income taxes                                                                                                                                                  |  |                   | 3,203  |   |                  |   | 722   
|Prepaid expenses and other current assets                                                                                                                              |  |                   | 2,073  |   |                  |   | 3,933 
|                                                                                                                                                                       |  |                   |        |   |                  |   |       
|Total current assets                                                                                                                                                   |  |                   | 19,821 |   |                  |   | 27,407
|                                                                                                                                                                       |  |                   |        |   |                  |   |       
|PROPERTY, PLANT AND EQUIPMENT, NET                                                                                                                                     |  |                   | 20,656 |   |                  |   | 18,428
|                                                                                                                                                                       |  |                   |        |   |                  |   |       
|OTHER ASSETS                                                                                                                                                           |  |                   |        |   |                  |   |       
|Goodwill                                                                                                                                                               |  |                   | 6,485  |   |                  |   | 20,932
|Intangible assets, net                                                                                                                                                 |  |                   | 4,670  |   |                  |   | 5,976 
|Deferred income taxes                                                                                                                                                  |  |                   | 2,724  |   |                  |   |      
|Other                                                                                                                                                                  |  |                   | 48     |   |                  |   | 48    
|                                                                                                                                                                       |  |                   |        |   |                  |   |       
|Total other assets                                                                                                                                                     |  |                   | 13,927 |   |                  |   | 26,956
|                                                                                                                                                                       |  |                   |        |   |                  |   |       
|TOTAL ASSETS                                                                                                                                                           |  | $                 | 54,404 |   |                  | $ | 72,791
|                                                                                                                                                                       |  |                   |        |   |                  |   |       
|                                                                                                                                                                       |  |                  
|LIABILITIES AND STOCKHOLDERS EQUITY                                                                                                                                   |  |                   |        |   |                  |   |       
|CURRENT LIABILITIES                                                                                                                                                    |  |                   |        |   |                  |   |       
|Accounts payable, trade                                                                                                                                                |  | $                 | 4,467  |   |                  | $ | 2,209 
|Accrued expenses                                                                                                                                                       |  |                   | 3,834  |   |                  |   | 2,302 
|Deferred income taxes                                                                                                                                                  |  |                   | 76     |   |                  |   |      
|Current portion of long-term debt                                                                                                                                      |  |                   | 2,500  |   |                  |   | 2,500 
|Current portion of non-compete payments                                                                                                                                |  |                   | 276    |   |                  |   | 669   
|                                                                                                                                                                       |  |                   |        |   |                  |   |       
|Total current liabilities                                                                                                                                              |  |                   | 11,153 |   |                  |   | 7,680 
|                                                                                                                                                                       |  |                   |        |   |                  |   |       
|LONG-TERM LIABILITIES                                                                                                                                                  |  |                   |        |   |                  |   |       
|Long-term debt, net of current portion                                                                                                                                 |  |                   | 23,435 |   |                  |   | 24,216
|Non-compete payments, net of current portion                                                                                                                           |  |                   | 781    |   |                  |   | 1,566 
|Deferred income taxes                                                                                                                                                  |  |                   | 1,011  |   |                  |   | 631   
|                                                                                                                                                                       |  |                   |        |   |                  |   |       
|Total long-term liabilities                                                                                                                                            |  |                   | 25,227 |   |                  |   | 26,413
|                                                                                                                                                                       |  |                   |        |   |                  |   |       
|TOTAL LIABILITIES                                                                                                                                                      |  |                   | 36,380 |   |                  |   | 34,093
|                                                                                                                                                                       |  |                   |        |   |                  |   |       
|STOCKHOLDERS EQUITY                                                                                                                                                   |  |                   |        |   |                  |   |       
|Preferred stock  $1.00 par value; 1,200 shares authorized, no shares issued and outstanding as of September 30, 2007 and
December 31, 2006                            |  |                   |       |   |                  |   |      
|Common stock  $0.01 par value; 98,800 shares authorized, 33,876 and 33,174 shares issued and outstanding as of September 30, 2007
and December 31, 2006, respectively |  |                   | 339    |   |                  |   | 332   
|Additional paid-in capital                                                                                                                                             |  |                   | 26,668 |   |                  |   | 25,991
|Retained earnings (accumulated deficit)                                                                                                                                |  |                   | (8,983 | ) |                  |   | 12,375
|                                                                                                                                                                       |  |                   |        |   |                  |   |       
|TOTAL STOCKHOLDERS EQUITY                                                                                                                                             |  |                   | 18,024 |   |                  |   | 38,698
|                                                                                                                                                                       |  |                   |        |   |                  |   |       
|TOTAL LIABILITIES AND STOCKHOLDERS EQUITY                                                                                                                             |  | $                 | 54,404 |   |                  | $ | 72,791
|                                                                                                                                                                       |  |                   |        |   |                  |   |       

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



3



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TVI CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2007 AND 2006

(in thousands, except per share
data)

(unaudited)



|                                                      |  |      |        |   |      |   |        |  
|----------------------------------------------------- |  | ---- | ------ | - | ---- | - | ------ | -
|                                                      |  | 2007 |        |   | 2006 |  
|NET REVENUE                                           |  | $    | 11,820 |   |      | $ | 8,527  |  
|COST OF REVENUE                                       |  |      | 9,297  |   |      |   | 4,142  |  
|                                                      |  |      |        |   |      |   |        |  
|GROSS PROFIT                                          |  |      | 2,523  |   |      |   | 4,385  |  
|                                                      |  |      |        |   |      |   |        |  
|OPERATING EXPENSES                                    |  |      |        |   |      |   |        |  
|Selling, general and administrative expenses          |  |      | 5,407  |   |      |   | 2,364  |  
|Research and development expenses                     |  |      | 294    |   |      |   | 298    |  
|                                                      |  |      |        |   |      |   |        |  
|Total operating expenses                              |  |      | 5,701  |   |      |   | 2,662  |  
|                                                      |  |      |        |   |      |   |        |  
|OPERATING INCOME (LOSS)                               |  |      | (3,178 | ) |      |   | 1,723  |  
|LOSS ON TERMINATION OF JOINT VENTURE AGREEMENT        |  |      |       |   |      |   | 282    |  
|INTEREST AND OTHER EXPENSE (INCOME), NET              |  |      | 664    |   |      |   | (57    | )
|                                                      |  |      |        |   |      |   |        |  
|INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES       |  |      | (3,842 | ) |      |   | 1,498  |  
|PROVISION FOR INCOME TAXES                            |  |      | 93     |   |      |   | 525    |  
|                                                      |  |      |        |   |      |   |        |  
|NET INCOME (LOSS)                                     |  | $    | (3,935 | ) |      | $ | 973    |  
|                                                      |  |      |        |   |      |   |        |  
|EARNINGS (LOSS) PER COMMON SHARE  BASIC              |  | $    | (0.12  | ) |      | $ | 0.03   |  
|                                                      |  |      |        |   |      |   |        |  
|AVERAGE NUMBER OF COMMON SHARES OUTSTANDING  BASIC   |  |      | 33,778 |   |      |   | 32,624 |  
|                                                      |  |      |        |   |      |   |        |  
|EARNINGS (LOSS) PER COMMON SHARE  DILUTED            |  | $    | (0.12  | ) |      | $ | 0.03   |  
|                                                      |  |      |        |   |      |   |        |  
|AVERAGE NUMBER OF COMMON SHARES OUTSTANDING  DILUTED |  |      | 33,778 |   |      |   | 32,930 |  
|                                                      |  |      |        |   |      |   |        |  

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



4



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TVI CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2007 AND 2006

(in thousands, except per share
data)

(unaudited)



|                                                                                     |  |      |         |   |      |   |        |  
|------------------------------------------------------------------------------------ |  | ---- | ------- | - | ---- | - | ------ | -
|                                                                                     |  | 2007 |         |   | 2006 |  
|NET REVENUE                                                                          |  | $    | 38,621  |   |      | $ | 25,095 |  
|COST OF REVENUE                                                                      |  |      | 32,406  |   |      |   | 12,164 |  
|                                                                                     |  |      |         |   |      |   |        |  
|GROSS PROFIT                                                                         |  |      | 6,215   |   |      |   | 12,931 |  
|                                                                                     |  |      |         |   |      |   |        |  
|OPERATING EXPENSES                                                                   |  |      |         |   |      |   |        |  
|Selling, general and administrative expenses                                         |  |      | 16,932  |   |      |   | 7,813  |  
|Research and development expenses                                                    |  |      | 1,430   |   |      |   | 1,180  |  
|                                                                                     |  |      |         |   |      |   |        |  
|Total operating expenses                                                             |  |      | 18,362  |   |      |   | 8,993  |  
|                                                                                     |  |      |         |   |      |   |        |  
|OPERATING INCOME (LOSS)                                                              |  |      | (12,147 | ) |      |   | 3,938  |  
|GOODWILL IMPAIRMENT CHARGE                                                           |  |      | 12,000  |   |      |   |       |  
|LOSS ON TERMINATION OF JOINT VENTURE AGREEMENT                                       |  |      |        |   |      |   | 282    |  
|INTEREST AND OTHER EXPENSE (INCOME), NET                                             |  |      | 1,778   |   |      |   | (169   | )
|                                                                                     |  |      |         |   |      |   |        |  
|INCOME (LOSS) BEFORE PROVISION (BENEFIT) FOR INCOME TAXES                            |  |      | (25,925 | ) |      |   | 3,825  |  
|PROVISION (BENEFIT) FOR INCOME TAXES                                                 |  |      | (4,567  | ) |      |   | 1,451  |  
|                                                                                     |  |      |         |   |      |   |        |  
|INCOME (LOSS) BEFORE NON-CONTROLLING INTEREST IN NET LOSS OF CONSOLIDATED SUBSIDIARY |  |      | (21,358 | ) |      |   | 2,374  |  
|NON-CONTROLLING INTEREST IN NET LOSS OF CONSOLIDATED SUBSIDIARY                      |  |      |        |   |      |   | 4      |  
|                                                                                     |  |      |         |   |      |   |        |  
|NET INCOME (LOSS)                                                                    |  | $    | (21,358 | ) |      | $ | 2,378  |  
|                                                                                     |  |      |         |   |      |   |        |  
|EARNINGS (LOSS) PER COMMON SHARE  BASIC                                             |  | $    | (0.64   | ) |      | $ | 0.07   |  
|                                                                                     |  |      |         |   |      |   |        |  
|AVERAGE NUMBER OF COMMON SHARES OUTSTANDING  BASIC                                  |  |      | 33,491  |   |      |   | 32,604 |  
|                                                                                     |  |      |         |   |      |   |        |  
|EARNINGS (LOSS) PER COMMON SHARE  DILUTED                                           |  | $    | (0.64   | ) |      | $ | 0.07   |  
|                                                                                     |  |      |         |   |      |   |        |  
|AVERAGE NUMBER OF COMMON SHARES OUTSTANDING  DILUTED                                |  |      | 33,491  |   |      |   | 32,996 |  
|                                                                                     |  |      |         |   |      |   |        |  

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



5



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TVI CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2007 AND 2006

(in thousands)

(unaudited)



|                                                                                     |  |      |         |   |      |   |        |  
|------------------------------------------------------------------------------------ |  | ---- | ------- | - | ---- | - | ------ | -
|                                                                                     |  | 2007 |         |   | 2006 |  
|OPERATING ACTIVITIES                                                                 |  |      |         |   |      |   |        |  
|Net income (loss)                                                                    |  | $    | (21,358 | ) |      | $ | 2,378  |  
|Adjustments to reconcile net income (loss) to net cash used in operating activities: |  |      |         |   |      |   |        |  
|Goodwill impairment charge                                                           |  |      | 12,000  |   |      |   |       |  
|Depreciation and amortization                                                        |  |      | 3,703   |   |      |   | 761    |  
|Loss on termination of joint venture agreement                                       |  |      |        |   |      |   | 282    |  
|Write-off of prepaid acquisition costs                                               |  |      |        |   |      |   | 143    |  
|Provision for doubtful accounts                                                      |  |      | 632     |   |      |   | 15     |  
|Deferred income tax benefit                                                          |  |      | (4,749  | ) |      |   | (168   | )
|Non-controlling interest in net loss of consolidated subsidiary                      |  |      |        |   |      |   | (4     | )
|Stock-based compensation expense                                                     |  |      | 272     |   |      |   | 542    |  
|Excess tax benefit from stock-based compensation                                     |  |      |        |   |      |   | (170   | )
|Imputed interest expense associated with non-compete agreements                      |  |      | 247     |   |      |   |       |  
|Earnings on marketable securities reinvested                                         |  |      | (26     | ) |      |   | (104   | )
|Changes in operating assets and liabilities:                                         |  |      |         |   |      |   |        |  
|Accounts receivable, trade                                                           |  |      | 1,860   |   |      |   | 39     |  
|Inventory                                                                            |  |      | 746     |   |      |   | (1,918 | )
|Prepaid expenses and other current assets                                            |  |      | 1,444   |   |      |   | 145    |  
|Income taxes                                                                         |  |      | 776     |   |      |   | (1,241 | )
|Accounts payable, trade                                                              |  |      | 2,258   |   |      |   | (1,263 | )
|Accrued expenses                                                                     |  |      | 1,599   |   |      |   | (474   | )
|                                                                                     |  |      |         |   |      |   |        |  
|Net cash used in operating activities                                                |  |      | (596    | ) |      |   | (1,037 | )
|                                                                                     |  |      |         |   |      |   |        |  
|INVESTING ACTIVITIES                                                                 |  |      |         |   |      |   |        |  
|Purchases of marketable securities                                                   |  |      | (800    | ) |      |   |       |  
|Sales of marketable securities                                                       |  |      | 3,260   |   |      |   | 1,000  |  
|Proceeds from disposal of vehicle                                                    |  |      |        |   |      |   | 12     |  
|Payments on patents                                                                  |  |      | (16     | ) |      |   | (8     | )
|Payments on non-compete agreements                                                   |  |      | (197    | ) |      |   |       |  
|Purchases of property, plant and equipment                                           |  |      | (2,549  | ) |      |   | (1,099 | )
|                                                                                     |  |      |         |   |      |   |        |  
|Net cash used in investing activities                                                |  |      | (302    | ) |      |   | (95    | )
|                                                                                     |  |      |         |   |      |   |        |  
|FINANCING ACTIVITIES                                                                 |  |      |         |   |      |   |        |  
|Net borrowings on line of credit                                                     |  |      | 1,094   |   |      |   |       |  
|Payments on long-term debt                                                           |  |      | (1,875  | ) |      |   |       |  
|Excess tax benefit from stock-based compensation                                     |  |      |        |   |      |   | 170    |  
|Proceeds from exercise of stock options                                              |  |      | 47      |   |      |   | 22     |  
|                                                                                     |  |      |         |   |      |   |        |  
|Net cash provided by (used in) financing activities                                  |  |      | (734    | ) |      |   | 192    |  
|                                                                                     |  |      |         |   |      |   |        |  
|NET DECREASE IN CASH AND CASH EQUIVALENTS                                            |  |      | (1,632  | ) |      |   | (940   | )
|Cash and cash equivalents at beginning of period                                     |  |      | 1,757   |   |      |   | 2,589  |  
|                                                                                     |  |      |         |   |      |   |        |  
|Cash and cash equivalents at end of period                                           |  | $    | 125     |   |      | $ | 1,649  |  
|                                                                                     |  |      |         |   |      |   |        |  

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



6



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TVI CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2007 AND 2006

1. Basis of Presentation.

Organization

TVI Corporation (TVI), a Maryland corporation formed in 1977, together with its subsidiaries (the Company), designs, manufactures, markets and supplies shelter systems, thermal marking devices, and air filtration and
infection control products primarily for homeland security agencies, hospitals, the military, law enforcement agencies and fire departments and public health agencies. The Companys shelter systems include nuclear, biological and chemical
decontamination systems, hospital surge capacity systems and infection control systems, most of which employ the Companys proprietary articulating frame. The Company also designs, manufactures, markets and supplies a line of powered
air-purifying respirators (PAPRs) and also plans to supply disposable filter canisters for the first responder, military, healthcare and industrial markets. In the fourth quarter of 2006, the Company, through its wholly owned subsidiary
Signature Special Event Services, Inc. (SSES), began providing a broad range of temporary infrastructure offerings for traditional special events and for disaster relief.

