SECURITIES
AND EXCHANGE COMMISSION
 Washington,
DC 20549
 
 Form
10-K/A
 Amendment
No. 1
 
 (Mark
On)
 x
              ANNUAL
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934
 For the fiscal year
ended December 31, 2007
 or
  ̈
              TRANSITION
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934
 
 For
the transition period
from            to
  Commission
File Number 001-22302
 
 ISCO
INTERNATIONAL, INC.
 (Exact
name of registrant as specified in its charter)
 Delaware
                36-3688459(State
      or other jurisdiction ofincorporation
      or organization)
                (I.R.S.
      Employer Identification No.)
 1001
      Cambridge DriveElk
      Grove Village, Illinois 60007(847)
      391-9400(Address
      and telephone number of principal executive
offices)
 
 Securities
registered pursuant to Section 12(b) of the Act:
 Common Stock, Par Value $0.001
      Per Share
                
                American Stock Exchange(Title
      of each class)
                
                (Name
      of each exchange on which
registered) Securities
registered pursuant to Section 12(g) of the Act: None
 
 Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act.    Yes ̈Nox
 
 Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act.    Yes ̈Nox
 
 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 daysYesxNo ̈
 
 Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the best
of registrant’s knowledge, in the definitive proxy or information statements
incorporated by reference in Part III of this on Form 10-K or any amendment to
this on Form 10-K.    ̈
 
 Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
definitions of  “large accelerated filer”, “accelerated filer” and
“smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check
one):
 Large
      accelerated filer o
                Accelerated
      filer oNon-accelerated
      filer o
                Smaller
      reporting company x(do not
      check if a Smaller reporting company)  Yes  ̈ No x
 
 As of
June 30, 2007, the aggregate market value of the registrant’s common stock held
by non-affiliates of the registrant was approximately $20 million based on the
last sale price of the common stock on such date as reported on the American
Stock Exchange. This calculation excludes more than 90 million shares held by
directors, executive officers, and two holders of more than 10% of the
registrant’s common stock.
 
 As ofMarch31, 2008, there were approximately
223million shares of the registrant’s
common stock outstanding.
  DOCUMENTS
INCORPORATED BY REFERENCE
 None.
 
 Table of
Contents
  Explanatory
Note
  Amendment
No. 1 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended
December 31, 2007 (the “Annual Report”) filed with the Securities and Exchange
Commission on March 28, 2008 is being filed for the sole purpose of including
certain additional information required by Part III of this Form
10-K.  Any reference to “we,” the “Company” or “us” shall refer to
ISCO International, Inc.
  PART
      IIIItem 10.
              
              Directors,
      Executive Officers and Corporate Governance
              1Item 11.
              
              Executive
      Compensation
              6Item 12.
              
              Security
      Ownership of Certain Beneficial Owners and Management and Related
      Stockholder Matters
              12Item 13.
              
              Certain Relationships and
      Related Transactions and DirectorIndependence
              14Item 14.
              
              Principal
      Accountant Fees and Services
              17SignaturesExhibit IndexCertifications
 
   Table of Contents
 PART III
  Item 10. Directors, Executive Officers and Corporate
Governance
  The
Company’s Board of Directors currently consists of eight directors. In the
interest of effective governance, the board consists of a single class of
directors, with each director serving a one-year term. Each year the full class
of directors is subject to stockholder vote. At the Company’s 2008 annual
meeting, stockholders will vote on the election of eight directors. Each
director elected at the annual meeting will serve until the 2009 annual meeting
of stockholders and until such director’s successor has been elected and
qualified, except if the director resigns, is removed or dies before such
time.
  The board
members include employee directors Mr. Gordon Reichard, Jr., Dr. Amr Abdelmonem,
and Mr. James Fuentes and non-employee directors Dr. George Calhoun, Mr. Ralph
Pini, Mr. Torbjorn Folkebrant, Mr. John Owings and Mr. John Thode.
  Described
below is certain information concerning each director. Each of the members of
the Board of Directors is independent as defined by the AMEX corporate
governance listing standards other than Mr. Reichard, Dr. Abdelmonem, Mr.
Fuentes and Mr. Thode.
  
 Name
              
              Age
              
              Position
      with the Company
              
              Served as
                Director Since
              
              Term
                ExpiresGordon
      Reichard, Jr.
              
              47
              
              Director,
      Chief Executive Officer
              
              2008
              
              2008Ralph
      Pini
              
              55
              
              Chairman
      of the Board of Directors
              
              2004
              
              2008Amr
      Abdelmonem
              
              42
              
              Director,
      Chief Operating Officer and Chief Technology Officer
              
              2002
              
              2008George
      Calhoun
              
              55
              
              Director
              
              1999
              
              2008Torbjorn
      Folkebrant
              
              52
              
              Director
              
              2008
              
              2008James
      Fuentes
              
              52
              
              Director
      and Chief Strategy Officer
              
              2003
              
              2008John
      Owings
              
              58
              
              Director
              
              2007
              
              2008John
      Thode
              
              50
              
              Director
              
              2005
              
              2008
 
  Mr.
Reichard joined the Company as Chief Executive Officer during March
2008.  He has worked in several functions within the
telecommunications and technology sectors, including President and GM at
Ameritech, President, CEO and Founder of Telenisus and Vice President of
Marketing at Westell. Mr. Reichard began his career as an Electrical Engineer
with Zenith Electronics, and then Product and Sales positions at US
Robotics/3Com and continues as a Principal with The Magis Group.
 
 Mr. Pini
is currently Associate Dean at the University of Illinois, Chicago, and the
former Senior Vice President and Chief Technology Officer, Personal
Communications Sector, Motorola, Inc. He has spent twenty-eight years in the
global wireless industry. During this period he has been with Motorola’s
Personal Communications Group, where he managed the global R&D organization
and, prior to retirement, was the CTO for the group responsible for innovation,
technology platforms, and advanced technologies. He has broad experiences across
GSM, CDMA, and UMTS platforms. He received his MBA from Lake Forest Graduate
School of Management, and both his MS in Electrical Engineering and his BS in
Electrical and Computer Science from the University of Illinois,
Chicago. Mr. Pini served as interim CEO from November 2007 until March
2008, when Mr. Reichard joined the Company.  Mr. Pini serves as
Chairman of the Board of Directors, and serves on the Governance and
Compensation Committees.
 
 Dr.
Abdelmonem joined the Company in January 1995 and was promoted to Director of
Engineering in August 1998, to Vice President of Development Engineering in
March 1999, to Chief Technology Officer in December 1999 and additionally served
as Chief Executive Officer from June 2002 through January 2005. Dr. Abdelmonem
joined the Board of directors in July 2002. Before joining the Company, Dr.
Abdelmonem was an engineer with Exxon Corporation in Egypt. Subsequently, he was
affiliated with the University of Maryland in a number of research and teaching
positions where much of his research focused on semi-conductor laser and
advanced filter design. Dr. Abdelmonem earned his B.S. and M.S. degrees in
Electrical Engineering from Ain-Shams University in Cairo, Egypt, and his
Ph.D. from the University of Maryland. Much of his research focused on
semi-conductor laser design, superconducting technology and advanced filter
design. Dr. Abdelmonem is a Senior Member of the IEEE and has published numerous
documents for industry conferences and trade journals. He holds five patents and
has ten patent applications pending. Dr. Abdelmonem holds an M.B.A. from the
University of Chicago.  Dr. Abdelmonem assumed the role of Chief
Operating Officer during 2008.
 1
 Table of Contents
 Dr.
Calhoun has served as a director since November 1999 and served as the Chief
Executive Officer of the Company from November 1999 to June 2002 and as Chairman
of the Board from November 2000 to September 2002, and interim Chairman of the
Board from November 2007 through March 2008. Dr. Calhoun joined the Stevens
Institute of Technology in July 2003 as Executive-in-Residence, where he teaches
in the Undergraduate Program for Business & Technology, at the Howe School
of Technology Management. Dr. Calhoun has spent 25 years in the high-tech
segment of the wireless communications industry. He previously worked for
InterDigital Communications Corporation (NASDAQ: IDCC), where he was involved
for twelve years in the pioneering development of digital cellular technology.
Subsequently, he was Vice-Chairman of Geotek Communications, and was Chairman of
an engineering joint venture based in Israel, to develop a spread spectrum
frequency-hopping radio system for fleet radio communications. He also served as
Chairman of the Board and Audit Committee for Airnet Communications, a smart
antenna and software-defined radio technology company. He is also a member of
the Board of Clearstory Systems (NASDAQ: CSYS.OB), a company in the business of
electronic content management and digital archiving software. In 2005, he joined
the Board of PlayLogic Entertainment, Inc. (NASDAQ: PLGC.OB), a company in the
business of developing and publishing videogames. Dr. Calhoun holds one patent
(on wireless system architectures), and has published several books on wireless
communications, including the best-selling Digital Cellular Radio (Artech,
1988). His most recent book is Third Generation Wireless Systems: Post-Shannon
Signal Architectures (Artech, 2003). He has also been a Visiting Professor at
the Leiden University School of Management in the Netherlands. Dr. Calhoun has a
BA degree from the University of Pennsylvania, and a Ph.D. from the
Wharton School. Dr. Calhoun serves on the Compensation Committee and is
Chairman of the Audit Committee.
 
 Mr.
Folkebrant joined the Board during 2008, having spent more than 12 years with
Ericsson, was President and CEO of Ericsson France, SA where he built a very
successful operation, and started and built a successful RF Amplifier and Energy
Systems Organization in the USA. Most recently he was the Chairman and President
of Fractus SA, Barcelona Spain and has helped build the European customer
base for US-based Paratek Microwave.  Mr. Folkebrant serves on the
Audit and Governance Committees.
  Mr.
Fuentes was elected to the Board in November 2003. He is Founder of Clarity
Communication Systems, Inc. (“Clarity”), an Aurora, IL wireless software and
systems development company formed in 1998 and acquired by the Company during
January 2008, at which time Mr. Fuentes became an employee of ISCO. Previously,
Mr. Fuentes served at Lucent Technologies (formerly AT&T Bell Labs) for ten
years in various positions, most recently as a senior manager in software
development. Currently Mr. Fuentes sits on the WESTEC Advisory Board. He
received a B.S. degree majoring in Aeronautical Engineering with a second major
in Computer Science from
Embry-Riddle Aeronautical University.
 
 Mr.
Owings joined the Board in August of 2007.  Mr. Owings serves on both
the Audit and Governance Committees, and is Chairman of the Compensation
Committee.  Mr. Owings is currently employed as Vice President,
Finance of Nortel Networks (NYSE: NT), and has responsibility for the Carrier
Networks business, NT’s largest segment. The Carrier Networks business is a
global provider of hardware and software solutions for the wire line and
wireless telecommunications industry. Prior to joining Nortel, Mr. Owings served
as Chief Financial Officer of Ygomi LLC, a privately held technology firm based
in Oak Brook, IL, Air Products and Chemicals, Inc, (NYSE: APD) in Allentown, PA,
and the Personal Communications Sector of Motorola, Inc. (NYSE:
MOT).  Mr. Owings has a BS, in Accountancy and a Masters in Business
Administration from Northern Illinois University.  He is
also a member of the Executive Advisory Board of the Northern Illinois
University School of Business.
 
 Mr. Thode
received his BSEE from the University of Illinois, his MSEE from Illinois
Institute of Technology, and his Master of Management from
J.L. Kellogg School of Management at Northwestern University. He
joined Motorola in 1979, and for the next 25 years held numerous titles
throughout its wireless industry businesses, including the Wireless Network
Systems Group and the CDMA Systems Group. He has broad experience in wireless
network infrastructure and handsets. He has led large product development and
engineering teams. He has also negotiated substantial supplier and customer
contracts and structured numerous strategic relationships. Most recently he
served as Vice President & General Manager, 3G Consumer Products, Personal
Communications Sector, where he created Motorola’s UMTS product lines. Before
that, he was Senior Director & General Manager, Wireless Access Systems
Division.  Mr. Thode served as the Company’s Chief Executive Officer
from January 2005 until November 2007, when he joined Dell
Corporation.
  Audit
Committee
  The Audit
Committee consists of three directors, Dr. George Calhoun (Chairman), Torbjorn
Folkebrant and John Owings, all of whom are “independent” as defined by the
rules of the Securities and Exchange Commission and American Stock Exchange
(“AMEX”). The Board of Directors has determined that Dr. Calhoun is an “Audit
Committee financial expert” as defined in regulations of the Securities and
Exchange Commission under the Sarbanes-Oxley Act of 2002.
 2
 Table of Contents
 Code
of Conduct
  The
Company has a Code of Business Conduct and Ethics, which was attached as an
exhibit to the Company’s 2003 Annual Report on Form 10-K, filed with the SEC on
March 30, 2004. The Company requires all employees, officers and directors to
adhere to this Code in addressing the legal and ethical issues encountered in
conducting their work. The Code of Business Conduct and Ethics requires that the
Company’s employees avoid conflicts of interest, comply with all laws and other
legal requirements, conduct business in an honest and ethical manner, and
otherwise act with integrity and in the Company’s best interest. The Company’s
Code of Business Conduct and Ethics is intended to comply with Item 406 of the
SEC’s Regulation S-K and the rules of the American Stock Exchange.
  The Code
of Business Conduct and Ethics includes procedures for reporting violations of
the Code, which are applicable to all employees. The Sarbanes-Oxley Act of 2002
requires companies to have procedures to receive, retain and treat complaints
received regarding accounting, internal accounting controls or auditing matters
and to allow for the confidential and anonymous submission by employees of
concerns regarding questionable accounting or auditing matters. The Code of
Business Conduct and Ethics also includes these required
procedures.
  Compensation
Committee Interlocks and Insider Participation
  During
2007, John Owings became Chairman of the Compensation Committee of the Board of
Directors. Mr. Owings does not currently serve, nor has he ever served, as an
officer of the Company. There are no compensation committee interlocks between
the Company and any other entity involving the Company’s or such entity’s
executive officers or board members. Mr. Folkebrant, who joined the Compensation
Committee during 2008, is neither an officer of the Company nor does he have any
similar interlocks.  Mr. Pini served as acting Chief Executive Officer
from the date of Mr. Thode’s termination of employment during November 2007 and
until Mr. Reichard was hired in March 2008.  Following the hiring of
Mr. Reichard, Mr. Pini ceased to be an officer of the Company, and has never had
any interlock.
  Meetings
 
 During
the year ended December 31, 2007, the Board held 10 meetings. Except for Mr.
Fenger, who each attended 40% of the Board meetings, each director attended at
least 75% of the aggregate of the number of Board meetings (during the period of
his service as a director). The Audit Committee held 8 meetings during
2007.   Except for Mr. Fenger, who attended 38%, each
director attended at least 75% of the aggregate number of meetings (during the
period of his service as a director). The Company does not have a formal policy
regarding director attendance at Annual Meetings of Stockholders. However, the
Company does ask directors to use their best efforts to be available for, and
attend, the Annual Meeting of Stockholders. All directors except Mr. Fenger
attended the 2007 Annual Meeting of Stockholders.
 
 Independent
Directors
 
 The Board
has determined that Dr. Calhoun and Messrs. Folkebrant and Owings are each
“independent” pursuant to Section 121A of the American Stock Exchange (“AMEX”)
rules.  Mr. Pini is also independent, and though his recent service as
interim CEO makes him unable to serve on the Audit Committee, he is properly
able to serve as an independent director and member of the Compensation and
Governance committees.
  Committees
of the Board
 
 The Board
has established an Audit Committee, a Compensation Committee, and a Corporate
Governance Committee each of which is comprised entirely of “independent
directors” as that term is defined under Securities and Exchange Commission
(“SEC”) and AMEX rules.
 