On October 31, 2006, TVI, through SSES, acquired substantially all of the assets and specified liabilities of Signature Special Event Services, LLC (SSES LLC), a privately-held provider of tent and
related equipment for special events and disaster recovery. On November 8, 2005, TVI acquired Safety Tech International, Inc. (STI), a privately-held supplier of PAPRs. As a result of the acquisition, STI became a wholly owned
subsidiary of TVI.

The Companys headquarters is located in Glenn Dale, Maryland where it manufactures its shelter systems and related products. The
Company also has operations in Frederick, Maryland where it manufactures its PAPRs products. The headquarters of the Companys SSES subsidiary is located in Frederick, Maryland, which also contains SSES administrative offices as well as a
full service equipment, maintenance and manufacturing facility. SSES also has a branch office located in Eldersburg, Maryland where it stores and manufactures its HVAC and mobile kitchen units. Additional branch and administrative offices of SSES
are located in Florida and California.

Operating Segments

The Company determines and discloses its segments in accordance with Statement of Financial Accounting Standards (SFAS) No. 131, Disclosures about Segments of an Enterprise and Related Information (as
amended), which uses a management approach for determining segments. The management approach designates the internal organization that is used by management for making operating decisions and assessing performance as the source
of the Companys reportable segments. For the nine months ended September 30, 2006, the Companys management reporting structure was not organized into reporting segments. During the fourth quarter of 2006, the Company began reporting
in three reporting segments as a result of its acquisitions of STI and SSES, its integration and realignment efforts with respect to these acquisitions, and its filter canister manufacturing line.

The three segments are Shelters and Related Products (shelter systems, surge capacity and infection control systems, command and control systems, and isolation and
thermal products), Personal Protection Equipment (PAPRs and filters) and SSES Rental Services.

Basis of Presentation

The accompanying consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States
(GAAP) for interim financial information. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all material adjustments (consisting of
normal recurring items) considered necessary for a fair presentation have been included. This quarterly report and the accompanying consolidated financial statements should be read in conjunction with the Companys audited financial statements
and notes thereto presented in its Annual Report on Form 10-K for the year ended December 31, 2006 (the 2006 Annual Report). Footnotes which would substantially duplicate the disclosures in the Companys audited financial
statements for the year ended December 31, 2006 contained in the 2006 Annual Report have been omitted. The interim financial information contained in this quarterly report is not necessarily indicative of the results to be expected for any
other interim period or for the full year ending December 31, 2007.

Certain reclassifications have been made to previously reported amounts to
conform to 2007 amounts.



7



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Fair Value of Financial Instruments

The carrying amounts of financial instruments approximate fair value due to the short-term nature of their underlying terms or the variable nature of the interest charged.

Use of Estimates

The preparation of financial statements in
conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period
and related disclosure of contingent liabilities. Actual results could differ from those estimates.

2. Basic and Diluted Earnings Per Share.

Basic earnings per share are calculated using the weighted-average number of common shares outstanding during the period. Diluted earnings per share are
calculated using the weighted-average number of common shares plus dilutive potential common shares outstanding during the period. Potential common shares consist of stock options and convertible preferred stock.

The calculation of the Companys average number of common shares outstanding  diluted for the three and nine months ended September 30, 2007 and
2006 is as follows (in thousands):



|                                                      |  |                                 |  |                                |  |        |  |       
|----------------------------------------------------- |  | ------------------------------- |  | ------------------------------ |  | ------ |  | ------
|                                                      |  | Three Months EndedSeptember 30, |  | Nine Months EndedSeptember 30,
|                                                      |  | 2007                            |  | 2006                           |  | 2007   |  | 2006  
|Average number of common shares outstanding  basic   |  | 33,778                          |  | 32,624                         |  | 33,491 |  | 32,604
|Dilutive effect of stock options                      |  |                                |  | 306                            |  |       |  | 392   
|                                                      |  |                                 |  |                                |  |        |  |       
|Average number of common shares outstanding  diluted |  | 33,778                          |  | 32,930                         |  | 33,491 |  | 32,996
|                                                      |  |                                 |  |                                |  |        |  |       

3. Stock-Based Compensation.

The Company adopted the 1998 Incentive Stock Option Plan (Plan), which provides for non-qualified and incentive stock options to be issued enabling the holder thereof to purchase Common Stock of the
Company at predetermined exercise prices. Incentive stock options may be granted to purchase shares of Common Stock at a price not less than fair market value on the date of grant. Only employees may receive incentive stock options; all other
qualified participants may receive non-qualified stock options with an exercise price determined by the Companys Board of Directors. The Plan also provides for the outright award of shares of Common Stock. The Plan permits the grant of options
and shares for up to 10,000,000 shares of the Companys Common Stock.

As of September 30, 2007, options to purchase up to approximately
2.8 million shares of the Companys Common Stock remain available to be granted under the Plan. The Company believes that such awards better align the interests of employees and others with that of its stockholders. The Plan expires on
May 7, 2008.

Option awards are generally granted with an exercise price equal to the market price of the Companys stock at the date of grant.
Options granted to employees generally have a 10-year contractual term while options granted to directors and others generally have a five-year term. Option awards vest upon terms determined by the Board of Directors. The Company issues new shares
to satisfy its obligations related to the exercise of options.



8



---

The fair values of stock options granted were estimated as of the date of grant using the Black-Scholes-Merton option
pricing model for grants prior to January 1, 2007 and the Binomal option pricing model for grants subsequent to January 1, 2007. The determination was made to change from the Black-Scholes method to the Binomial method to improve the
estimate of fair value. The Black-Scholes-Merton model was originally developed for use in estimating the fair value of traded options, which have different characteristics from TVIs employee incentive and non-qualified stock options. The
model is also sensitive to changes in assumptions, which can materially affect the fair value estimate. The Company used the following assumptions for determining the fair value of options granted under the Binomial and Black-Scholes-Merton option
pricing models for the three and nine months ended September 30, 2007 and 2006, respectively:



|                        |  |                                  |  |                                 |  |                |  |              
|----------------------- |  | -------------------------------- |  | ------------------------------- |  | -------------- |  | -------------
|                        |  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|                        |  | 2007                             |  | 2006                            |  | 2007           |  | 2006         
|Expected volatility     |  | 55.1%                            |  | 39.8% - 58.5%                   |  | 45.9% - 57.8%  |  | 39.8% - 58.5%
|Expected term           |  | 6.25 years                       |  | 3.5 - 5 years                   |  | 5 - 6.25 years |  | 3.5 - 5 years
|Risk-free rate          |  | 4.2%                             |  | 4.58% - 5.14%                   |  | 4.2% - 4.8%    |  | 4.57% - 5.14%
|Expected dividend yield |  | 0.00%                            |  | 0.00%                           |  | 0.00%          |  | 0.00%        

The expected volatility was determined with reference to the historical volatility of the Companys stock.
The Company uses historical data to estimate option exercise and employee termination within the valuation model; separate groups of employees that have similar historical exercise behavior are considered separately for valuation purposes. The
expected term of options granted represents the period of time that options granted are expected to be outstanding; the range given above results from certain groups of employees exhibiting different behavior. The risk-free rate for periods within
the contractual life of the option is based on the U.S. Treasury rate in effect at the time of grant.

Total compensation cost charged to income for
share-based payment arrangements amounted to $0 and $133,000 for the three months ended September 30, 2007 and 2006, respectively, and $272,000 and $542,000 for the nine months ended September 30, 2007 and 2006, respectively. The total
income tax benefit recognized in income for share-based payment arrangements amounted to $50,000 and $23,000 for the nine months ended September 30, 2007 and 2006, respectively. No compensation cost related to share-based payment arrangements
was capitalized as part of inventory or property, plant or equipment.

A summary of the activity under the Plan for the nine months ended
September 30, 2007 is as follows:



|                                                    |  |                         |   |  |                                       |      |                                                 |      |                                 |   |     
|--------------------------------------------------- |  | ----------------------- | - |  | ------------------------------------- | ---- | ----------------------------------------------- | ---- | ------------------------------- | - | ----
|                                                    |  | Numberof Shares (000s) |   |  | WeightedAverageExercisePrice PerShare |      | WeightedAverageRemainingContractualTerm inYears |      | AggregateIntrinsicValue($000s)
|Outstanding as of January 1, 2007                   |  | 1,853                   |   |  | $                                     | 2.69 |                                                 |      |                                 |   |     
|Granted                                             |  | 650                     |   |  |                                       | 0.88 |                                                 |      |                                 |   |     
|Exercised                                           |  | (150                    | ) |  |                                       | 0.33 |                                                 |      |                                 |   |     
|Canceled or expired                                 |  | (886                    | ) |  |                                       | 2.59 |                                                 |      |                                 |   |     
|                                                    |  |                         |   |  |                                       |      |                                                 |      |                                 |   |     
|Outstanding as of September 30, 2007                |  | 1,467                   |   |  |                                       | 2.19 |                                                 | 6.66 |                                 | $ | 0.00
|                                                    |  |                         |   |  |                                       |      |                                                 |      |                                 |   |     
|Vested or expected to vest as of September 30, 2007 |  | 1,264                   |   |  |                                       | 2.34 |                                                 | 6.39 |                                 | $ | 0.00
|                                                    |  |                         |   |  |                                       |      |                                                 |      |                                 |   |     
|Exercisable as of September 30, 2007                |  | 687                     |   |  | $                                     | 3.28 |                                                 | 4.24 |                                 | $ | 0.00
|                                                    |  |                         |   |  |                                       |      |                                                 |      |                                 |   |     

The weighted average grant-date fair value of options granted during the nine months ended September 30, 2007
and 2006 was $0.34 and $1.41, respectively. The total intrinsic value of options exercised during the nine months ended September 30, 2007 and 2006 was $129,000 and $439,000, respectively.

As of September 30, 2007, there was approximately $280,000 of total unrecognized compensation cost related to nonvested share-based compensation arrangements under
the Plan. That cost is expected to be recognized over a weighted-average period of 1.3 years. The total fair value of shares vested during the nine months ended September 30, 2007 and 2006 was approximately $432,000 and $873,000, respectively.

Cash received from option exercises under all share-based payment arrangements for the nine months ended September 30, 2007 and 2006 amounted to
approximately $47,000 and $22,000, respectively. The actual tax benefit realized for the tax deductions from option exercise of the share-based payment arrangements totaled approximately $0 and $170,000 for the nine months ended September 30,
2007 and 2006, respectively.



9



---

Other information regarding options outstanding and exercisable as of September 30, 2007 is as follows:



|                         |  |                     |  |                               |      |                                                  |      |                 |         |                               |   |     
|------------------------ |  | ------------------- |  | ----------------------------- | ---- | ------------------------------------------------ | ---- | --------------- | ------- | ----------------------------- | - | ----
|                         |  | Options Outstanding |  | Options Exercisable          
|Range of Exercise Prices |  | Number ofShares     |  | Weighted-AverageExercisePrice |      | Weighted-AverageRemainingContractualLife inYears |      | Number ofShares |         | Weighted-AverageExercisePrice
|$0.40  0.84             |  | 582,866             |  | $                             | 0.75 |                                                  | 9.68 |                 | 0       |                               | $ | 0.00
|1.21  1.99              |  | 191,668             |  |                               | 1.66 |                                                  | 1.94 |                 | 136,668 |                               |   | 1.53
|2.01  2.98              |  | 162,667             |  |                               | 2.18 |                                                  | 5.05 |                 | 82,001  |                               |   | 2.17
|3.16  3.99              |  | 339,500             |  |                               | 3.63 |                                                  | 5.17 |                 | 295,334 |                               |   | 3.61
|4.00  4.72              |  | 185,000             |  |                               | 4.55 |                                                  | 6.14 |                 | 167,500 |                               |   | 4.60
|5.50                     |  | 5,000               |  |                               | 5.50 |                                                  | 6.93 |                 | 5,000   |                               |   | 5.50
|                         |  |                     |  |                               |      |                                                  |      |                 |         |                               |   |     
|                         |  | 1,466,701           |  | $                             | 2.19 |                                                  | 6.66 |                 | 686,503 |                               | $ | 3.28
|                         |  |                     |  |                               |      |                                                  |      |                 |         |                               |   |     

4. Acquisitions and Pro Forma Financial Information.

Pro Forma Financial Information (Unaudited)

On October 31, 2006
the Company purchased substantially all of the assets of privately-held SSES LLC (the Asset Purchase). The following table presents unaudited pro forma financial information as though the acquisition of SSES LLC took place on
January 1, 2006 (in thousands, except per share data).



|                                                |  |                                     |        |   |                                    |   |        |  
|----------------------------------------------- |  | ----------------------------------- | ------ | - | ---------------------------------- | - | ------ | -
|                                                |  | Three MonthsEndedSeptember 30, 2006 |        |   | Nine MonthsEndedSeptember 30, 2006 |  
|Revenue                                         |  | $                                   | 16,485 |   |                                    | $ | 50,208 |  
|Income (loss) before provision for income taxes |  |                                     | (74    | ) |                                    |   | (48    | )
|Net income (loss)                               |  |                                     | (45    | ) |                                    |   | (25    | )
|                                                |  |                                    
|Earnings (loss) per common share  basic        |  | $                                   | (0.01  | ) |                                    | $ | 0.00   |  
|Earnings (loss) per common share  diluted      |  | $                                   | (0.01  | ) |                                    | $ | 0.00   |  

The above unaudited pro forma financial information has been provided for comparative purposes only and includes
certain adjustments, such as additional amortization expense for identified intangible assets and interest expense on related borrowings. The results are not intended to be indicative of the results of operations that actually would have resulted
had the SSES acquisition been completed on January 1, 2006, or of future results of operations.