 The Audit
Committee, established in accordance with Section 3(a)(58)(A) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), consists of three
directors, Dr. Calhoun (Chairman), Mr. Owings and Mr. Folkebrant. Mr. Powers
served on the Committee until he retired from the Board during June 2007, when
his place was taken by Mr. Fuentes prior to the acquisition of Clarity, and
ultimately Mr. Owings.  Mr. Fenger served on the Committee during 2007
and ultimately terminated Board service during 2008, with his position in the
Audit Committee taken by Mr. Folkebrant.  All of these directors
were/are “independent” as defined by the rules of the SEC and AMEX. The Board of
Directors has determined that Dr. Calhoun is an “Audit Committee financial
expert” as defined in regulations of the SEC under the Sarbanes-Oxley Act of
2002. The Audit Committee has responsibility for selecting the Company’s
independent auditors, reviewing the plan and scope of the audit, approving any
non-audit services provided by the Company’s independent auditors, reviewing the
Company’s audit and control functions, oversight of the Company’s insider
trading policy and reporting to the full Board regarding all of the foregoing.
The Audit Committee held eight meetings in 2007.  3
 Table of Contents
 
 The
Compensation Committee consists of Mr. Owings (Chairman), Mr. Pini and Mr.
Folkebrant.  Dr. Singer was a member of the Compensation Committee
until March 2007, when he terminated Board service. Mr. Powers retired from the
Board and the Committee during June 2007.  Mr. Fuentes served on the
Committee prior to the acquisition of Clarity by ISCO.  The
Compensation Committee has responsibility for recommending to the Board
guidelines and standards relating to the determination of executive
compensation, reviewing the Company’s executive compensation policies and
reporting to the full Board regarding the foregoing. The Compensation Committee
also has responsibility for administering the Company’s 2003 Equity Incentive
Plan, as amended (the “2003 Plan”), determining the number of options and shares
of restricted stock to be granted to the Company’s executive officers and
employees pursuant to the 2003 Plan and reporting to the full Board regarding
the foregoing functions. The Compensation Committee has responsibility for
approving all executive compensation, has oversight authority over Management
recommendations for the compensation of other employees, and must specifically
approve each award under the 2003 Plan, regardless of the award level or
recipient. The CEO will from time to time prepare analyses of Company and/or
individual performance, including of Named Executive Officers (NEOs) and may
recommend a specific course of action. Ultimately the Compensation Committee, in
conjunction with the full Board for significant items as it and the Board deem
appropriate (such as final approval of a new employment agreement with the CEO),
has the authority to accept, change, or reject these analyses and/or
recommendations. The Compensation Committee may retain and terminate
compensation consultants and/or attorneys to assist in the evaluation of
director, CEO, executive officer, or other compensation, including the sole
authority to approve related consultant/legal fees and other retention
terms. The Compensation Committee held four meetings in 2007.
 
 The
Corporate Governance Committee was formed during 2004 and consists of Mr. Pini
(Chairman), Mr. Owings and Mr. Folkebrant.  Mr. Fuentes served on this
Committee prior to the acquisition of Clarity by ISCO, and Mr. Fenger served on
this Committee prior to the termination of his Board service during
2008.  The Corporate Governance Committee acts as both the Board’s
corporate governance committee and nominating committee. The Corporate
Governance Committee reviews and makes recommendations to the Board regarding
Board organization, membership (including the identification and recommendation
of potential candidates for election to the Board), function and effectiveness,
and committee structure, membership, function and effectiveness. The Corporate
Governance Committee evaluates the performance of the Board as a whole, the
Committees and the individual directors. The Corporate Governance Committee held
four meetings during 2007.
  Director
Nominations
 
 The
Corporate Governance Committee currently serves as our nominating committee. The
Corporate Governance Committee seeks director candidates based upon a number of
qualifications, including their independence, knowledge, judgment, character,
leadership skills, education and experience. The Corporate Governance Committee
particularly emphasizes significant experience in the wireless
telecommunications industry.
 
 As part
of the process of selecting Board candidates, the Corporate Governance Committee
reviews the appropriate skills and characteristics required of Board members.
The Corporate Governance Committee does not generally rely upon third-party
search firms to identify board candidates. Instead, it relies on recommendations
from a wide variety of its business contacts, including current executive and
other officers, directors and stockholders, as a source for potential Board
candidates. The Corporate Governance Committee evaluates the above criteria as
well as the current composition of the Board and the need for audit committee
expertise. The Corporate Governance Committee then recommends to the Board for
nomination the candidates which it believes best suit the needs of the
Company.
 In
accordance with the provisions of our By-Laws, a stockholder entitled to vote at
such meeting may nominate candidates for election to the board of
directors.
 
 A
stockholder who wishes to nominate a director candidate must timely deliver a
notice to the Secretary of the Company delivered to, or mailed and received by,
the Secretary of the Company at the principal executive offices of the Company
at 1001 Cambridge Drive, Elk Grove Village, IL 60007. To be timely, the
notice must be delivered not less than 60 days nor more than 90 days prior to
the meeting; provided, however, that if the Company has not publicly disclosed
(in the manner provided in the By-Laws) the date of the meeting at least 70 days
prior to the meeting date, the notice must be received not later than the close
of business on the tenth day following the day on which the Company publicly
discloses the meeting date.
 
 To be in
proper written form, a stockholder’s notice to the Secretary must set forth (a)
as to each person whom the stockholder proposes to nominate for election as a
director all information relating to the person that would be required to be
disclosed in solicitations of proxies for election of directors, or is otherwise
required, in each case pursuant to Regulation 14A of the Exchange Act, including
such person’s written consent to being named in the proxy statement as a nominee
and to serving as director if elected; and (b) as to the stockholder giving the
notice (i) the name and record address of such stockholder as they appear on the
Company’s books and (ii) the number of shares of the Company which are
beneficially owned by such stockholder, by class and series.
 
 Stockholders’
nominees that comply with these procedures will receive the same consideration
at the Annual Meeting of Stockholders that other nominees receive. 
 4
 Table of Contents
  Policy
for Stockholder Communication with Directors
 
 Stockholders
may communicate with the members of the Board of Directors, either individually
or collectively, by writing to the Board at 1001 Cambridge Drive, Elk Grove
Village, IL 60007. These communications will be reviewed by the office of
the Company’s Corporate Secretary as agent for the non-management directors in
facilitating direct communication to the Board of Directors. The Secretary’s
office will treat communications containing complaints relating to accounting,
internal accounting controls, or auditing matters as reports under the Company’s
Whistleblower Policy. Further the Secretary’s office will disregard
communications that are bulk mail, solicitations to purchase products or
services, not directly related either to the Company or to the non-employee
directors’ roles as members of the Board, sent other than by stockholders in
their capacities as such or from particular authors or regarding particular
subjects that the non-employee directors may specify from time to time, and all
other communications which do not meet the applicable requirements or criteria
described below, consistent with the instructions of the non-employee
directors.
 
 General
Communications
 
 The
Secretary’s office will summarize all stockholder communications directly
relating to the Company’s business operations, its Board, its officers, its
activities or other matters and opportunities closely related to the Company.
This summary and copies of the actual stockholder communications will then be
circulated to the Chairman of the Corporate Governance Committee on a biweekly
basis.
 
 Stockholder
Proposals and Nominations
 
 Stockholder
proposals are reviewed by the Secretary’s office for compliance with the
requirements for such proposals set forth in the Company’s Bylaws and in Rule
14a of the Exchange Act and as described in this Statement. Stockholder
proposals that meet these requirements will be summarized by the Secretary’s
office. Summaries and copies of the stockholder proposals are circulated to the
Chairman of the Corporate Governance Committee.
 
 Stockholder
nominations for directors are reviewed by the Secretary’s office for compliance
with the requirements for such nominations that are set forth in the Company’s
Bylaws and as described in this Proxy Statement. Stockholder nominations that
meet these requirements are summarized by the Secretary’s office. Summaries and
copies of the nominations are circulated to the Chairman of the Corporate
Governance Committee.
 
 Retention
of Shareholder Communications
 
 Any
stockholder communications which are not circulated to the Chairman of the
Corporate Governance Committee because they do not meet the applicable
requirements or criteria described above will be retained by the Secretary’s
office for at least ninety calendar days from the date on which they are
received, so that these communications may be reviewed by the non-employee
directors to whom they were addressed should any of the non-employee directors
elect to do so.
  Distribution
of Shareholder Communications
 
 Except as
otherwise required by law or upon the request of a non-employee director, the
Chairman of the Corporate Governance Committee will determine when and whether a
stockholder communication should be circulated among one or more members of the
Board and/or Company management.
 
  Executive
Officers
  Set forth
below is a table identifying executive officers of the Company who are not
identified in the tables entitled “Directors.” Biographical information for Mr.
Reichard, Mr. Fuentes and Dr. Abdelmonem are set forth above under
“Directors.”
  Name
              
              Age
              
              Position
      with CompanyFrank
      Cesario
              
              38
              
              Chief
      Financial Officer
 
  5
 Table of Contents
 Mr.
Cesario joined the Company during August 2000 as Controller and served as Acting
Chief Financial Officer beginning April 2002 and has served as Chief Financial
Officer since December 2002. Previously, Mr. Cesario was Group Controller for
copper and brass producer Outokumpu Copper, Inc. and subsidiaries, a U.S. group
with approximately $500 million in annual revenue and owned by Helsinki-based
Outokumpu Oyj. Mr. Cesario has an MBA (Finance) from DePaul University in
Chicago, a B.S. in Accountancy from the University of Illinois, and began his
career at KPMG Peat Marwick.
  The Board
of Directors elects officers annually and such officers, subject to the terms of
certain employment agreements, serve at the discretion of the Board. See
“Executive Compensation”. The Company has entered into employment agreements
with Mr. Reichard, Mr. Fuentes, Dr. Abdelmonem and Mr. Cesario. There are no
family relationships among any of the directors or executive officers of the
Company.
  Section
16(a) Beneficial Ownership Reporting Compliance
  Section
16(a) of the Securities Exchange Act of 1934, as amended, requires the Company’s
officers (as defined under Section 16(a) of the Securities Exchange Act),
directors and persons who own greater than 10% of a registered class of the
Company’s equity securities to file reports of ownership and changes in
ownership with the SEC. Based solely on a review of the forms it has received
and on written representations from certain reporting persons that no such forms
were required for them, the Company believes that during 2007 and through the
date of this report , except for the initial filing for Mr. Folkebrant upon
becoming a director, subsequently reported on Form 3 by Mr. Folkebrant, the
forfeiture of 2,000,000 shares of common stock by Amr Abdelmonem and the
forfeiture of 4,000,000 and termination of an additional 500,000 shares by John
Thode, all of which awards and purchases were subsequently reported on Form 4 by
the respective filers, all of the Section 16(a) filing requirements applicable
to its officers, directors and 10% beneficial owners were complied with by such
persons.
  Item
11.  Executive Compensation
  The
following table provides information concerning the annual and long-term
compensation for services in all capacities to the Company for the years ended
December 31, 2007 and 2006 of (i) each person who served as the Company’s chief
executive officer and (ii) the two most highly compensated executive officers
whose salary and bonus for services rendered in all capacities to the Company
for the fiscal year ended December 31, 2007 exceeded $100,000 (collectively, the
“Named Executive Officers”).
  Director
CompensationThe following
Director Compensation table sets forth information concerning compensation for
services rendered by directors of the Company for fiscal year
2007.
 
 Name
              
              Fees Earned or
                Paid in Cash
                ($)
              
              Stock Awards
                ($)
              
              Option Awards
                ($)
              
              Non-Equity
                Incentive
      Plan
                Compensation
                ($)
              
              Changein
      PensionValue
                andNonqualifiedDeferred
                CompensationEarnings
                ($)
              
              All
      Other
                Compensation
                ($)
              
              Total
                ($)James
      Fuentes (4)
              $
              31,600
              $
              10,800
              
              None
              
              None
              
              None
              
              None
              $
              42,400Dr.
      George Calhoun
              $
              28,600
              $
              9,700
              
              None
              
              None
              
              None
              
              None
              $
              38,300Michael
      Fenger (1)
              $
              14,400
              $
              4,600
              
              None
              
              None
              
              None
              
              None
              $
              19,000Ralph
      Pini (5)
              $
              26,600
              $
              9,300
              
              None
              
              None
              
              None
              
              None
              $
              35,900Tom
      Powers (2)
              $
              15,000
              $
              5,200
              
              None
              
              None
              
              None
              
              None
              $
              20,200John
      Owings
              $
              11,300
              $
              3,300
              
              None
              
              None
              
              None
              
              None
              $
              14,600
 
 (1)
              Mr.
      Fenger left the Board of Directors during
2008
 (2)
              Mr.
      Powers retired from the Board of Directors during June
  2007
 (3)
              Mr.
      Folkebrant joined the Board of Directors during
  2008
 (4)
              Mr.
      Fuentes did not become an employee of the Company until January 2008, and
      thus received compensation as a non-employee
  director
 (5)
              Mr.
      Pini was not compensated as a non-employee director while he served as
      interim CEO (November 2007 – March
2008)
 6
 Table of Contents
 Stock
award value is based on the price of the Company’s stock on the date of grant,
consistent with the Company’s accounting expense for such grants under FAS
123(R). Directors are paid for service, capacity and committee involvement. The
Company does not pay for meetings, beyond reimbursement of reasonable expenses,
nor does the Company penalize directors for failing to attend a minimum number
or percentage of meetings.
  During
2007 the Company provided Non-Employee Directors, in addition to certain cash
payments as described below, a grant of 25,000 restricted shares of the
Company’s common stock, a grant of 12,500 restricted shares of common stock for
service as the chairman of the Board of Directors or one of the Board’s three
committees, and a grant of 7,500 restricted shares of common stock for service
on a Board committee. All such grants vest over one year on a quarterly basis on
September 15, December 15, March 15 and June 15 of the service year. This
compensation is intended to vest as closely as practical to the relevant service
period, in this case from the June 2007 annual meeting of
shareholders.
  During
2007 the Board also provided cash payments to Non-Employee Directors for their
service to the Company. Under this program, non-employee directors received
$1,800 per month for serving on the Board. In addition, the respective Chairmen
of the Board and the three committees (Audit, Compensation, and Governance) each
received $400 per month for such service. Non-Employee Directors who serve on
these committees in roles other than chairman each received $300 per month. This
2007 program was, and is, intended to be an annual program until such time as
the program is changed.
  All
non-employee directors are reimbursed for their reasonable out-of-pocket
expenses incurred in attending Board and Committee meetings.


Summary
Compensation Table
   Salary
                ($)
              Bonus
                ($)
              Stock
                Awards
                ($)
              Options
                Awards
                ($)
              Non
      Equity Incentive Plan Compensation Plan
                ($)
              Change
      in Pension Value and Nonqualified Deferred Compensation Earnings
                ($)
              All
      Other Compensation
                ($)
              Total
                ($)John Thode (1)President and
      Chief Executive Officer2007
              322,000
              -
              160,000
              -
              -
              -
              -
              482,0002006
              300,000
              50,000
              320,000
              -
              -
              -
              -
              670,000Dr.
      Amr Abdelmonem (2)Chief
      Technology Officer2007
              255,000
              -
              277,500
              -
              -
              -
              -
              532,5002006
              250,000
              7,500
              277,500
              -
              -
              -
              -
              535,000Frank CesarioChief
      Financial Officer2007
              180,000
              -
              68,750
              -
              -
              -
              -
              248,7502006
              172,000
              15,000
              47,675
              -
              -
              -
              -
              234,675
      
  7
 Table of Contents
 OUTSTANDING
EQUITY AWARDS AT DECEMBER 31, 2007 and 2006:
   Option
      Awards
              
              
              
              
              Stock
              AwardsNumber of Securities Underlying Unexercised
      Options (#)
              Number
      of Securities Underlying Unexercised Options (#)
              Equity
      Incentive Plan Awards: Number of Securities Underlying Unexercised
      Unearned Options
              Option
      Exercise Price
              Option
      Expiration Date
              
              Number
      of Shares or Units of Stock That Have Not Vested
              Market
      Value of Shares or Units of Stock That Have Not Vested
              Equity
      Incentive Plan Awards: Number of Unearned Shares, Units of Other Rights
      That Have Not Vested
              Equity
      Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or
      Other Rights That Have Not VestedName
              Exerciseable
              Unexercisable
              (#)
              ($)
              (1)
              