5. Inventories, net.

Inventories as of September 30, 2007 and December 31, 2006 consist of (in thousands):



|                 |  |      |       |      |   |      
|---------------- |  | ---- | ----- | ---- | - | -----
|                 |  | 2007 |       | 2006
|Finished goods   |  | $    | 398   |      | $ | 497  
|Work in progress |  |      | 272   |      |   | 849  
|Raw materials    |  |      | 3,831 |      |   | 4,006
|Other            |  |      | 852   |      |   | 874  
|                 |  |      |       |      |   |      
|Total            |  | $    | 5,353 |      | $ | 6,226
|                 |  |      |       |      |   |      

Other inventories consist of field service, demonstration and other sales support inventory. As of
September 30, 2007 and December 31, 2006, inventory reserves for excess and obsolete inventories were approximately $401,000 and $372,000, respectively.

6. Significant Customers.

For the three months ended September 30, 2007, net revenue from the Companys largest customer was from
the SSES Rental Services segment and totaled $1.6 million, or 13.5% of net revenue. For the three months ended September 30, 2006, net revenue from the Companys largest and second largest customers were from the Shelters and Related
Products segment and totaled $1.3 million, or 15.1% of net revenue, and $1.1 million, or 12.5% of net revenue, respectively.



10



---

For the nine months ended September 30, 2007, there were no customers representing more than 10% of net revenue. For
the nine months ended September 30, 2006, net revenue from the Companys largest and second largest customer was from the Shelters and Related Products segment and totaled $4.3 million, or 17.0% of net revenue, and $3.3 million, or 13.2%
of net revenue, respectively.

For three and the nine months ended September 30, 2006, the ultimate distribution of these sales was to multiple
end-users. There were no other customers representing more than 10% of net revenue in either period.

7. Long-Term Debt.

Long-term debt as of September 30, 2007 consists of the following (in thousands):



|                          |  |   |       
|------------------------- |  | - | ------
|Revolving credit facility |  | $ | 23,227
|Acquisition facility      |  |   | 2,708 
|                          |  |   |       
|Total debt                |  |   | 25,935
|Less current portion      |  |   | 2,500 
|                          |  |   |       
|Long-term debt            |  | $ | 23,435
|                          |  |   |       

Credit Agreement with Branch Banking & Trust Company (BB&T). On October 31,
2006, in connection with the acquisition of SSES LLC, the Company and certain of its subsidiaries entered into a financing and security agreement and other related agreements (together and as amended, the Credit Agreement) with BB&T.
The Credit Agreement currently provides for a $25.0 million revolving credit facility (the Revolving Facility) and a $5.0 million acquisition credit facility (the Acquisition Facility and, together with the Revolving
Facility, the Credit Facility). Borrowings under the Acquisition Facility bear interest at LIBOR plus 3.50% and borrowings under the Revolving Facility bear interest at LIBOR plus 3.00%. Borrowings under the Revolving Facility are
additionally capped by a loan base, which is a function of defined levels of eligible accounts receivable, inventory and net fixed assets, and, for the period from May 25, 2007 through and including December 31, 2007, an additional $3.6
million. The Company has little or no borrowing capacity under the Credit Facility.

Among other things, the Credit Agreement requires the Company to
satisfy certain financial covenants. The Company notified BB&T that, for the testing periods ended as of December 31, 2006, March 31, 2007, June 30, 2007 and September 30, 2007, it was not in compliance with two
such financial covenants, which noncompliance, if not waived by BB&T, would each constitute a continuing event of default under the Credit Facility. Upon an event of default of this nature under the Credit Facility, among other things, BB&T
has the right to accelerate the payment of all of the outstanding indebtedness. BB&T granted to the Company a waiver with respect to the noncompliance by the Company with both financial covenants as of December 31, 2006, March 31,
2007, June 30, 2007 and September 30, 2007. There was no effect on the Companys consolidated financial statements as a result of the noncompliance or corresponding grant of waiver by BB&T.

The Credit Agreement also provides that BB&T will issue letters of credit for the Companys account in aggregate undrawn amounts of up to $2.0 million. Annual
fees for letters of credit issued for our account will equal 3.0% of the face amount of such letters of credit. The amount of any outstanding letters of credit issued or committed to be issued by BB&T will reduce, dollar for dollar, the
aggregate amount available under the Revolving Facility. As of September 30, 2007, the Company had one standby letter of credit outstanding with BB&T that was issued in lieu of a performance bond. It was issued on September 6, 2007 in
the amount of $44,470 and expires on June 8, 2008.

8. Segment Reporting.

The Companys reportable segments are: Shelters and Related Products, Personal Protection Equipment and SSES Rental Services. Prior to the acquisition of SSES during the fourth quarter of 2006, the Company had
only one reportable segment. Financial information for the nine months ended September 30, 2006 has been restated to present comparative information. The Company evaluates performance based on income from operations of the respective segments.



11



---

The following are reconciliations of reportable segment revenues, operating income (loss), assets, and other significant
items (in thousands):



|                               |  |                                |         |   |                  |   |       
|------------------------------ |  | ------------------------------ | ------- | - | ---------------- | - | ------
|                               |  | Nine months endedSeptember 30,
|                               |  | 2007                           |         |   | 2006            
|Net revenue:                   |  |                                |         |   |                  |   |       
|Shelters and related products  |  | $                              | 9,675   |   |                  | $ | 20,240
|Personal protection equipment  |  |                                | 4,987   |   |                  |   | 4,855 
|SSES rental services           |  |                                | 23,959  |   |                  |   |      
|                               |  |                                |         |   |                  |   |       
|                               |  | $                              | 38,621  |   |                  | $ | 25,095
|                               |  |                                |         |   |                  |   |       
|Operating income (loss):       |  |                                |         |   |                  |   |       
|Shelters and related products  |  | $                              | (4,451  | ) |                  | $ | 3,574 
|Personal protection equipment  |  |                                | (926    | ) |                  |   | 364   
|SSES rental services           |  |                                | (6,770  | ) |                  |   |      
|                               |  |                                |         |   |                  |   |       
|                               |  | $                              | (12,147 | ) |                  | $ | 3,938 
|                               |  |                                |         |   |                  |   |       
|Depreciation and amortization: |  |                                |         |   |                  |   |       
|Shelters and related products  |  | $                              | 400     |   |                  | $ | 644   
|Personal protection equipment  |  |                                | 234     |   |                  |   | 117   
|SSES rental services           |  |                                | 3,069   |   |                  |   |      
|                               |  |                                |         |   |                  |   |       
|                               |  | $                              | 3,703   |   |                  | $ | 761   
|                               |  |                                |         |   |                  |   |       
|Capital expenditures, gross:   |  |                                |         |   |                  |   |       
|Shelters and related products  |  | $                              | 154     |   |                  | $ | 440   
|Personal protection equipment  |  |                                | 768     |   |                  |   | 659   
|SSES rental services           |  |                                | 1,627   |   |                  |   |      
|                               |  |                                |         |   |                  |   |       
|                               |  | $                              | 2,549   |   |                  | $ | 1,099 
|                               |  |                                |         |   |                  |   |       
|                               | 
|                               |  | As of                         
|                               |  | September 30,2007              |         |   | December 31,2006
|Total assets:                  |  |                                |         |   |                  |   |       
|Shelters and related products  |  | $                              | 12,285  |   |                  | $ | 19,343
|Personal protection equipment  |  |                                | 12,965  |   |                  |   | 23,373
|SSES rental services           |  |                                | 29,154  |   |                  |   | 30,075
|                               |  |                                |         |   |                  |   |       
|                               |  | $                              | 54,404  |   |                  | $ | 72,791
|                               |  |                                |         |   |                  |   |       

9. Intangible Assets

During the three months ended September 30, 2007, the Company terminated an employment agreement with an SSES employee. As a result, the related non-compete intangible and obligation were reduced by $583,000 and $541,000, respectively.

10. Goodwill.

Goodwill is recorded on a business
combination to the extent the cost of an acquired entity exceeds the fair value of the net assets acquired.

The Company does not amortize goodwill but
tests goodwill impairment at least on an annual basis, or earlier when events or changes in circumstances suggest the carrying amount may not be fully recoverable. Such evaluation is performed by comparing the implied fair value of a reporting unit
to its carrying value, including goodwill. An impairment loss is recognized in the current period if the carrying amount of an intangible asset is not recoverable and its carrying amount exceeds its fair value.



12



---

The following table represents the balance as of December 31, 2006 and September 30, 2007 and changes in
goodwill by reporting unit for the nine months ended September 30, 2007 (in thousands):

|                                        |  |     |         |   |      |   |        |       |  |   |         |  
|--------------------------------------- |  | --- | ------- | - | ---- | - | ------ | ----- |  | - | ------- | -
|                                        |  | STI |         |   | SSES |   |        | Total | 
|Balance as of December 31, 2006         |  | $   | 15,602  |   |      | $ | 5,330  |       |  | $ | 20,932  |  
|Reallocation of purchase price          |  |     |        |   |      |   | (2,905 | )     |  |   | (2,905  | )
|Settlement of acquisition contingencies |  |     |        |   |      |   | 416    |       |  |   | 416     |  
|Impairment charge                       |  |     | (12,000 | ) |      |   |       |       |  |   | (12,000 | )
|Termination of Non-Compete Agreement    |  |     |        |   |      |   | 42     |       |  |   | 42      |  
|                                        |  |     |         |   |      |   |        |       |  |   |         |  
|Balance as of September 30, 2007        |  | $   | 3,602   |   |      | $ | 2,883  |       |  | $ | 6,485   |  
|                                        |  |     |         |   |      |   |        |       |  |   |         |  

Goodwill of $15.6 million was recorded in connection with the Companys acquisition of STI on November 8,
2005. STI constitutes a significant portion of our Personal Protection Equipment segment. During the three months ended June 30, 2007, management determined that the revenue expectations used to evaluate the carrying value of goodwill related
to STI in the past were no longer valid. Therefore, management significantly lowered those revenue expectations. As a result, management determined that the goodwill associated with the Personal Protection Equipment segment should be tested for
impairment in accordance with the provisions of SFAS No. 142. An independent business valuation specialist was engaged to assist the Company in the determination of the fair market value of STI within the Personal Protection Equipment segment.
The fair value of STI, determined using both a discounted cash flow analysis and a market multiple analysis, was less than the carrying value. Accordingly, the Company recorded a goodwill impairment charge of $12.0 million, or $0.36 per share
diluted in the second quarter of 2007, related to the goodwill associated with STI within the Personal Protection Equipment segment.

The goodwill
associated with the SSES Rental Services segment was recorded in connection with the Companys acquisition of SSES LLC on October 31, 2006. During the three months ended June 30, 2007, management completed its valuation of assets
purchased in the business combination. As a result, $2.5 million of assets was reclassified to property, plant and equipment which resulted in a corresponding reduction of goodwill and a charge of approximately $345,000 to record depreciation on the
related rental assets from the date of acquisition through June 30, 2007. In addition, $0.4 million was reclassified to the obligations under non-compete agreements during the same period. Also, $1.9 million was recorded as a receivable from
the sellers of SSES LLC in connection with a purchase price adjustment based on the level of SSES LLCs working capital as of the date of the acquisition and acquired past due accounts receivable, which the Company had the right to collect from
the sellers. During the three months ended June 30, 2007, this receivable was settled for $1.5 million, resulting in a $0.4 million increase in the purchase price. For the three months ended September 30, 2007, goodwill related to SSES was
increased $42,000 due to the termination of one of the Companys Non-Compete Agreements. Management expects to perform its first annual impairment test with regard to the carrying value of the goodwill related to this segment as of
October 31, 2007.

11. Deferred Income Taxes

The
components of the deferred tax assets and liabilities at September 30, 2007 and December 31, 2006 are as follows (in thousands):



|                                          |  |      |        |   |      |   |      |  
|----------------------------------------- |  | ---- | ------ | - | ---- | - | ---- | -
|                                          |  | 2007 |        |   | 2006 |  
|Deferred income tax assets - current      |  |      |        |   |      |   |      |  
|Vacation accrual                          |  | $    | 139    |   |      | $ | 137  |  
|Inventory reserve                         |  |      | 198    |   |      |   | 283  |  
|Allowance for doubtful accounts           |  |      | 283    |   |      |   | 45   |  
|Patent amortization                       |  |      |       |   |      |   | 26   |  
|Net operating losses                      |  |      | 1,757  |   |      |   | 196  |  
|Accrued warranty liability                |  |      | 46     |   |      |   | 35   |  
|Prepaid expenses                          |  |      | 780    |   |      |   |     |  
|                                          |  |      |        |   |      |   |      |  
|                                          |  |      | 3,203  |   |      |   | 722  |  
|                                          |  |      |        |   |      |   |      |  
|Deferred income tax assets - long-term    |  |      |        |   |      |   |      |  
|Depreciation and amortization             |  |      | 56     |   |      |   |     |  
|Net operating losses                      |  |      | 4,295  |   |      |   |     |  
|Goodwill impairment                       |  |      | 4,634  |   |      |   |     |  
|                                          |  |      |        |   |      |   |      |  
|                                          |  |      | 8,985  |   |      |   |     |  
|Less valuation allowance                  |  |      | (6,261 | ) |      |   |     |  
|                                          |  |      |        |   |      |   |      |  
|                                          |  |      | 2,724  |   |      |   |     |  
|                                          |  |      |        |   |      |   |      |  
|Deferred income tax liability - current   |  |      |        |   |      |   |      |  
|Inventory reserve                         |  |      | (76    | ) |      |   |     |  
|                                          |  |      |        |   |      |   |      |  
|Deferred income tax liability - long-term |  |      |        |   |      |   |      |  
|Depreciation and amortization             |  |      | (1,011 | ) |      |   | (631 | )
|                                          |  |      |        |   |      |   |      |  
|                                          |  | $    | 4,840  |   |      | $ | 91   |  
|                                          |  |      |        |   |      |   |      |  



13



---

As of September 30, 2007 the Company has recorded a valuation allowance to reduce its deferred income tax assets to
amounts that management considers more likely than not to be realized. During the three months ended June 30, 2007, the deferred tax asset of $4.6 million related to the impairment of goodwill in the Personal Protection Equipment segment was
reduced to $0 because management has no plans to sell the related assets or business, which is the only mechanism under which the tax asset will be realized. During the three months ended September 30, 2007, the deferred tax asset of $3.8
million related to the net operating losses in the SSES Rental Services segment was reduced to $2.2 million since the losses are not available for carryback and the Company has experienced losses in this segment since the date of acquisition.



|ITEM 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations.
|------- | --------------------------------------------------------------------------------------

CAUTIONARY NOTE REGARDING THE USE OF FORWARD-LOOKING

STATEMENTS CONCERNING
OUR BUSINESS

The following section of this report entitled Managements Discussion and Analysis of Financial Condition and
Results of Operations and other sections of this Report contain forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995, which are based on managements expectations,
estimates, projections and assumptions. These statements may be identified by the use of forward-looking words or phrases such as should, believes, expects, might result, anticipates,
projects, estimates and others. These forward-looking statements involve risks and uncertainties and are not guarantees of future performance, as actual results could differ materially from our current expectations.

Such risks and uncertainties include but are not limited to: actions of the Companys lender, our ability to comply with bank
covenants and debt repayment obligations and our ability to obtain future financing on satisfactory terms; achieving the intended benefits of our acquisitions and integrating the operations, technologies, products and services of those businesses;
achieving revenue expectations; unanticipated costs or charges; our ability to meet the requirements of the NASDAQ Capital Market for continued listing of our common stock; adverse consequences from government investigations, lawsuits or private
actions; general economic and business conditions; adverse changes in governmental regulations; the possibility that our products contain unknown defects that could result in product liability claims; and competitive factors in our target markets.
Numerous other factors could cause or contribute to such differences. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as to the date of this report. The Company assumes no obligation to update
any such forward-looking statements even if experience or future changes make it clear that projected results expressed or implied in such statements will not be realized.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our Consolidated Financial
Statements and Notes thereto contained herein.

Overview

We are an international supplier of homeland security, infection control, respiratory and air filtration products for first receivers, such as hospitals, and first responders, such as law enforcement, fire and public
health agencies. We are also a provider of shelter and equipment rental services for special events and disaster relief needs. In November 2005, we acquired Safety Tech International, Inc. (STI), a privately-held supplier of powered air
purifying respirators (PAPRs). As a result of the acquisition, STI became a wholly owned subsidiary of TVI. In October 2006, through our newly-formed subsidiary Signature Special Event Services, Inc. (SSES), we acquired
substantially all of the assets of privately-held Signature Special Event Services, LLC, a leading provider of full-service rental services for traditional special events and for disaster relief with broad temporary infrastructure offerings.



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We design, manufacture, market and supply shelter systems, air filtration systems and infection control
products primarily for homeland security agencies, hospitals, the military, law enforcement agencies and fire departments and public health agencies. Our shelter systems include nuclear, biological and chemical decontamination systems, hospital
surge capacity systems and infection control systems, most of which employ our proprietary articulating frame. We also design, manufacture and market thermal products, including thermal marking devices, primarily to the U.S. military.

We also design, manufacture, market and supply PAPRs through our STI subsidiary, and plan to supply disposable filter canisters for the first responder,
military, healthcare and industrial markets. Subject to first article testing and approval, we anticipate the operational launch of our filter canister manufacturing line in our Glenn Dale, Maryland facility.

We are also a national provider of turn-key equipment and shelter rental services for disaster relief, military, government, industrial, sporting,
hospitality and other special event needs through our SSES subsidiary. With facilities in Maryland, Florida and California, our extensive in-house inventory enables us to address events of significant size and complexity, including large-scale
deployments. In addition, we provide turnkey temporary facilities using our substantial inventory of integrated equipment which includes lighting, mobile kitchens, catering equipment, generators, power distribution and HVAC equipment.

Since the change in our senior Company management in April 2007, we have critically evaluated our operations, overhead, sales and marketing and
integration efforts across our three business segments. We continue to execute our turnaround plan, which highlights higher probability and higher gross margin market opportunities and organizing and managing each of our business segments to operate
more efficiently. Our primary business focus at this time is achieving positive cash flow and operating income.

On August 8, 2007, we
announced the appointment of Harley Hughes as our Chief Executive Officer. On August 29, 2007, we announced the appointment of Sherri Voelkel as our Senior Vice President and Chief Financial Officer, confirmed the appointment of Sean Hunt as
our Senior Vice President and General Counsel and announced the reorganization of our three business segments into distinct operating divisions. As part of the reorganization, we confirmed the appointments of Tom Brown and Dale Kline as the general
managers of our SSES Rental Services and Personal Protection Equipment divisions, respectively, and announced the appointment of Bill Baugh as the general manager of our Shelters and Related Products division. With this reorganization, we delegated
broader authority and profit and loss accountability to each general manager. We believe that this organizational structure motivates each divisions management to be more focused on product quality, features and functions, be more diligent in
qualifying sales opportunities and be more efficient managing business operations.

Across all of our business segments, we are
establishing a product focused sales model with an emphasis on direct contact with the end customer. With respect to our Shelters and Related Products segment, we have restored and enhanced our sales organization by hiring experienced industry
professionals who can establish and build relationships within our sales channels. With respect to our Personal Protection Equipment segment, we continue to focus on our OEM sales while also conducting an orderly development of a distributor sales
model. With respect to our SSES Rental Services segment, we continue to focus on pricing and costing discipline and integrating the SSES Rental Services business, including consolidating the former Kentucky and North Carolina branches into the
Maryland and Florida branches. Across all of our business segments, these initiatives, among others, have resulted in higher gross margins for the third quarter of 2007 compared to the second quarter of 2007.

In addition to the operational and other initiatives outlined above, we continue to consider a number of alternatives to increase cash flow, to reduce
our indebtedness to our senior secured creditor, and to focus on actions we believe offer the best prospects for restoring the Company to profitability. Initiatives we may consider include both short-term and long-term measures intended to enhance
our overall prospects for achieving these goals. At this time, however, the Board of Directors does not believe that a sale of the entire Company would be in the best interest of the Company, our stockholders and other constituencies, and such a
sale is, therefore, not one of the initiatives currently under consideration. The Company further cautions that the consideration of any initiative may not result in any transaction and undertakes no obligation to disclose consideration of any
initiative unless and until the Board of Directors makes a final decision regarding a specific initiative that would result in a material transaction.

Segments and Product Lines

TVI is organized into three reportable business segments reflecting our broad product and
service offerings realized from our acquisitions of STI and SSES and our filter canister manufacturing line. These segments are Shelters and Related Products (shelter systems, surge capacity and infection control systems and command and control
systems and our isolation and thermal products), Personal Protection Equipment (PAPRs and filters) and SSES Rental Services. For additional



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information relating to our reportable segments, including comparable segment data for prior periods, refer to Note 17 in the Notes to Consolidated
Financial Statements in the Companys 2006 Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 15, 2007.

Results of Operations for the Three Months Ended September 30, 2007 Compared With the Three Months Ended September 30, 2006

Net Revenue:

Net revenue increased $3.3 million, or 38.6%, to $11.8 million for the third quarter of 2007, from $8.5
million for the third quarter of 2006. Net revenue in each of our operating segments during the three months ended September 30, 2007 and 2006 was as follows:



|                              |  |               |      |      |   |    
|----------------------------- |  | ------------- | ---- | ---- | - | ---
|Segment                       |  | 2007          |      | 2006
|                              |  | (in millions)
|Shelters and Related Products |  | $             | 3.7  |      | $ | 7.1
|Personal Protection Equipment |  |               | 1.7  |      |   | 1.4
|SSES Rental Services          |  |               | 6.4  |      |   |   
|                              |  |               |      |      |   |    
|                              |  | $             | 11.8 |      | $ | 8.5
|                              |  |               |      |      |   |    

The increase in consolidated net revenue is primarily attributable to $6.4 million of revenue from
our SSES Rental Services segment, which we acquired during the fourth quarter of 2006. This increase was offset by a decrease in revenue in our Shelters and Related Products segment of $3.4 million, or 48%. The decrease in revenue in our Shelters
and Related Products segment was primarily due to (a) continuing effects from the poor sales management and execution by former management and (b) disruption of our sales force resulting from distraction of our former senior management in
connection with then-pending investigations of their conduct.

Gross Profit:

Gross profit decreased $1.9 million, or 43.2%, to $2.5 million for the third quarter of 2007, compared with $4.4 million for the third quarter of 2006.
Gross margin as a percentage of sales was 21.3% for the third quarter of 2007 compared with 51.4% for the third quarter of 2006. The decrease in the gross margin percentage in the third quarter of 2007 incorporates the operating results of our SSES
Rental Services segment, which generally has significantly lower gross margins than the historical gross margins of our other business segments. Moreover, significantly lower revenue from our Shelters and Related Products segment resulted in lower
gross margins for the segment given the level of fixed manufacturing costs.

Selling, General and Administrative:

Selling, general and administrative (SG&A) expense was $5.4 million for the third quarter of 2007, an increase of $3.0 million, or 125%,
compared with $2.4 million for the third quarter of 2006. The increase is primarily attributable to the added SG&A expense of approximately $2.7 million from our SSES Rental Services segment, offset in part by decreases in general office
expenses, sales commissions and stock option expense.

Research and Development:

Research and development (R&D) expense was $294,000 for the third quarter of 2007, which was essentially unchanged from $298,000 for the
third quarter of 2006. R&D expense is comprised primarily of development efforts related to our Personal Protection Equipment segment.

Operating
Income (Loss):

We had an operating loss of $3.2 million for the third quarter of 2007, compared to operating income of $1.7 million for
the third quarter of 2006, primarily reflecting a decline in gross profit and the additional SG&A expense of our SSES Rental Services segment. Operating loss was 26.9% of net revenue for the third quarter of 2007, compared to operating income
equal to 20.2% of net revenue for the third quarter of 2006.

Income Tax Expense (Benefit):

We had an income tax benefit which was negatively impacted by a $1.6 million valuation allowance on the net operating losses generated in our SSES Rental
Services segment resulting in an income tax expense of $93,000.



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Net Income (Loss):

We had a net loss of $3.9 million for the third quarter of 2007, compared with net income of $973,000 for the third quarter of 2006, reflecting the matters set forth above. Loss per diluted share was $0.12 for the
third quarter of 2007, compared with income per diluted share of $0.03 for the third quarter of 2006.

Results of Operations for the Nine Months ended
September 30, 2007 Compared With the Nine Months Ended September 30, 2006

Net Revenue:

Net revenue increased $13.5 million, or 53.8%, to $38.6 million for the nine months ended September 30, 2007, from $25.1 million for the nine months
ended September 30, 2006. Net revenue in each of our operating segments during the nine months ended September 30, 2007 and 2006 was as follows:



|                              |  |               |      |      |   |     
|----------------------------- |  | ------------- | ---- | ---- | - | ----
|Segment                       |  | 2007          |      | 2006
|                              |  | (in millions)
|Shelters and Related Products |  | $             | 9.7  |      | $ | 20.2
|Personal Protection Equipment |  |               | 5.0  |      |   | 4.9 
|SSES Rental Services          |  |               | 23.9 |      |   |    
|                              |  |               |      |      |   |     
|                              |  | $             | 38.6 |      | $ | 25.1
|                              |  |               |      |      |   |     

The increase in consolidated net revenue is primarily attributable to $23.9 million of revenue
from SSES Rental Services, which was acquired during the fourth quarter of 2006. This increase was offset by a decrease in revenue in our Shelters and Related Products segment of $10.5 million, or 52%, which was primarily due to (a) continuing
effects from poor sales management and execution by former management and (b) disruption of our sales force resulting from distraction of our former senior management in connection with then-pending investigations of their conduct.

Gross Profit:

Gross profit decreased $6.7
million, or 51.9%, to $6.2 million for the nine months ended September 30, 2007, compared with $12.9 million for the nine months ended September 30, 2006. Gross margin as a percentage of net revenue was 16.1% for the nine months ended
September 30, 2007, compared with 51.5% for the nine months ended September 30, 2006. The decrease in the gross margin percentage in the nine months ended September 30, 2007 incorporates the operating results of our SSES Rental
Services segment, which generally has significantly lower gross margins than the historical gross margins of our other business segments. In addition, our SSES Rental Services segment experienced project cost overruns during the nine month period
and an additional depreciation charge during the second quarter of $345,000 as explained more fully in note 9 to the notes to the unaudited consolidated financial statements included in this report. Moreover, significantly lower revenue from our
Shelters and Related Products segment during the nine month period resulted in lower gross margins for the segment given the level of fixed manufacturing costs.

Selling, General and Administrative:

SG&A expense was $16.9 million for the nine months ended September 30, 2007,
an increase of $9.1 million, or 117%, compared with $7.8 million for the nine months ended September 30, 2006. The increase is primarily attributable to the added SG&A expense of approximately $7.0 million from our SSES Rental Services
segment and higher legal and professional services costs of approximately $1.5 million, incurred primarily in connection with investigations and corporate governance matters, and cooperation with government authorities regarding ongoing inquiries
and investigations of certain transactions and matters and litigation that was dismissed during the second quarter of 2007.

Research and Development:

R&D expense was $1.4 million for the nine months ended September 30, 2007, an increase of $200,000, or 17%, compared with $1.2
million for the nine months ended September 30, 2006. R&D expense is comprised primarily of development efforts related to our Personal Protection Equipment segment.