              (#)
              ($)
              (#)
              ($)As of December
      31, 2007John Thode
              1,100,000
              -
              -
              $ 0.43
              2/2/2008
              
              -
              -
              -
              -Dr. Amr.
      Abdelmonem
              262,499
              -
              -
              $ 0.11
              1/1/2013
              
              -
              -
              -
              -Frank Cesario
              -
              -
              -
              -
              -
              
              187,500
              $ 35,625
              -
              -As of December
      31,2006John Thode
              1,100,000
              -
              -
              $ 0.43
              2/2/2008
              
              1,000,000
              $ 340,000
              2,000,000
              $ 680,000Dr. Amr
      Abdelmonem
              262,499
              -
              -
              $ 0.11
              1/1/2013
              
              750,000
              $ 255,000
              1,000,000
              $ 340,000Frank Cesario
              -
              -
              -
              -
              -
              
              375,000
              $ 127,500
              -
              -
   
  PENSION
BENEFITS
  The
Company does not have a defined-benefit pension or similar program. It maintains
a Defined Contribution 401(k) program.
  
 2007 and 2006 NON-QUALIFIED DEFERRED
COMPENSATION
 The
Company had no such programs to disclose.
 
 8
 Table of Contents
  EMPLOYMENT
AGREEMENTS AND POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN
CONTROL
 
 Reichard Employment
Agreement
 
 On March
10, 2008, the Company entered into an employment agreement with Mr.
Reichard.  The term of the agreement is for two years; provided
however, that upon the eighteen-month anniversary of the Effective Date and each
day thereafter, the term of the Employment Agreement will be extended for one
additional day unless the Company provides written notice to Mr. Reichard that
it will not extend the term.  Mr. Reichard’s annual base salary will
be $250,000 for the first twelve months.  Prior to the 12 month
anniversary of the agreement, the Company and Mr. Reichard will negotiate in
good faith an increase in base salary for months 13 through 24.  Mr.
Reichard is also eligible for a cash performance bonus of up to $80,000,
provided the Company achieves certain mutually agreed upon performance
goals.  Bonus payments will be payable promptly upon the Company’s
conclusion that the performance measures have been achieved, and in no event,
later than the filing date of the Company’s Annual Report on Form 10-K for that
particular year.  Mr. Reichard will be able to participate in the
Company’s benefit plans, subject to applicable eligibility and participation
requirements.  Mr. Reichard’s employment may be terminated at any
time.  If the Company terminates Mr. Reichard without Cause or Mr.
Reichard resigns from the Company for Good Reason (each as defined in the
employment agreement) prior to six months of continuous employment, Mr. Reichard
will receive monthly severance payments equal to 1/12th of his base salary for a
period of three months, in addition to accrued but unpaid base salary and any
accrued but unused vacation as of the date of termination.  If the
Company terminates Mr. Reichard without Cause or Mr. Reichard resigns from the
Company for Good Reason after six months of continuous employment, Mr. Reichard
will receive monthly severance payments equal to 1/12th of his base salary for a
period of six months, in addition to accrued but unpaid base salary and any
accrued but unused vacation as of the date of termination.  If Mr.
Reichard’s employment is terminated for any other reason, including termination
by the Company for Cause, Mr. Reichard will be entitled to payment of accrued
and unpaid salary and accrued but unused vacation through the date of such
termination.  Mr. Reichard’s employment agreement also contains
customary restrictive covenants, including non-competition and non-solicitation
provisions for a period of two years following the cessation of
employment.
 
 In
addition to the employment agreement, the Company also entered into a restricted
stock award agreement (“Reichard Stock Agreement”) with Mr. Reichard, pursuant
to which the Company granted Mr. Reichard 2,000,000 shares of restricted stock
(the “Reichard Restricted Shares”).  Under the Richard Stock
Agreement, Mr. Reichard is eligible for additional grants of up to 3,000,000
shares (the “Reichard Performance Shares”).  The Reichard Restricted
Stock shall, if Mr. Reichard has been continuously employed through the vesting
date, to the Company, as applicable, through the following dates, vest pursuant
to the following schedule: i) 250,000 on March 17, 2008; ii) an additional
250,000 on August 30, 2008; iii) an additional 500,000 on February 28, 2009; iv)
an additional 500,000 on August 30, 2009; v) an additional 250,000 on February
28, 2010; and vi) an additional 250,000 on August 30, 2010.  For
fiscal years 2008 and 2009, Mr. Reichard is eligible, upon attainment of
performance goals determined by the Company, for grants of up to 1,500,000 of
additional restricted shares for each fiscal year as follows: 500,000 shares
upon attainment of 80% of the specified performance goals, 1,000,000 total
shares upon achievement of 100% of the specified performance goals and 1,500,000
total shares upon achievement of 130% of the specified performance goals, or an
interpolated amount for accomplishing between 100% and 130% of approved
performance goals.  For the 2009 fiscal year, additional restricted
shares and/or cash compensation may be considered by the Compensation Committee
if performance exceeds 130% of specified goals.
 
 Upon
termination of Mr. Reichard’s service to the Company for any reason or for no
reason, any shares of Reichard Restricted Stock which have not prior to the
effective date of such termination become vested will be forfeited and no
additional Reichard Performance Shares will be issued.  However, if,
Mr. Reichard is terminated without Cause prior to December 15, 2009, 250,000
shares of Reichard Restricted Shares will vest as of the date of the
termination.  If there occurs a Change in Control of the Company (as
defined in the Reichard Restricted Stock Agreement) prior to December 31, 2009
and Mr. Reichard remains in continuous service to the Company through the date
of that Change in Control, then immediately prior to (but contingent upon) the
occurrence of that Change in Control any unvested Reichard Restricted Stock will
vest and the Reichard Performance Shares otherwise subject to issuance under the
Reichard Restricted Stock Agreement based on performance in the fiscal year of
the Change in Control will be issued to the extent that performance for the
portion of that year that transpires prior to the Change in Control meets or
exceeds a pro-rata portion of the performance goals specified by the Board for
that year.  The Reichard Restricted Stock and the Reichard Performance
Shares were granted pursuant to the terms of the 2003 Plan.
 