Operating Income (Loss):

We had an operating loss of $12.1 million for the nine months ended
September 30, 2007, compared to operating income of $3.9 million for the nine months ended September 30, 2006, primarily reflecting the decline in gross profit and the additional SG&A expense of our SSES Rental Services segment.
Operating loss was 31.3% of net revenue for the nine months ended September 30, 2007, compared to operating income equal to 15.5% of net revenue for the nine months ended September 30, 2006.



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Goodwill Impairment:

During the second quarter of 2007, the Company recorded a goodwill impairment charge of $12.0 million related to the goodwill associated with STI within our Personal Protection Equipment segment. The resulting $4.6
million deferred tax asset was reduced to $0 due to application of a 100% deferred tax valuation allowance. After this goodwill impairment charge, the Company has remaining goodwill of $3.6 million related to the Personal Protection Equipment
segment and $2.9 million related to the SSES Rental Services segment. The Company does not amortize goodwill but tests goodwill for impairment at least on an annual basis, or earlier when events or changes in circumstances suggest the carrying
amount may not be fully recoverable. Such evaluation is performed by comparing the implied fair value of a reporting unit to its carrying value, including goodwill. An impairment loss is recognized in the current period if the carrying amount of an
intangible asset is not recoverable and its carrying amount exceeds its fair value.

Prior to the second quarter of 2007, the
Companys internal financial projections for STI within its Personal Protection Equipment segment were based on former managements belief that STI was successfully transitioning to a distribution sales model. Based on its prior internal
projections and STIs performance prior to the second quarter of 2007, the Company determined that the goodwill associated with STI was not impaired. However, during the second quarter of 2007 management determined that the revenue expectations
used to evaluate the carrying value of goodwill of STI were no longer valid. Therefore, management significantly lowered those revenue expectations. The Companys process for the goodwill impairment charge relating to STI is further explained
in note 9 to the notes to the unaudited consolidated financial statements included in this report.

The Company believes that its current
plans of reestablishing OEM sales at STI as part of an orderly transition to a distribution sales model will result in higher revenue within the Personal Protection Equipment segment. For purposes of determining the carrying value of goodwill
related to STI, however, internal projections are based on known or foreseeable sources of revenue, and the Company cannot predict if its revised strategy will result in revenue equal to or greater than the Companys revised revenue
expectations.

Management expects to perform its first annual impairment test with regard to the carrying value of the goodwill related to
its SSES Rental Services segment as of October 31, 2007.

Income Tax Expense (Benefit):

The effective tax rate (EFT) for the nine months ended September 30, 2007 was 21.4%, compared with 37.9% for the nine months ended
September 30, 2006. The decrease in the EFT is primarily attributable to the 100% valuation allowance on the goodwill impairment charge related to the goodwill associated with STI within our Personal Protection Equipment segment, as well as a
valuation allowance related to the net operating losses generated by our SSES Rental Services segment.

Net Income (Loss):

We had a net loss of $21.4 million for the nine months ended September 30, 2007, compared with net income of $2.4 million for the nine months ended
September 30, 2006, reflecting the matters set forth above. Loss per diluted share was $0.64 for the nine months ended September 30, 2007, compared with income per diluted share of $0.07 for the nine months ended September 30, 2006.

Liquidity and Capital Resources

Management measures our liquidity on the basis of our ability to meet short-term and long-term operational funding needs and to fund critical investments. Significant factors affecting the management of liquidity are cash flows from
operating activities, access to bank lines of credit, capital expenditures and our ability to attract long-term capital under satisfactory terms.

TVI and certain of its subsidiaries are party to a financing and security agreement and other related agreements (together, the Credit Agreement) with Branch Banking and Trust Company (BB&T). The Credit
Agreement, as amended, currently provides for a $25.0 million revolving credit facility (the Revolving Facility) and a $5.0 million term acquisition credit facility (the Acquisition Term Facility) (the Revolving Facility and
the Acquisition Term Facility, collectively, the Credit Facility). Borrowings under the Revolving Facility are additionally capped by a loan base amount (the Borrowing Base), which is a function of defined levels of eligible
accounts receivable, inventory and net fixed assets plus, for the period through December 31, 2007 (the Override Period), an amount equal to $3.6 million. Other than



18



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increases in the Borrowing Base, if any, our borrowing capacity under the Credit Facility during the Override Period will continue to be limited to cash
receipts other than from collection of eligible accounts receivable. We are monitoring our cash position on a daily basis and are limiting our capital and other expenditures at this time. We have little or no borrowing capacity under the Credit
Facility. For additional information regarding the Credit Facility and the Companys borrowing ability under the facility see the discussion of the Financing and Security Agreement with BB&T below.

As of September 30, 2007, working capital was $8.7 million, down from $19.7 million at December 31, 2006. Cash and cash equivalents and
marketable securities available for sale as of September 30, 2007 totaled $125,000, a decrease of 97% from December 31, 2006. Working capital changes are primarily attributable to the decrease in cash and cash equivalents and marketable
securities of $4.1 million and the increase in accounts payable and accrued expenses of $4.1 million.

Accounts receivable as of
September 30, 2007 were $8.5 million, a decrease of $2.5 million, or 22.7%, from $11.0 million as of December 31, 2006. Days-sales outstanding, or DSO, as of September 30, 2007 was 74 days compared to 71 days as of December 31,
2006. The decrease in accounts receivable is primarily attributable to collections of receivables outstanding at December 31, 2006 in excess of new receivables. The increase in DSO and the corresponding increase in past due accounts receivable
are primarily attributable to three overdue accounts. Generally, we provide net 30 payment terms to our customers. However, receipt of payments from international and governmental entities is often delayed and the collection of our receivables from
these customers can require extra effort and expense. The collection delays have a direct short-term impact on the amount of cash provided by operations during our reporting periods. The following table reflects additional information related to our
accounts receivable as of September 30, 2007 (in thousands):



|                                                         |  |                                   |     |              |   |                  |  |   |      
|-------------------------------------------------------- |  | --------------------------------- | --- | ------------ | - | ---------------- |  | - | -----
|                                                         |  | Accounts Receivable Days Past Due
|                                                         |  | 61  90Days                       |     | 91  120Days |   | 121 Daysand Over
|Outstanding as of September 30, 2007                     |  | $                                 | 328 |              | $ | 660              |  | $ | 1,344
|Collected through October 31, 2007                       |  |                                   | 87  |              |   | 242              |  |   | 218  
|Allowance for doubtful accounts as of September 30, 2007 |  |                                   | 23  |              |   | 147              |  |   | 551  

Inventory as of September 30, 2007 was $5.4 million, a decrease of 14% from December 31,
2006. Annualized inventory turnover was 2.4 times as of September 30, 2007, compared to 3.4 times for the year ended December 31, 2006. The decrease in inventory primarily consisted of $925,000 in our Shelters and Related Products segment
inventory, which was the result of selling on-hand finished goods and utilizing our raw material for completion of orders received, offset by increases of approximately $150,000 in our Personal Protection Equipment segment and an increase in
marketing demonstration inventory related to purchases of trailers and shelters for surge demonstrations for our Shelters and Related Products segment. The decrease in inventory turnover is due to the rate of decrease in our sales volume being
greater than the rate of decrease in our inventory balance. Our marketing demonstration inventory is excluded from the calculation of our inventory turnover. In addition, we record a reserve against our inventory and we amortize our marketing
demonstration inventory over its three year estimated useful life to reduce the amounts to the estimated lower of cost or market value. Our reserve for slow-moving and obsolete inventory has increased by $29,000 since December 31, 2006.

Current liabilities as of September 30, 2007 were $11.2 million, an increase of 45.2% from December 31, 2006. This increase was
primarily attributable to an increase in accounts payable resulting from the timing of payments to our vendors and increases in customer deposits and sales taxes payable related to the SSES Rental Services segment.

Cash used in operating activities was $596,000 for the nine months ended September 30, 2007, compared $1.0 million for the nine months ended
September 30, 2006. Cash used by investing activities totaled $302,000 for the nine months ended September 30, 2007, primarily from the purchases of $2.5 million of property, plant and equipment and the payment of non-compete obligations
of $197,000, offset by a net $2.5 million reduction in marketable securities, compared to cash used in investing activities of $95,000 for the nine months ended September 30, 2006, primarily for the purchase of engineering lab equipment and
construction of the filter line, offset by the sale of marketable securities. Cash used in financing activities totaled $734,000 for the nine months ended September 30, 2007 primarily due to payments on outstanding debt under the Credit
Facility.

Financing and Security Agreement with Branch Banking & Trust Company. On October 31, 2006, in connection
with our acquisition of Signature Special Event Services, LLC, TVI and certain of its subsidiaries entered the Credit Agreement with BB&T. The Credit Agreement, as amended, currently provides for a $25.0 million Revolving Facility and a $5.0
million Acquisition Term Facility, which together comprise the Credit Facility. Borrowings under the Revolving Facility are additionally capped by the Borrowing Base. Borrowings under the Acquisition Term Facility bear interest at a rate equal to
LIBOR plus 3.5% and borrowings under the Revolving Facility bear interest at a rate equal to LIBOR plus 3.0%.



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The Credit Agreement also provides that BB&T will issue letters of credit for our account in
aggregate undrawn amounts of up to $2.0 million. Annual fees for letters of credit issued for our account will equal 3.0% of the face amount of such letters of credit. The amount of any outstanding letters of credit issued or committed to be issued
by BB&T will reduce, dollar for dollar, the aggregate amount available under the Revolving Facility.

The obligations under the Credit
Agreement are secured by a first priority security interest in substantially all of the assets of TVI and certain of its subsidiaries.

The
Credit Agreement contains customary covenants that, among other things, limit our ability to incur additional indebtedness, create liens, pay dividends, make certain types of investments, make certain capital expenditures, sell assets, merge with
other companies or enter into certain other transactions outside of the ordinary course of business. Among other things, the Credit Agreement requires us to maintain a ratio of EBITDAR (EBITDA plus real property rent or lease expense) to debt
service on a consolidated basis of 1.3 to 1.0 or more on a rolling four quarter basis and a ratio of funded debt to EBITDA on a consolidated basis of 3.0 to 1.0 or less on a rolling four quarter basis (together, the Financial Covenant
Requirements). We have notified BB&T that for the testing periods ended as of December 31, 2006, March 31, June 30 and September 30, 2007 we were not in compliance with the Financial Covenant Requirements
(Financial Covenant Requirements Noncompliance) which noncompliance, if not waived by BB&T, would constitute a continuing event of default under the Credit Facility. Upon an event of default of this nature, among other things,
BB&T has the right to accelerate the payment of all of the outstanding indebtedness under the Credit Facility. BB&T has granted to us waivers with respect to the Financial Covenant Requirements Noncompliance for the testing periods ended as
of December 31, 2006, March 31, June 30 and September 30, 2007.

We executed with BB&T the First Amendment to
Financing and Security Agreement as of May 25, 2007 (the First Amendment). Among other things, the First Amendment (i) temporarily increased the Borrowing Base by $2.3 million from May 25, 2007 through June 25, 2007,
(ii) created a reserve against the Borrowing Base in an amount equal to all advances under an acquisition revolving facility then available under the Credit Facility (Acquisition Revolving Facility) which, as of May 25, 2007,
was $5.0 million, and (iii) increased the interest rate on LIBOR rate borrowings under the Revolving Facility and Acquisition Revolving Facility to LIBOR plus 3.00% (from LIBOR plus a stated margin of between 1.25% and 2.25%).

We executed with BB&T the Second Amendment to Financing and Security Agreement as of June 21, 2007 (the Second Amendment). Among
other things, the Second Amendment (i) extended the temporary increase in the Borrowing Base of $2.3 million from June 25, 2007 through August 23, 2007 and (ii) provided for an advance of $5.0 million under the Revolving Facility
to repay the Acquisition Revolving Facility in full and terminated BB&Ts commitment to make further advances under the Acquisition Revolving Facility.

We executed with BB&T the Third Amendment to Financing and Security Agreement as of August 7, 2007 (the Third Amendment). Among other things, the Third Amendment (i) extended the temporary
increase in the Borrowing Base of $2.3 million through November 10, 2007 and (ii) changed the interest rate under the Acquisition Term Facility from LIBOR plus a stated margin of 2.25% to LIBOR plus a stated margin of 3.50%.

We executed with BB&T the Fourth Amendment to Financing and Security Agreement as of October 12, 2007 (the Fourth Amendment). Among
other things, the Fourth Amendment extended the temporary increase in the Borrowing Base from $2.3 million to $3.6 million through November 10, 2007.

We executed with BB&T the Fifth Amendment to Financing and Security Agreement as of November 7, 2007 (the Fifth Amendment) (the First Amendment, the Second Amendment, the Third Amendment, the
Fourth Amendment and the Fifth Amendment are collectively the Amendments). Among other things, the Fifth Amendment (i) extended the temporary increase in the Borrowing Base of $3.6 million through December 31, 2007 and
(ii) caused the percentage of eligible fixed assets applicable to the calculation of the Borrowing Base to be fixed at 65% rather than 55% through December 31, 2007.

Except for these Amendments, the terms of the Credit Agreement are unchanged. In particular, the Amendments do not modify or amend the Financial Covenant
Requirements, the unwaived breach of which, among other things, would permit BB&T to accelerate the payment of all of the outstanding indebtedness under the Credit Facility. During the Override Period we hope to pursue an agreement with BB&T
to restructure the Credit Facility. As part of this process, we presented to BB&T the results of our internal business analysis as required by the First Amendment and continue to provide financial and business information to BB&T. Although
we hope to restructure the Credit Facility during the Override Period, we can give no assurance that we will be successful in this regard. Any restructuring of the Credit Facility may require us to engage in asset sales and/or other activities
designed to generate cash to reduce the portion of the Credit Facility that is not currently collateralized.



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Other than increases in the Borrowing Base, if any, our borrowing capacity under the Credit Facility
during the Override Period will be limited to our cash receipts other than from collection of eligible accounts receivable, which reduces the Borrowing Base. We have little or no borrowing capacity under the Credit Facility.

We pay a monthly fee equal to an annual rate of 0.30% of the unused Revolving Facility.

Interest is payable monthly on amounts borrowed under the Revolving Facility with principal and accrued interest due and payable in full on
September 30, 2011. Borrowings under the Acquisition Term Facility are to be repaid in 24 monthly payments of principal and interest. The Credit Agreement provides that any advances available under the Revolving Facility can be used only for
working capital purposes. As of September 30, 2007, amounts borrowed under the Credit Facility were $24.9 million.

We believe that we
have adequate production equipment to support our current level of operations. In our Shelters and Related Products and Personal Protection Equipment segments we spent $919,000 on plant and equipment in the nine months ended September 30, 2007
and $2.0 million in the year ended December 31, 2006. These purchases primarily related to the filter canister manufacturing line and other product expansion initiatives. We may have a need to invest in additional equipment to meet efficiency
and delivery requirements should our production levels increase significantly; however, we can give no assurance that funds will be available for these purposes. Additionally, we spent $1.7 million since October 31, 2006 (the date of
acquisition) on capital expenditures for new rental inventory and refurbishing costs for existing rental inventory for our SSES Rental Services segment. We currently intend to purchase any such equipment from operating funds to the extent available;
however, we may use funds drawn under the Credit Facility to make such purchases, subject to the availability of such funds under the Credit Facility. Our current cash and liquidity position significantly limits our ability to make capital
expenditures at this time.

Incentive Bonus Program. We have entered into an Incentive Bonus Program (the Program) that
covers two senior SSES employees who have employment agreements (together, the Participants); we have terminated the Program with one former SSES employee. The Program consists of an annual bonus based on EBITDA (the EBITDA
Bonus), and a separate three-year bonus based on the Companys return on invested capital related to its acquisition of SSES LLC, payable in 2010 (the Return on Invested Capital Bonus). Any bonus earned under the Program may
be paid in any combination of cash and shares as the Company shall elect, provided that at least 35% of each payment must be in cash and each of the Participants will be entitled to receive one-third of any bonus that becomes payable.

The Participants collectively will be eligible to receive an annual EBITDA Bonus, if any, for each of 2007, 2008 and 2009 equal to 33.3% of EBITDA for
the acquired business for such year in excess of $3.5 million. Any EBITDA Bonus will be paid within 120 days of the applicable year-end.

The Participants also will be eligible to receive a Return on Invested Capital Bonus payment in 2010 based upon the average quarterly EBIT return for the acquired business measured over a three-year performance period from January 1,
2007 through December 31, 2009 in excess of a hurdle rate. Specifically, the Participants will be entitled to receive a multiple of 6.6x of one-half of any Excess EBIT Return (before the Participants EBITDA Bonus) for 2007  2009.
Excess EBIT Return means a dollar amount obtained by multiplying the difference, if any, by which the actual 2007  2009 EBIT ratio exceeds a 15% EBIT hurdle ratio times total invested capital (i.e., the adjusted purchase price for SSES,
as adjusted for 2007  2009 changes in net working capital and net fixed assets).

Each Participant will be entitled to receive
one-third of any Return on Invested Capital Bonus that becomes payable, which may be payable in whole or in part in the Company common stock, which vests over two years.

The total number of shares of the Companys common stock issuable to the Participants under the Program, together with any shares issuable to the Participants under any other plan or program of the Company or
SSES, shall not exceed 19.9% of the total number of the Companys shares issued and outstanding as of the closing of the Asset Purchase.

Critical
Accounting Policies and Estimates

Note 2 of the Notes to Consolidated Financial Statements on Form 10-K for the year ended
December 31, 2006 describes the significant accounting policies used in the preparation of the Companys financial statements.

The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the
date of the financial statements and reported amounts of revenues and expenses during the reporting period and related disclosure of contingent liabilities. Actual results could differ from those estimates.



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|Item 3. | Qualitative and Quantitative Disclosures about Market Risk.
|------- | -----------------------------------------------------------

We are exposed to market risk on our variable rate debt under our Credit Facility with BB&T. For variable rate debt, changes in interest rates generally do not influence fair market value, but do affect future earnings and cash flows.
We do not currently use interest rate swaps, futures contracts or options on futures, or other types of derivative financial instruments to mitigate this risk. Based upon the amount of variable rate debt outstanding at the end of the year, and
holding the variable rate debt balance constant, each one percentage point increase in interest rates occurring on the first day of an annual period would result in an increase in interest expense of approximately $249,000 based on the principal
balance under our Credit Facility as of September 30, 2007. Other changes in fair market values as a result of interest rate changes are not currently expected to be material.



|Item 4. | Controls and Procedures.
|------- | ------------------------

Disclosure Controls and Procedures

As of the end of the period covered by this Quarterly Report on Form 10-Q, our management, with the participation of our Chief
Executive Officer and our Chief Financial Officer, carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based upon
that evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that our disclosure controls and procedures are effective as of the end of the period covered by this report.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting during the quarter ended September 30, 2007 that have materially affected, or are reasonably likely to materially affect, our internal control over financial
reporting.

PART II  OTHER INFORMATION



|Item 1. | Legal Proceedings.
|------- | ------------------

We are, from time to time, a
party to disputes arising from normal business activities, including various employee-related matters. In the opinion of our management, resolution of these matters will not have a material adverse effect upon our financial condition or future
operating results.



|Item 1A. | Risk Factors.
|-------- | -------------

Our business, results of operations
and financial condition are subject to a number of risks, including the risks set forth below. You should carefully consider these risks. Additional risks and uncertainties, including those that are not yet identified or that we currently believe
are not significant, may also adversely affect our business, results of operations and financial condition.

We are not in compliance with financial
covenants under our senior secured credit facility and may not be able to repay our indebtedness under the facility.

As of
September 30, 2007, we had $24.9 million of indebtedness outstanding under our Credit Facility with BB&T. The facility is secured by a lien on substantially all of our assets. The Credit Facility requires that we comply with a ratio of
EBITDAR to debt service and a ratio of funded debt to EBITDA, both of which are calculated on a consolidated rolling four quarter basis. As of December 31, 2006, March 31, 2007, June 30, 2007 and September 30, 2007 we were not in
compliance with either of these financial covenants. Although BB&T has granted a waiver of our compliance with these covenants and any corresponding events of default for the testing periods ended as of December 31, 2006 and March 31,
June 30 and September 30, 2007 and has extended the temporary increase in the borrowing base under the Credit Facility by $3.6 million through December 31, 2007, there is no assurance that BB&T will provide a waiver in the event
of any future non-compliance. A failure to comply with these covenants and other provisions of Credit Facility in the future could result in an event of default under the facility, which could, among other things, permit BB&T to accelerate
payment of the debt under the facility.

The agreement governing our senior secured credit facility contains various covenants that significantly limit
our managements discretion in the operation of our business and limits our ability to make capital and other expenditures.



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Our senior secured credit facility with BB&T contains various covenants that restrict our ability to,
among other things:



| |  |  | obtain additional financing in the future for working capital, capital expenditures, acquisitions, general corporate or other purposes;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------



| |  |  | borrow under the facility based upon borrowing base limitations;
| | - |  | ----------------------------------------------------------------



| |  |  | pay dividends and make other distributions;
| | - |  | -------------------------------------------



| |  |  | merge, consolidate or transfer all or substantially all of our assets; or
| | - |  | -------------------------------------------------------------------------



| |  |  | create liens.
| | - |  | -------------

Our senior secured
credit facility with BB&T also requires that we comply with a ratio of EBITDAR to debt service and a ratio of funded debt to EBITDA, both of which are calculated on a consolidated rolling four quarter basis. As of September 30, 2007, we
were not in compliance with these financial covenants. Although BB&T has granted to us a waiver of our compliance with these covenants and any corresponding event of default as of September 30, 2007, there is no assurance that BB&T will
provide a waiver in the event of any future non-compliance. A failure to comply with these covenants and other provisions of our senior secured credit facility in the future could result in an event of default under the facility, which could, among
other things, permit BB&T to accelerate payment of the debt under the facility.

Our indebtedness under the senior secured credit
facility could have other important consequences to our business. For example, it could:



| |  |  | limit our ability to borrow additional funds or obtain additional financing in the future; therefore, we may be unable to satisfy our financial obligations,
including our payroll;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | expose us to greater interest rate risk since the interest rate on borrowings under our senior secured credit facility is variable;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------



| |  |  | limit our flexibility to plan for and react to changes in our business and our industry and make us less flexible in responding to changing economic conditions; and
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | make us more vulnerable to economic downturns and less able to withstand competitive pressures.
| | - |  | -----------------------------------------------------------------------------------------------

Our ability to borrow under the senior secured credit facility is restricted by borrowing base limitations which are a function of defined levels of
eligible accounts receivable, inventory and net fixed assets. Other than increases in the borrowing base, if any, our borrowing capacity under the senior secured credit facility through December 31, 2007 will continue to be limited to cash
receipts other than from collection of eligible accounts receivable. Consequently, we have little or no borrowing capacity under the senior secured credit facility and we are monitoring our cash position on a daily basis and are limiting our capital
and other expenditures at this time.

Refer to Managements Discussion and Analysis of Financial Condition and Results of
Operations  Liquidity and Capital Resources for a discussion of the terms of and limitations on borrowings under our senior secured credit facility with BB&T.

Our acquisitions may not achieve all or any of their intended benefits.

Our acquisitions of STI and
SSES involve various risks, including: our incurrence of significant secured indebtedness; that customer relationships may be adversely impacted resulting in less or no revenue from such customers; the potential loss of key employees; the risk of
diverting managements attention from normal daily operations of our existing businesses; risks of entering markets in which we have no or limited direct prior experience; initial dependence on unfamiliar supply chains or relatively small
supply partners; and insufficient revenues to offset increased expenses associated with the acquisition. We also may encounter other risks, including:



| |  |  | our failure to discover material liabilities in target companies; and
| | - |  | ---------------------------------------------------------------------



| |  |  | the failure of prior owners of any acquired businesses or their employees to comply with applicable laws or regulations such as the Federal Acquisition Regulations
and health, safety, employment and environmental laws, or their failure to fulfill their contractual obligations to the federal government or other clients.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

In connection with our acquisition of SSES, we have experienced some employee attrition and cost associated with integrating the businesses. In addition,
in our acquisitions of STI and SSES, as well as future acquisitions, if any, we have and may continue to incur significant acquisition costs and expenses as well as amortization expenses related to intangible assets. We also may incur additional
significant write-offs of goodwill associated with STI and SSES. Our operating results could be adversely and materially affected by these costs, expenses and write-offs.

There can be no assurance that our acquisitions of STI or SSES will be successful and will not materially adversely affect our business, operating results, or financial condition.

We may have difficulty integrating the operations of companies we acquire, which may adversely affect our results of operations.



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The success of our acquisitions of STI and SSES depends upon our ability to successfully integrate the
businesses of these companies. The integration of those businesses may result in unforeseen events or operating difficulties, absorb significant management attention and require significant financial resources that would otherwise be available for
the ongoing organic development of our businesses. These integration difficulties could include:



| |  |  | the integration of business practices affecting the profitability and cash needs of the operations;
| | - |  | ---------------------------------------------------------------------------------------------------



| |  |  | the integration of personnel with disparate business backgrounds;
| | - |  | -----------------------------------------------------------------



| |  |  | the loss of key employees of acquired companies;
| | - |  | ------------------------------------------------



| |  |  | the transition to new information, supply and distribution systems;
| | - |  | -------------------------------------------------------------------



| |  |  | the coordination of geographically dispersed organizations;
| | - |  | -----------------------------------------------------------



| |  |  | the reconciliation of different corporate cultures; and
| | - |  | -------------------------------------------------------



| |  |  | the integration of internal financial controls, financial reporting and disclosure controls of acquired companies with our controls and, where applicable,
improvement of the acquired companys controls.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

For these or other reasons, we may be unable to retain key clients
or to retain or renew contracts of acquired companies. Moreover, any acquired business may fail to generate the revenues or net income we expected or produce the efficiencies or cost-savings that we anticipated. Any of these outcomes could
materially adversely affect our business, financial condition and operating results.

We have made capital expenditures and have made strategic
acquisitions and investments that may not prove to be successful.

We have made capital outlays, such as for the construction of our
filter canister line, with a view to expanding our portfolio of products and services, expanding into new markets and businesses, and accelerating the development of new or improved products. To do so, we have used significant amounts of cash,
incurred debt and assumed indebtedness. On October 31, 2006, we acquired Signature Special Event Services, LLC through our wholly owned SSES subsidiary for a cash purchase price of $21.75 million, including our working capital adjustment as of
the closing. We borrowed approximately $23.5 million under our Credit Facility with BB&T to pay the cash purchase price and pay other amounts in connection with the acquisition and the credit facility and related expenses and fees. Acquisitions
and strategic investments involve numerous risks, including those associated with the acquisition of SSES. In addition, the operations of SSES are significantly more capital intensive than our other businesses, which may require us to increase our
borrowings or use cash resources to fund SSESs operations. Our current cash and liquidity position, however, significantly limits our ability to make capital expenditures at this time.

We face risks relating to pending governmental investigations that could have a material adverse effect on our business.

As previously disclosed, following an independent investigation conducted by our Audit Committee regarding questionable business practices by two former
Company senior executives, our Board sought their resignations, culminating in their April 2007 resignation. Thereafter, the Audit Committee voluntarily notified the appropriate authorities of its investigation.

In May 2007, the Securities and Exchange Commission (SEC) commenced an informal non-public inquiry relating to the matters investigated by
the Audit Committee, as well as other matters, and requested that the Company voluntarily produce documents relating to its investigation. On July 11, 2007, the Company learned that the informal inquiry commenced by the SEC had become a formal
investigation and on October 23, 2007, the SEC issued a subpoena to the Company to produce documents substantially similar to the voluntary production request. The SECs formal order of investigation states generally that the purpose of
the SECs investigation is to determine whether the federal securities laws have been violated and permits the SEC to subpoena documents and compel witnesses to testify as to matters relating to its investigation. The Company believes that
current and former Company executives have also received subpoenas from the SEC to produce documents and provide testimony.

The Company
believes that the focus of the formal investigation is substantially the same as the informal inquiry and intends to continue to fully cooperate with the SEC regarding this matter. However, responding to the SEC subpoena and any other governmental
investigation may be time-consuming and disruptive to normal business operations and could impede our ability to achieve our business objectives.



24



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The Companys management of such investigations will likely result in significant additional expense
and the outcome of any such investigation is difficult to predict. Additionally, under the Companys Bylaws, we may be required to indemnify current and former officers and directors, and advance expenses to them, in connection with their
participation in any proceeding arising out of their service to us. These payments may be material.

SSES generally does not have long-term agreements
with its customers, making its revenue and operating results for any quarter difficult to forecast and substantially dependent upon customer orders received and fulfilled in that quarter.