 Abdelmonem
Employment Agreement
 
 On
February 19, 2008, the Company entered into an Agreement with Dr. Amr Abdelmonem
to include his service as the Company’s Chief Operating Officer in addition to
his continued service as the Company’s Chief Technology Officer.  This
agreement replaced the employment agreement between Mr. Abdelmonem and the
Company dated January 1, 2006 (the “Prior Employment Agreement”). Except as
noted below with respect to his annual bonus opportunity, this new agreement
continues Dr. Abdelmonem’s employment with the Company on substantially the same
terms, including salary, as under the Prior Employment
Agreement.  Under Dr. Abdelmonem’s employment agreement, Dr.
Abdelmonem’s annual base salary is $255,000, subject to future adjustment as
determined by the Compensation Committee.
 9
 Table of Contents
  Under the
Prior Employment Agreement, Dr. Abdelmonem was eligible for a cash annual bonus
of between 25 and 100 percent of his base salary, based on the achievement of
performance goals established by the Board or the Compensation
Committee.  Under the new employment agreement, Dr. Abdelmonem
continues to be eligible for an annual bonus based on the achievement of
corporate and individual goals established by the Board or the Compensation
Committee, but that bonus will generally be paid in shares of restricted stock,
with up to 1,000,000 restricted shares with immediate vesting may be awarded.
The Board reserves the right, in its discretion, to make additional awards in
cash or stock for extraordinary performance in excess of plan
goals.  No bonus will be payable to Dr. Abdelmonem with respect to a
given year if he fails to be employed by the Company through the first day of
the following year (or, in the case of a termination by the Company for cause,
through the date of actual bonus payment).  Dr. Abdelmonem’s
employment may be terminated at any time. If the Company terminates Dr.
Abdelmonem without cause or Dr. Abdelmonem resigns for good reason (as defined
in the employment agreement), he will receive a lump sum payment equal to 50% of
his base salary, any annualized bonus earned for the fiscal year of termination,
and waiver of the applicable premium for COBRA continuation coverage in the
Company’s health plan(s) for a period of six months. If the Company terminates
Mr. Abdelmonem for cause (as defined in the employment agreement), he will be
entitled only to the payment of accrued and unpaid salary through the date of
such termination. The employment agreement also contains customary restrictive
covenants, including a covenant not to compete with the Company for a period of
six months following the cessation of his employment.
  In
connection with his continued employment, the Company also entered into a
restricted stock agreement (the “Abdelmonem Restricted Stock Agreement”) with
Dr. Abdelmonem, pursuant to which the Company granted Dr. Abdelmonem 1,200,000
shares of restricted common stock (the “Abdelmonem Restricted Stock”). The
Restricted Stock was granted under the 2003 Plan, and is subject to vesting
based on Dr. Abdelmonem’s continued service to the Company over a period of
approximately 23 months (subject to acceleration upon a change in control of the
Company).  In addition, as contemplated by the New Employment
Agreement, Dr. Abdelmonem is eligible for a grant request to the Compensation
Committee of the Board of Directors for each of the 2008 and 2009 fiscal years
equal to 300,000 restricted shares upon achievement of 80% of specified
performance goals, a total of 650,000 restricted shares upon achievement of 100%
of specified performance goals, and a total of 1,000,000 restricted shares upon
achievement of 130% of specified performance goals, or an interpolated amount
for accomplishing between 100% and 130% of approved performance goals. For the
2009 fiscal year only, additional restricted shares and/or cash compensation may
be considered by the Compensation Committee if performance exceeds 130% of
goals.  All such performance-based restricted shares will vest on the
filing date of the Company’s Form 10-K for each of the 2008 and 2009 fiscal
years, as applicable, if Dr. Abdelmonem remains continuously employed by the
Company through that filing date and the performance goals specified by the
Company with respect to that fiscal year have been achieved.  The
performance goals, which may include intermediate goals, the achievement of
which will result in partial vesting, will be determined by the Company, based
on the Company’s operating plan for the applicable year, and will be
communicated to Dr. Abdelmonem not later than 90 days following the start of the
applicable year.
 
 Cesario
Employment Agreement
 
 On
February 6, 2006, the Company entered into an Agreement with Mr. Cesario to
continue to serve as the Company’s Chief Financial Officer (the “Cesario
Employment Agreement”).  Mr. Cesario’s annual base salary was $172,000
as of the effective date of the Cesario Employment Agreement and was $180,000
for 2007. Mr. Cesario was awarded a cash bonus of $15,000 that paid promptly.
Mr. Cesario also received a grant of 250,000 shares of common stock that will
vest on a quarterly basis over the following two years. Mr. Cesario is eligible,
subject to the Company’s incentive compensation programs as they may change from
time to time, to receive an additional 125,000 restricted shares of common stock
if the Company exceeds its annual business plan by 50%, or 250,000 restricted
shares of common shares of common stock if the Company exceeds its annual
business plan by 100%. Such shares, if granted, would vest semi-annually over
two years from the date of such award. In addition, Mr. Cesario is eligible for
a cash bonus of up to 25% of his annual salary based upon meeting mutually
agreed upon goals. Mr. Cesario is eligible to participate in the Company’s
benefit plans, subject to applicable eligibility and participation
requirements.   Mr. Cesario’s employment may be terminated at any
time. If the Company terminates Mr. Cesario without Cause (as defined in the
Cesario Employment Agreement), he will receive his base salary for three months,
as well as any bonus earned during his employment period and any vested equity
awards as of his termination date.
 
 10
 Table of Contents
 Fuentes
Employment Agreement
 
 Mr.
Fuentes became an employee of the Company upon the consummation of the
acquisition of Clarity and pursuant to an employment
agreement.  Pursuant to the employment agreement, Mr. Fuentes will
report to the Company’s Chief Executive Officer (“CEO”) to assist the CEO in the
coordination and integration of the Company’s operations with the combined
entity and perform such other duties as the CEO may assign to Mr.
Fuentes.  During the term of the employment agreement, Mr. Fuentes’
base salary is $240,000 per year.  The term of the employment
agreement is for two years; provided, however, that upon the eighteen month
anniversary of the start of his employment and each day thereafter, the term of
the agreement will be extended for one additional day unless and until the
Company provides written notice to Mr. Fuentes that such extension will not
occur.  If Mr. Fuentes’ employment ceases due to a termination by the
Company other than for Cause or by Mr. Fuentes for Good Reason (as those terms
are defined in the employment agreement), then subject to Mr. Fuentes’
compliance with certain covenants, Mr. Fuentes will receive (i) monthly
severance payments equal to 1/12th of his annual base salary for the lesser of:
(x) three months or (y) the number of whole months remaining in the term of the
agreement as of the date of his termination and (ii) any accrued but unpaid base
salary and any accrued but unused vacation as of the date of Mr. Fuentes’
termination.  Mr. Fuentes will continue to serve on ISCO’s Board at
least for the remainder of his term as director.
 
 Thode
Employment Agreement
 
 On
January 10, 2006, the Company entered into an agreement with Mr. Thode, to
continue to serve as the Company’s President and Chief Executive Officer (the
“Thode Employment Agreement”). This agreement superseded the letter agreement
between Mr. Thode and the Company, dated January 6, 2005.  Mr. Thode’s
annual base salary was $300,000 in 2006 and $350,000 in 2007, and shall was
subject to future adjustment as determined by the Compensation Committee of the
Board of Directors (the “Compensation Committee”).  Mr. Thode was also
entitled to certain performance bonuses, provided the Company achieves certain
specified performance goals as determined by the Compensation Committee.
Additionally, the Company’s stockholders approved the issuance of 6,000,000
shares of restricted stock to Mr. Thode as further incentive and compensation.
The restricted stock was subject to both a time vesting and a performance
vesting component, as further described in the form of restricted stock award
agreement attached as an exhibit to the Thode Employment
Agreement.  Mr. Thode was also granted a signing bonus of $50,000,
which was paid promptly following the execution of the Thode Employment
Agreement. Mr. Thode was able to participate in the Company’s benefit plans,
subject to applicable eligibility and participation requirements.
  Mr.
Thode’s employment may be terminated at any time. If the Company terminates Mr.
Thode without Cause or Mr. Thode resigns for Good Reason (both as defined in the
Thode Employment Agreement), he will receive a lump sum payment equal to his
base salary, an annual bonus for the fiscal year of termination, and waiver of
the applicable premium for COBRA continuation coverage in the Company’s health
plan(s) for a period of twelve months. If the Company terminates Mr. Thode for
cause (as defined in the Thode Employment Agreement), he will be entitled only
to the payment of accrued and unpaid salary through the date of such
termination. The Thode Employment Agreement also contains customary restrictive
covenants, including a covenant not to compete with the Company for a period of
twelve months following the cessation of his employment.
 
 During
October 2007, John Thode tendered his resignation as the Company’s President and
CEO.  The Thode Employment Agreement was terminated in conjunction
with Mr. Thode’s resignation from the Company.  Mr. Thode remained a
member of the Board.
 