SSES generally does not have long-term agreements with its customers. Rather, SSESs revenue derives from customer business relationships that were
historically developed and maintained. If SSES is unable to maintain strong business relationships with these customers or unable to retain key employees that maintain these relationships, TVIs results of operations or financial condition may
be materially and adversely affected. Further, many of SSESs customers place orders for deliveries with little advance notice. These orders generally have no cancellation or rescheduling penalty provisions. Therefore, cancellations, reductions
or delays of orders from any significant customer could have a material adverse effect on our business, financial condition and results of operations.

A significant portion of our sales are to federal, state and local governmental entities, the loss or significant reduction of which would have a material adverse impact on our business, financial condition and results of operations.

The loss or significant reduction in government funding of programs in which we participate or the funded agencys decision not
to spend appropriated funds could materially adversely affect our future revenues, earnings and cash flows and thus our ability to comply with our financial obligations. U.S. government contracts are conditioned upon Congress continuing
approval of the amount of necessary spending. Congress usually appropriates funds for a given program each fiscal year even though contract periods of performance may exceed one year. Consequently, at the beginning of a major program, the contract
is usually partially funded, and additional monies are normally committed to the contract only if Congress makes appropriations for future fiscal years. State contracts are generally subject to similar funding considerations. Therefore, if Congress
does not appropriate funds for programs under which the government procures our products, the lack of funds may result in a loss or significant reduction of our government sales. In addition, even if funded, an agency may elect not to spend
appropriated funds for various reasons, which may have a similar adverse effect on our business, financial condition and results of operations.

Because
we rely on a limited number of third party distributors for the marketing, sale and support of our products, an impairment or termination of these relationships may materially adversely affect our business.

Our shelters and related products business sells the majority of its products through a limited number of independent distributors and third party sales
agents, such as Fisher Scientific Company LLC in the U.S. and Canada, W.W. Grainger, Inc. in the U.S. and Professional Protection Systems Ltd. internationally. Approximately 18% and 60% of our total sales in 2006 and 2005, respectively, were made
through Fisher Scientific; approximately 13% and 4% of our total sales in 2006 and 2005, respectively, were made through W.W. Grainger. We anticipate that our distributors will continue to account for a significant portion of our sales in our
Shelters and Related Products segment for the foreseeable future. In addition, over the longer-term, we anticipate transitioning our Personal Protection Equipment segment to a distributor sales model, which, if successful, would increase our
dependence on third party distributors.

We have a limited ability to influence our distributors marketing efforts and relying on
distributors could harm our business for various reasons, including that the agreements with our distributors may contain unfavorable terms, such as exclusivity provisions or early termination rights; such agreements may terminate prematurely or
result in litigation due to disagreements; our distributors may not devote sufficient resources to the sale of our products or may be unsuccessful in their efforts to sell our products or otherwise impair our reputation; existing relationships with
our distributors may preclude us from entering into new arrangements; and we may not be able to negotiate new distributor agreements on acceptable terms.

Our common stock is subject to delisting from the NASDAQ Stock Market, which would likely adversely affect our ability to raise capital and our stockholders ability to sell their shares.

Under NASDAQ Stock Market Rule 4310(c)(4), stocks listed on the NASDAQ Capital Market must maintain a minimum bid price of $1.00 per share in order to
maintain continued listing (the Minimum Bid Price Rule). Under this rule, if a companys stock closes below the minimum $1.00 per share requirement for 30 consecutive business days, it is subject to potential delisting from the
NASDAQ Capital Market.

On June 6, 2007, we received a letter from the Listing Qualifications Department of The NASDAQ Stock Market
indicating that the Company was not in compliance with the Minimum Bid Price Rule because the closing bid price per share



25



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for the Companys common stock had been below $1.00 per share for 30 consecutive business days. In accordance with the NASDAQ Marketplace Rules, the
Company has been provided with 180 calendar days, or until December 3, 2007, to regain compliance with the Minimum Bid Price Rule. This notification has no effect on the listing of the Companys common stock until that date.

To regain compliance with the Minimum Bid Price Rule, the closing bid price of the Companys common stock generally must remain at $1.00 per share
or more for a minimum of ten consecutive business days. If the Company does not regain compliance with the Minimum Bid Price Rule by December 3, 2007, NASDAQ will determine whether the Company meets The NASDAQ Capital Market initial
listing criteria set forth in Marketplace Rule 4310(c), except for the bid price requirement. If the Company meets the initial listing criteria, other than the bid price requirement, NASDAQ may grant the Company an additional 180 calendar day
compliance period. If the Company is not eligible for an additional compliance period, NASDAQ will provide the Company with written notification that its common stock will be delisted. At that time, the Company would be permitted to appeal
NASDAQs determination to delist the Companys common stock to a NASDAQ Listings Qualifications Panel.

The Company currently
does not meet the minimum price requirement but believes that it would qualify for the additional 180 calendar day compliance period based on the Companys most recent analysis as of November 6, 2007. However, there can be no assurance in
this regard. The Company intends to seek to regain compliance with the Minimum Bid Price Rule during this additional 180 day compliance period. The Companys management and board of directors are considering alternatives to address compliance
with the continued listing standards of the NASDAQ Stock Market that may include a reverse stock split.

If the Companys common stock
is delisted from NASDAQ, we would seek a listing on the over-the-counter bulletin board, or OTCBB. However, the market liquidity of the Companys common stock on the OTCBB would be adversely affected, which would reduce stockholders
ability to sell Company securities in the secondary market. Additionally, any such delisting would harm the Companys ability to raise capital through alternative financing sources on acceptable terms, if at all, and may result in the loss of
confidence in the Companys financial stability by suppliers, customers and employees. We cannot give investors any assurance that we will be able to maintain compliance with the $1.00 per-share minimum price requirement for continued listing
on NASDAQ or that our common stock will not be delisted by NASDAQ in the future.

Our future financial performance will depend in large part on the
success of our turnaround efforts and the successful development, demand for and acceptance of our products and services.

The market
for our Shelters and Related Products, Personal Protection Equipment and SSES Rental Services products and services may not grow, may grow at a slower rate than we expect or may diminish. In particular, revenue for our Shelters and Related Products
segment has significantly declined in recent periods. The Company has instituted turnaround efforts to reorganize all of our business segments to enhance accountability and institute a product-focused sales model; however, our efforts in these
regards are not proven and may not be effective or successful. If our turnaround efforts fail to perform as we anticipate, or if the market fails to accept our products and services on the terms that we offer, our business could suffer.

Additionally, we believe that we must enhance the functionality of our products to maintain successful commercialization and continued acceptance of
our product offerings. If we are unable to offer our products and services at prices or on terms acceptable to the market, identify and develop new enhancements to existing products and services on a timely and cost-effective basis, or if new
enhancements do not achieve market acceptance, we may experience customer dissatisfaction, reduction or cancellation of orders and loss of revenue.

The life cycle of our products is difficult to predict and the market for many of our products is characterized by rapid technological change, changing customer preferences and evolving industry standards. The introduction of products
employing new technologies and emerging industry standards could render our existing products obsolete and unmarketable.

The variable and often long
sales cycles for our products could cause significant fluctuation in our quarterly and annual results.

The typical sales cycle of our
products and services is unpredictable and generally involves a significant commitment of resources by our customers. A customers decision to purchase our products generally involves the evaluation of the available alternatives by a
significant number of personnel in various functional areas and often is subject to delays over which we may have little or no control, including budgeting constraints, internal procurement and other purchase review procedures and the inclusion or
exclusion of our products on customer-approved standards list. Accordingly, we typically must expend substantial resources educating prospective customers about our products. Therefore, the length of time between the date of initial contact with the
potential customer or distribution channel partner and the related sale of our products may be as much as one year, with the larger sales generally requiring significantly more time. Additionally, the length of time



26



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between the date of initial contact and the sale is often subject to delays over which we may have little or no control, including the receipt of necessary
government funding. As a result, our ability to predict the timing and amount of specific sales is limited. If we experience any delay or failure in completing sales, we may incur significant expense without generating any associated revenue which,
if significant, could have a material adverse effect on our business and could cause operating results to vary significantly from quarter-to-quarter.

Selling to the U.S. government subjects us to unfavorable termination provisions and other review and regulation.

Companies such as ours that are engaged in supplying defense-related services and equipment to U.S. government agencies are subject to certain business risks peculiar to the defense industry. These risks include the ability of the U.S.
government to unilaterally suspend us from receiving new orders or contracts pending resolution of alleged violations of procurement laws or regulations; terminate existing orders or contracts; reduce the value of existing orders or contracts; audit
our contract-related costs and fees, including allocated indirect costs; and control and potentially prohibit the export of our products.

The purchase
orders and contracts governing the purchase for our products may commit us to unfavorable terms.

We generally sell our PAPRs and
shelter systems and most other products pursuant to purchase orders issued by the purchasing party. Although we attempt to ensure that the terms of such purchase orders are acceptable to us, some purchase orders may contain unfavorable terms, such
as heightened performance or warranty obligations or return rights. Additionally, our larger customers may use purchase orders with established terms that are not subject to negotiation or change by us.

Additionally, we generally provide certain products, including our thermal products, through formal contracts with the U.S. and state governments. These
contracts generally can be terminated by the government either for its convenience or if we default by failing to perform under the contract. Termination for convenience provisions provide only for our recovery of costs incurred or committed
settlement expenses and profit on the work completed prior to termination. Termination for default provisions provide for the contractor to be liable for excess costs incurred by the U.S. government in procuring undelivered items from another
source. These contracts are generally fixed price contracts, as the price we charge is not subject to adjustment based on cost incurred to perform the required work under the contract. Therefore, we fully absorb any cost overruns on these fixed
price contracts and this potentially reduces our profit margin on the contract. Failure to anticipate technical problems, estimate costs accurately or control costs during performance of a fixed price contract may reduce our profit or cause a loss
on such contracts.

We may not be able to obtain critical components.

We purchase a number of critical custom components from single source vendors for which alternative sources may not be available. Delays or interruptions in the supply of these components could result in delays or
reductions in product shipments. The purchase of these components from outside suppliers on a single source basis subjects us to risks, including the continued availability of supplies, price increases and potential quality assurance problems. While
alternative suppliers may be available, these suppliers must be identified and qualified. We cannot be certain that any such suppliers will meet our required qualifications or that alternative suppliers can be identified in a timely fashion, if at
all. Consolidations involving suppliers could reduce further the number of component alternatives and affect the cost of such supplies. An increase in the cost of such supplies could make our products less competitive. Production delays, lower
margins or less competitive product pricing could have a material adverse effect on our business, financial condition and results of operations.

We are
subject to significant government regulation.

The U.S. legal and regulatory environment governing our products is subject to constant
change. Further changes in the regulatory environment relating to the marketing of our shelter, decontamination systems, PAPRs and our other products that increase the administrative and operational costs associated with the marketing of our
products or that increase the likelihood or scope of competition, could harm our business, financial condition and results of operations.

Although we have received NIOSH approval to incorporate our filter canister into one of our own PAPRs designs, we currently have several other commercial filter applications coupled with our PAPRs under review by NIOSH. If regulatory review
and approval takes longer than we anticipate or if NIOSH does not grant the approvals that we seek, the delay or lack of regulatory approval may have a material adverse effect on our business, financial condition and results of operations.

The regulation of our products outside the United States varies by country. Noncompliance with foreign country requirements may include
some or all of the risks associated with noncompliance with U.S. regulation as well as other risks.



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Our products rely on intellectual property rights. Any failure by us to obtain and protect these rights could enable
our competitors to market products with similar features that may reduce demand for our products, which would adversely affect our revenues. Additionally, we could be subject to claims that our products violate the intellectual property rights of
others.

Although we seek to protect our products through a combination of patent, trade secret, copyright, and trademark law, there is
no guarantee that our methods of protecting our intellectual property rights in the United States or abroad will be adequate. Despite our efforts to protect our proprietary rights, unauthorized parties may attempt to copy or otherwise obtain and use
our products or technologies. Policing unauthorized use of our products is difficult, and we cannot be certain that the steps we have taken will prevent misappropriation of our technology, particularly in foreign countries where the laws may not
protect our intellectual property rights as effectively as those in the United States. If we are unable to protect our proprietary technology or that of our customers, our results of operations and any competitive advantage that we may have may be
materially and adversely affected.

We generally enter into confidentiality or other agreements with our employees, consultants, channel
partners and other corporate partners, and do control access to our intellectual properties and the distribution of our proprietary information. These measures afford only limited protection and may prove to be inadequate. Others may develop
technologies that are similar or superior to our technology or design around the intellectual properties we own or utilize.

We expect that
our products may be increasingly subject to third-party infringement claims as the number of competitors in the markets that we serve grows and the functionality of products in different industry segments grows and overlaps. Although we are not
aware that our products employ technology that infringes any proprietary rights of third parties, there has been significant litigation in recent years involving patents and other intellectual property rights, and third parties may assert
infringement claims against us. Regardless of whether these claims have any merit, they could be time-consuming to defend; result in costly litigation; divert our managements attention and resources; cause product shipment delays; or require
us to enter into royalty or licensing agreements, which may not be available on terms acceptable to us, if at all.

A successful claim of
product infringement against us or our failure or inability to license the infringed or similar technology could damage our business because we would not be able to sell our products without redeveloping them or otherwise incurring significant
additional expenses and we may be judged liable for significant damages.

Our products may contain unknown defects that could result in product
liability claims or decrease market acceptance and have a material adverse effect on our business, financial condition and results of operations.

We have offered, and continue to offer, various warranties on our products. Our products may contain unknown defects or result in failures, which are not detected until after commercial distribution and use. Any of
these defects could be significant and could harm our business, financial condition and results of operations. Any significant defects or errors may result in costly litigation; diversion of managements attention and resources; loss of sales;
delay in market acceptance of our products; increase in our product development costs; or damage to our reputation.

In addition, the sale
and support of our products may entail the risk of product liability or warranty claims based on personal injury or other damages due to such defects or failures. Although we maintain reserves for warranty-related claims that we believe to be
adequate, we cannot assure you that warranty expense levels or the results of any warranty-related legal proceedings will not exceed our reserves. Additionally, although we carry comprehensive general liability insurance and product liability
insurance for damages that may arise from our products, our current insurance coverage may be insufficient to protect us from all liability that may be imposed under these types of claims. Consequently, the marketing of our products entails product
liability and other risks and could have a material adverse effect on our business, financial condition and results of operations.

Intense competition
in our industry could limit our ability to attract and retain customers.

The markets for our products and services are intensely
competitive. The markets for our Shelters and Related Products and Personal Protection Equipment products are characterized by rapidly evolving industry standards, changes in customer needs and preferences and opportunities relating to technological
advancement, and are significantly affected by new product introductions and improvements. The markets for our services, including SSESs event rental offerings, are characterized by high customer expectations with respect to performance and
intense price competition. Many of our existing and potential competitors have longer operating histories, significantly greater financial, technical, marketing, personnel and other resources, greater name recognition, broader product offerings and
a larger installed base of customers than us, any of which could provide them with a significant competitive advantage. Increased competition could also result in price reductions for our products and services and lower profit margins, either of
which could materially and adversely affect our business, financial condition and results of operations.



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We expect to face increased competition in the future from our current competitors. In addition, new
competitors or alliances among existing and future competitors may emerge and rapidly gain significant market share, many of which may possess significantly greater financial, technical, marketing, personnel and other resources.

We are subject to economic, political and other risks associated with our international sales, which could materially adversely affect our business.

A portion of our revenue is generated from the international sale of our products through distributors, predominately in Canada, Western Europe and
Australia. Net revenue outside the United States was approximately 10%, 3% and 13% of our total net revenue in 2006, 2005 and 2004, respectively. Our international sales are subject to a variety of factors, including changes in the political or
economic conditions in a country or region; future fluctuations in exchange rates; trade protection measures and import or export licensing requirements; difficulty in effectively managing our international distributors; and differing tax laws and
regulatory requirements, and changes in those laws and requirements. If we are unable to adapt to the requirements of our international customers or the markets in which they operate, we may experience a material adverse effect on our international
sales.

Our Common Stock is subject to significant price fluctuations.

Effective in August 2004, our common stock was listed and began trading on the NASDAQ Small Cap Market, now known as the NASDAQ Capital Market.
Previously, our common stock traded on the OTC Bulletin Board. Historically, there has been a limited public market for our common stock.

The trading price of our common stock is likely to be volatile and sporadic and the trading volume of our common stock has fluctuated significantly from day to day during recent periods. The stock market in general and, in particular, the
market for so-called micro-cap companies, such as TVI, has experienced extreme volatility in recent years. This volatility has often been unrelated to the operating performance of particular companies. Volatility in the market price of
our common stock may prevent investors from being able to sell their common stock at or above the price such investors paid for their shares or at any price at all. In addition, in the event our operating results fall below the expectations of
public market analysts and others, the market price of our common stock would likely be materially adversely affected.

We have adopted certain
anti-takeover provisions that could prevent or delay a change in control.

Our Articles of Incorporation and Bylaws contain the
following provisions: an advance notice provision setting forth procedures governing stockholder proposals and the nomination of directors, other than by or at the direction of the Board of Directors or a Board committee; and a
classified Board structure, generally providing for three-year staggered terms of office for all members of our Board.

On
September 4, 2007, TVI Corporation elected to become subject to the provisions of Title 3, Subtitle 8 of the Maryland General Corporation Law (the Governance Measures). The Governance Measures provide:

(1) for a classified board of directors;

(2)
that a director may be removed only by the affirmative vote of at least two-thirds of all the votes entitled to be cast by the stockholders generally in the election of directors;

(3) that, in the event of a vacancy on the Board occurring for any reason, such vacancy shall be filled by the Board and the substitute director will
serve for the remainder of the term of the replaced director;

(4) that the number of directors may only be fixed by the Board; and

(5) that TVIs corporate secretary may call a special meeting of stockholders only on the written request of the stockholders entitled
to cast at least a majority of all votes entitled to be cast at the meeting.

Additionally, in 2003 we adopted a Stockholders Rights Plan,
which is designed to enable all TVI stockholders to realize the full value of their investment and to provide for fair and equal treatment for all TVI stockholders in the event that an unsolicited attempt is made to acquire the Company.

Although we believe that each of the above measures are designed to promote both effective corporate governance and orderly Board deliberations of
important business matters, these provisions may discourage, delay or prevent a third party from acquiring or merging with TVI, even if such action may be considered favorable to some of TVIs stockholders.



29



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|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.
|------- | ------------------

As previously disclosed, in
March 2007 the Companys Audit Committee received notice under the Companys Accounting Complaint Policy alleging questionable business transactions and practices by the former Chief Executive Officer and a former Executive Vice President
of the Company. In response, the Audit Committee, assisted by special independent counsel, conducted an investigation regarding these allegations. Among other matters, the Committees investigation uncovered evidence of a series of questionable
business transactions and practices between 2003 and early 2005 which may have caused the Company to overpay approximately $1.7 million, for which the Audit Committee did not find any credible business reason. The Audit Committees findings
influenced the Boards decision to seek the resignations of the former Chief Executive Officer and the former Executive Vice President, who resigned all posts with the Company on April 18, 2007. After concluding its investigation, the
Audit Committee notified the appropriate authorities and pledged to cooperate with any resulting government inquiry or investigation.

On
May 14, 2007, the Securities and Exchange Commission (SEC) issued a notice that it was commencing an informal non-public inquiry relating to the matters investigated by the Audit Committee, as well as other transactions and matters.
The SEC requested that the Company voluntarily produce documents relating to its investigation. On July 11, 2007, the Company learned that the informal inquiry commenced by the SEC had become a formal investigation and on October 23, 2007,
the SEC issued a subpoena to the Company to produce documents that are substantially similar to the voluntary production request. The SECs formal order of investigation states generally that the purpose of the SECs investigation is to
determine whether the federal securities laws have been violated and permits the SEC to subpoena documents and compel witnesses to testify as to matters relating to its investigation. The Company believes that the focus of the formal investigation
is substantially the same as the informal inquiry and intends to continue to fully cooperate with the SEC regarding this matter.



30



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|Item 6. | Exhibits.
|------- | ---------



|               |  |                                                                                                                                                                                                                                                                                                                                                                              
|-------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit Number |  | Description                                                                                                                                                                                                                                                                                                                                                                  
|3.1            |  | Articles of Amendment and Restatement of the Company (incorporated by reference to Exhibits from our Form 10-KSB for the year ended December 31, 2003)                                                                                                                                                                                                                       
|               | 
|3.1.1          |  | Articles Supplementary establishing and fixing the rights and preferences of the Series A Preferred Stock (incorporated by reference to Exhibit 3.1.1 of our Form 10-Q for the quarter ended
June 30, 2007)                                                                                                                                                                  
|               | 
|3.1.2          |  | Articles Supplementary filed September 4, 2007 (incorporated by reference to Exhibit 3.1 of Current Report on Form 8-K dated August 29, 2007)                                                                                                                                                                                                                                
|               | 
|3.2            |  | Amended and Restated By-laws of the Company (incorporated by reference to Exhibit 3.2 to our Form 10-KSB for the year ended December 31, 2004)                                                                                                                                                                                                                               
|               | 
|3.2.1          |  | Amendment to By-laws of the Company (incorporated by reference to Exhibit 3.2 of Current Report on Form 8-K dated August 29, 2007)                                                                                                                                                                                                                                           
|               | 
|10.6.1         |  | TVI First Amendment to Financing and Security Agreement, dated as of May 25, 2007, by and among TVI Corporation, CAPA Manufacturing Corp., Safety Tech International, Inc., TVI Air Shelters,
LLC, TVI Holdings One, Inc. and Branch Banking & Trust Company (incorporated by reference to Exhibit 99.1 of Current Report on Form 8-K dated May 25, 2007)                    
|               | 
|10.6.2         |  | TVI Second Amendment to Financing and Security Agreement, dated as of June 21, 2007, by and among TVI Corporation, CAPA Manufacturing Corp., Safety Tech International, Inc. and Signature
Special Event Services, Inc. and Branch Banking & Trust Company (incorporated by reference to Exhibit 99.1 of Current Report on Form 8-K dated June 21, 2007)                     
|               | 
|10.6.3         |  | TVI Third Amendment to Financing and Security Agreement, dated as of August 7, 2007, by and among TVI Corporation, CAPA Manufacturing Corp., Safety Tech International, Inc. and Signature
Special Event Services, Inc. and Branch Banking & Trust Company (incorporated by reference to Exhibit 10.6.3 of Quarterly Report on Form 10-Q for the quarter ended June 30, 2007)
|               | 
|10.6.4         |  | TVI Fourth Amendment to Financing and Security Agreement, dated as of October 12, 2007, by and among TVI Corporation, CAPA Manufacturing Corp., Safety Tech International, Inc. and Signature
Special Event Services, Inc. and Branch Banking & Trust Company (incorporated by reference to Exhibit 10.6.4 of Current Report on Form 8-K dated October 12, 2007)             
|               | 
|10.6.5         |  | TVI Fifth Amendment to Financing and Security Agreement, dated as of November 7, 2007, by and among TVI Corporation, CAPA Manufacturing Corp., Safety Tech International, Inc. and Signature
Special Event Services, Inc. and Branch Banking & Trust Company (incorporated by reference to Exhibit 10.6.4 of Current Report on Form 8-K dated November 7, 2007)              
|               | 
|10.12.1        |  | First Extension of Lease Agreement, dated as of July 27, 2007, between the Company and Ernest & Alice Mark Family Trust and Michael & Sally Mark Family Trust (incorporated
by reference to Exhibit 10.12.1 of Current Report on Form 8-K dated July 27, 2007)                                                                                                               
|               | 
|10.19          |  | Interim Employment Agreement dated as of April 18, 2007 by and between TVI Corporation and Harley A. Hughes, as amended by letter agreement dated August 6, 2007 (incorporated by reference to
Exhibit 10.1 of Current Report on Form 8-K dated August 6, 2007)                                                                                                              
|               | 
|31.1           |  | Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                           
|               | 
|31.2           |  | Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                           
|               | 
|32.1           |  | Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                           
|               | 
|32.2           |  | Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                           



31



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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.



|                       |  |                                                  
|---------------------- |  | -------------------------------------------------
|                       |  | TVI CORPORATION                                  
|                       |  | (Registrant)                                     
|                       | 
|Date: November 7, 2007 |  | /s/ Harley A. Hughes                             
|                       |  | Harley A. Hughes                                 
|                       |  | President and Chief Executive Officer            
|                       | 
|Date: November 7, 2007 |  | /s/ Sherri S. Voelkel                            
|                       |  | Sherri S. Voelkel                                
|                       |  | Senior Vice President and Chief Financial Officer



32



---

EXHIBIT INDEX



|               |  |                                                                                                                                                                                                                                                                                                                                                                              
|-------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit Number |  | Exhibit Description                                                                                                                                                                                                                                                                                                                                                          
|3.1            |  | Articles of Amendment and Restatement of the Company (incorporated by reference to Exhibits from our Form 10-KSB for the year ended December 31, 2003)                                                                                                                                                                                                                       
|               | 
|3.1.1          |  | Articles Supplementary establishing and fixing the rights and preferences of the Series A Preferred Stock (incorporated by reference to Exhibit 3.1.1 of our Form 10-Q for the quarter ended
June 30, 2007)                                                                                                                                                                  
|               | 
|3.1.2          |  | Articles Supplementary filed September 4, 2007 (incorporated by reference to Exhibit 3.1 of Current Report on Form 8-K dated August 29, 2007)                                                                                                                                                                                                                                
|               | 
|3.2            |  | Amended and Restated By-laws of the Company (incorporated by reference to Exhibit 3.2 to our Form 10-KSB for the year ended December 31, 2004)                                                                                                                                                                                                                               
|               | 
|3.2.1          |  | Amendment to By-laws of the Company (incorporated by reference to Exhibit 3.2 of Current Report on Form 8-K dated August 29, 2007)                                                                                                                                                                                                                                           
|               | 
|10.6.1         |  | TVI First Amendment to Financing and Security Agreement, dated as of May 25, 2007, by and among TVI Corporation, CAPA Manufacturing Corp., Safety Tech International, Inc., TVI Air Shelters,
LLC, TVI Holdings One, Inc. and Branch Banking & Trust Company (incorporated by reference to Exhibit 99.1 of Current Report on Form 8-K dated May 25, 2007)                    
|               | 
|10.6.2         |  | TVI Second Amendment to Financing and Security Agreement, dated as of June 21, 2007, by and among TVI Corporation, CAPA Manufacturing Corp., Safety Tech International, Inc. and Signature
Special Event Services, Inc. and Branch Banking & Trust Company (incorporated by reference to Exhibit 99.1 of Current Report on Form 8-K dated June 21, 2007)                     
|               | 
|10.6.3         |  | TVI Third Amendment to Financing and Security Agreement, dated as of August 7, 2007, by and among TVI Corporation, CAPA Manufacturing Corp., Safety Tech International, Inc. and Signature
Special Event Services, Inc. and Branch Banking & Trust Company (incorporated by reference to Exhibit 10.6.3 of Quarterly Report on Form 10-Q for the quarter ended June 30, 2007)
|               | 
|10.6.4         |  | TVI Fourth Amendment to Financing and Security Agreement, dated as of October 12, 2007, by and among TVI Corporation, CAPA Manufacturing Corp., Safety Tech International, Inc. and Signature
Special Event Services, Inc. and Branch Banking & Trust Company (incorporated by reference to Exhibit 10.6.4 of Current Report on Form 8-K dated October 12, 2007)             
|               | 
|10.6.5         |  | TVI Fifth Amendment to Financing and Security Agreement, dated as of November 7, 2007, by and among TVI Corporation, CAPA Manufacturing Corp., Safety Tech International, Inc. and Signature
Special Event Services, Inc. and Branch Banking & Trust Company (incorporated by reference to Exhibit 10.6.4 of Current Report on Form 8-K dated November 7, 2007)              
|               | 
|10.12.1        |  | First Extension of Lease Agreement, dated as of July 27, 2007, between the Company and Ernest & Alice Mark Family Trust and Michael & Sally Mark Family Trust (incorporated
by reference to Exhibit 10.12.1 of Current Report on Form 8-K dated July 27, 2007)                                                                                                               
|               | 
|10.19          |  | Interim Employment Agreement dated as of April 18, 2007 by and between TVI Corporation and Harley A. Hughes, as amended by letter agreement dated August 6, 2007 (incorporated by reference
to Exhibit 10.1 of Current Report on Form 8-K dated August 6, 2007)                                                                                                              
|               | 
|31.1           |  | Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                           
|               | 
|31.2           |  | Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                           
|               | 
|32.1           |  | Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                           
|               | 
|32.2           |  | Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002