 11
 Table of Contents
 Item 12. Security Ownership of Certain Beneficial Owners and
Management and Related Stockholder Matters
  Equity
Compensation Plan Information
  The
following table gives information about the Company’s common stock that may be
issued upon the exercise of options, warrants and rights under the Company’s
1993 Plan and under the 2003 Equity Incentive Plan as of December 31,
2007.
       Plan Category
              Number
      of Securities to be issued upon exercise of outstanding Options, warrants
      and rights
              Weighted-average
      exercise price of outstanding options, warrants and rights
              Number
      of Securities remaining available for future issuance under equity
      compensation plans (excluding securities reflected in second
      column)Equity
      compensation plans approvedby security holders
              7,327,892
              $ 0.36
              23,896,541
      (1)Equity
      compensation plans not approved by security holders
              1,100,000
              $ 0.43
              -
  (2)Total
              8,427,892
              $ 0.37
              23,896,541
      (1)
   (1)  The
1993 Plan terminated in August 2003 and was replaced by the Plan. At the Annual
Meeting of Stockholders held in December 2005, the Company's stockholders voted
to approve the allocation of 12 million shares  of  common
stock to the Plan, included above, and also clarified the use of up to 5 million
shares in the Plan that were allocated to the 1993 Plan but were ultimately
unused. During the Annual Meeting of Stockholders held in June 2006, the
Company's stockholders voted to approve an additional increase to the Plan of 6
million shares of common stock that corresponded to a grant of restricted shares
to John Thode that was not contemplated at the time of the December 2005
increase. During a sepcial meeting of stockholders held in December 2007, the
Company's stockholders increased the number of shares of common stock in the
Plan by 15 million shares. Of that number, approximately 13 million shares are
reserved for issuance to the Clarity employees who remained with the combined
entity following the merger in accordance with the terms of the merger
agreement. This reservation is not deducted from the outstanding number of
shares as of December 31, 2007 in the table above.
  (2) These
securities represent shares of Common Stock issuable upon exercise of stock
options granted to John Thode pursuant to a letter agreement dated January 2005.
Such options were issued outside the Plan.
 
 
 The
following table sets forth information regarding the beneficial ownership of
Common Sock as of March 31, 2008, except as otherwise indicated in the relevant
footnote, by (1) each person or group that the Company knows beneficially owns
more than 5% of Common Stock, (2) each of the Company’s directors and director
nominees, (3) the Named Executive Officers, and (4) all current executive
officers and directors as a group. Unless otherwise indicated, the address of
each person identified below is c/o the Company at its principal executive
offices.
 12
 Table of Contents
  
 The
percentages of beneficial ownership shown below are based on 223 million shares
of Common Stock outstanding as of March 31, 2008, unless otherwise stated.
Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and generally includes those securities over
which a person may exercise voting or investment power. In addition, shares of
Common Stock which a person has the right to acquire upon the exercise of stock
options and/or warrants within 60 days of the date of this table are deemed
outstanding for the purpose of computing the percentage ownership of that
person, but are not deemed outstanding for computing the percentage ownership of
any other person. Except as indicated in the footnotes to this table or as
affected by applicable community property laws, the persons named in the table
have sole voting and investment power with respect to all shares of Common Stock
beneficially owned.
 Number of Shares
                of
      Common Stock
                Beneficially Owned
              
              
              Percent
                of Class5% StockholdersAlexander
      Finance, LP.
              
              91,420,716
              (1)
              
              35.3
              %Elliott
      Associates, L.P.
              
              55,523,835
              (2)
              
              21.3
              %Elliott
      International, L.P.
              
              19,904,159
              (2)
              
              7.7
              %Directors and Named Executive
      OfficersGordon
      Reichard, Jr.
              
              150,000
              (3)
              
              *
              %Amr
      Abdelmonem
              
              1,204,499
              (4)
              
              *George
      Calhoun
              
              1,080,041
              (5)
              
              *Torbjorn
      Folkebrant
              
              7,919
              (6)
              
              *Jim
      Fuentes
              
              13,076,564
              (7)
              
              *John
      Owings
              
              30,000
              (8)
              
              *Ralph
      Pini
              
              271,875
              (9)
              
              *John
      Thode
              
              1,057,500
              (10)
              
              *Frank
      Cesario
              
              563,870
              (11)
              
              *All
      directors and executive officers as a group (9 persons)
              
              16,376,849
              (12)
              
              7.0
              %
 
 * Less
than 1%.
 (1)
              As
      reflected in a Form 13D dated March 20, 2008. The address for Alexander
      Finance, L.P. is 1560 Sherman Avenue Evanston,
      IL 60201.  Includes affiliates.  Also includes
      approximately 43 million shares issuable upon conversion of convertible
      debt.(2)
              The
      address of Elliott Associates, L.P. is 712 Fifth Avenue, New York, New
      York 10019 and the address of Elliott International, L.P. is c/o
      Elliot International Capital Advisors, Inc. 712 Fifth Avenue New
      York, New York 10019.  Includes affiliates.  Also
      includes approximately 36 million shares issuable upon conversion of
      convertible debt.(3)
              Mr.
      Reichard joined the Company during March 2008.(4)
              Includes
      outstanding options to purchase 262,499 shares which were exercisable as
      of March 31, 2008, or within 60 days from such date.(5)
              Includes
      outstanding options to purchase 920,833 shares which were exercisable as
      of March 31, 2008, or within 60 days from such date.(6)
              Mr.
      Folkebrant joined the Company’s Board of Directors during February
      2008.(7)
              Includes
      outstanding options to purchase 160,000 shares, which were exercisable as
      of March 31, 2008, or within 60 days from such date.(8)
              Intentionally
      left blank(9)
              Includes
      outstanding options to purchase 110,000 shares, which were exercisable as
      of March 31, 2008, or within 60 days from such date.(10)
              Intentionally
      left blank(11)
              Intentionally
      left blank(12)
              Includes
      outstanding options to purchase 1,453,332 shares, which were exercisable
      as of March 31, 2008, or within 60 days from such date.
 
  13
 Table of Contents
 
 Item 13. Certain Relationships and Related Transactions and Director
Independence
  Events
during 2007
 
 Merger
with Clarity
 
 On
November 13, 2007, an Agreement and Plan of Merger (the “Merger Agreement”) was
entered into by and among ISCO, ISCO Illinois, Inc. (“Merger Subsidiary”), a
wholly owned subsidiary of ISCO, Clarity and Jim Fuentes, for himself and as the
representative of certain Clarity rightsholders.  Pursuant to the
Merger Agreement, we obtained all of the outstanding stock of Clarity through a
merger in which our wholly owned subsidiary, ISCO Illinois, Inc. (“Merger
Subsidiary”) merged with and into Clarity with Clarity being the surviving
corporation and a wholly owned subsidiary of our Company (the
“Merger”).  We issued shares of our Common Stock as consideration for
the Merger.  Mr. Fuentes was the sole stockholder and President and
Chief Executive Officer of Clarity.  Mr. Fuentes has been a member of
the Company’s Board of Directors since November 2003 and served as Chairman of
the Board from January 2006 until June 2007.
 
 Pursuant
to the Merger Agreement, ISCO will issue up to an aggregate of 40 million of its
common stock in exchange for all of Clarity’s stock, which was held entirely by
Mr. Fuentes, and satisfaction of rights under certain Clarity incentive and
compensation plans.
 
 Mr.
Fuentes will be allocated approximately 65% of the 40,000,000 shares of common
stock issuable in connection with the Merger.  Assuming Mr. Fuentes is
issued all of the shares he is eligible to receive in connection with the
Merger, Mr. Fuentes will beneficially own approximately 11% of ISCO’s
outstanding common stock.  Furthermore, Mr. Fuentes was released from
his obligation to guaranty up to $1,500,000 drawn under Clarity’s line of credit
arrangement.  In addition, the Company reimbursed certain professional
fees and expenses of Clarity relating to the Merger up to an aggregate of
$375,000.
 
 
 Employment
and Registration Rights Agreement with Jim Fuentes
 
 In
connection with the Merger, the Company entered into an employment agreement
with Mr. Fuentes, which is described under “Executive Compensation” in this
Report on Form 10-K/A.  In addition, the Company filed a registration
statement on Form S-3 with the SEC, which was declared effective February 14,
2008, pursuant to a registration rights agreement with Mr. Fuentes and certain
Clarity rightsholders covering the resale of the shares they receive in
connection with the Merger.
 
 
 2007
Loan Restructuring
 
 On June
26, 2007, the Company, Manchester, Alexander, Spectral Solutions, Inc. and
Illinois Superconductor Canada Corporation entered into an amendment to the
November 10, 2004 Third Amended and Restated Loan Agreement, as amended, with
corresponding amendments to the Fourth Amended and Restated Guaranties and the
Fourth Amended and Restated Security Agreement and notes issued by the Company
in favor of the Lenders (the “Notes” and together with the Third Amended and
Restated Loan Agreement, the Fourth Amended and Restated Guaranties and the
Fourth Amended and Restated Security Agreement, the “Loan Documents”) in
conjunction with the restructuring of the Notes (the
“Restructuring”).  The transaction was conducted pursuant to Section
3(a)(9) of the Securities Act, as amended (the “Securities Act”).
 
 The
Company issued amended and restated Notes (the “Amended and Restated Notes”) in
an aggregate principal amount, including accrued interest on the Notes, of
approximately $10.2 Million to replace all of the existing Notes under the
Company’s line of credit arrangement and reflect the amendments to the Loan
Documents, including: (i) the extension of the termination dates and maturity
dates for all the Notes from August 1, 2007 to August 1, 2009; (ii) the
reduction of the interest rate on each of the Notes from 9% to 7% per annum;
(iii) provision for the conversion of the aggregate principal amount outstanding
on each of the Amended and Restated Notes at the election of the Lenders,
together with all accrued and unpaid interest thereon into shares (the
“Conversion Shares”) of the Company’s Common Stock at an initial conversion
price of $0.20 per share.  In addition, pursuant to the amendments to
the Loan Documents, each of Manchester and Alexander has immediately converted
$750,000 in principal amount and accrued interest outstanding under the Notes
each lender held prior to the Restructuring, into shares (the “Initial
Conversion Shares”) of Common Stock at a conversion price of $0.18, the 10 day
volume weighted average closing price of the Company’s Common Stock on the AMEX
as of June 21, 2007.
 
 14
 Table of Contents
 Before
the Lenders could exercise their respective rights to convert the Amended and
Restated Notes into the Conversion Shares, the Company was required to seek the
approval of its stockholders to (i) increase the number of authorized shares of
Common Stock available for issuance under its Certificate of Incorporation, as
amended and (ii) approve the issuance of the Conversion Shares pursuant to Rule
713 of the AMEX Company Guide as well as to obtain the approval of AMEX to list
the Initial Conversion Shares and the Conversion Shares on AMEX.  The
Company was required to obtain these approvals within one year of the issuance
date of the Amended and Restated Notes.  Pursuant to the Registration
Rights Agreement, as described below, if the Initial Conversion Shares and
Conversion Shares were not registered for resale under the Securities Act by the
15 month anniversary of the issuance date of the Amended and Restated Notes,
then the then current interest rate would increase by a rate of 1% per annum
each month thereafter until the Initial Conversion Shares and Conversion Shares
are registered, up to the default rate of the lower of 20% per annum or the
highest amount permitted by law.
 
 The
conversion rate of the Amended and Restated Notes is subject to customary anti
dilution protections.  The Amended and Restated Notes do not contain
market or trading based ratchet or reset provisions.  The Company has
the right to redeem the Amended and Restated Notes in full in cash at any time
beginning June 26, 2009.
 The
Amended and Restated Notes are secured on a first priority basis by all of the
Company’s intangible and tangible property and assets.  Payment of the
Amended and Restated Notes is guaranteed by the Company’s Clarity
subsidiary.
 
 Pursuant
to a registration rights agreement with Manchester and Alexander, the Company
filed a registration statement on Form S-3 with the SEC, which was declared
effective February 14, 2008, covering the resale of the Conversion Shares and
the Initial Conversion Shares.
 
 Assuming
the Amended and Restated Notes are not converted until maturity, approximately
58.5 million shares of Common Stock would be required to be issued upon
conversion, for both principal and interest.  This amount was
approximately 27.9% of the approximately 201 million shares of Common Stock
currently issued and outstanding as of November 30, 2007.  As of
November 30, 2007, the Lenders, including their affiliates, beneficially owned
in the aggregate approximately 106 million shares, or 48%, of the Company’s
outstanding shares, including the Initial Conversion Shares.  As a
result of the Restructuring, the combined holdings of the Lenders would be
approximately 60% of the outstanding Common Stock as of November 30, 2007 on a
fully converted basis (excluding the Shares issuable in conjunction with the
Merger).  Except for the equity conversion for accrued interest as
described above, no amounts of principal or interest were paid by the Company
during 2007.
 
 
 Merger
Financing
 
 As a
condition to the Merger, ISCO was required to obtain financing in an amount
equal to $1,500,000 to fund (the “Financing”) the initial operations of the
combined entity after the Merger and transaction expenses of the Company
incurred in connection with the Merger and (ii) to pay off the amount
outstanding under Clarity’s line of credit agreement (as described
below).  Pursuant to the Financing, on January 3, 2008, the Company
issued a new Amended and Restated Note (the “Note”) to Alexander Finance, L.P.
(“Alexander”) in aggregate principal amount of $1.5 Million.  The Note
will mature August 1, 2009, bear interest of 7% per annum and be convertible,
together with all accrued and unpaid interest thereon, into shares (the
“Additional Conversion Shares”) of the Company’s common stock at an initial
conversion price of $0.20 per share.  The note contains substantially
similar terms and conditions as the Amended and Restated Notes previously issued
to the Lenders.
 
 In
connection with the Financing, the Company, the Lenders, Spectral Solutions,
Inc. and Illinois Superconductor Canada Corporation entered into an Amendment to
and Waiver and Consent Under the Loan Documents (the “Loan Amendment”), pursuant
to which the Lenders waived, among other things, (i) the requirement under the
Company’s existing line of credit arrangement (the “Loan Agreement”) to use such
cash proceeds received in connection with the Merger, the issuance of the
Shares, the issuance of the Note, and the transactions contemplated thereby to
prepay the outstanding Amended and Restated Notes issued to the Lenders, and
(ii) the prohibition of the Company pursuant to the Loan Agreement to directly
or indirectly create, assume, guarantee, or otherwise become or remain directly
or indirectly liable with respect to any indebtedness other than the exceptions
described therein, upon paying the amount outstanding under Clarity’s line of
credit at the closing of the Merger.
 
 Before
Alexander may exercise its right to convert the Note into the Additional
Conversion Shares, the Company is required to be able to issue the Conversion
Shares pursuant to AMEX rules as well as to obtain the approval of AMEX to list
the Additional Conversion Shares on AMEX.  ISCO is required to obtain
these approvals within one year of the issuance date of the Note.  In
the event that these required approvals are not obtained by that time, then the
interest rate on the Note will increase to a rate of 15% per
annum.  If the Additional Conversion Shares are not registered under
the Registration Rights Agreement, as described below, by the 15 month
anniversary of the issuance date of the Note, then the then-current interest
rate will increase by a rate of 1% per annum each month thereafter until the
Additional Conversion Shares are registered, up to the default rate of the lower
of 20% per annum or the highest amount permitted by law.  We intend to
seek the approval of our stockholders for the issuance of these Additional
Conversion Shares during the Company’s 2008 Annual Shareholder
Meeting.
 
 15
 Table of Contents
 The
conversion rate of the Note is subject to customary anti-dilution protections.
The Note does not contain market or trading-based ratchet or reset provisions.
The Company has the right to redeem the Note in full in cash at any time
beginning June 26, 2009.   The Note is secured on a first
priority basis by all of the Company’s intangible and tangible property and
assets, including the assets acquired from Clarity in the
Merger.  Payment of the Note  is guaranteed by the Company’s
Clarity subsidiary.
 
 In
connection with Financing, the Company entered into a Registration Rights
Agreement with Alexander.  Pursuant to the Registration Rights
Agreement, we are required to file a registration statement under the Securities
Act covering the resale of the shares of the Additional Conversion Shares with
the SEC within 30 days after both of the stockholders’ and AMEX approvals have
occurred.  The Registration Rights Agreement contains customary
covenants, including registration delay payments, in addition to certain
interest rate increases under the Note, under certain events for failing to
maintain the effectiveness of a registration statement covering the resale of
the Conversion Shares.  Assuming the Additional Conversion Shares are
approved as described above and the Note held to maturity, approximately 8.4
million shares of common stock would be required to be issued upon conversion,
for both principal and interest.
 
 
 Related
Party Transaction Approval Process
 
 Statement of
Principles
 
 The Board
is required to pre-approve any transactions with related parties, as those terms
are defined by the AMEX, the Public Company Accounting Oversight Board, the SEC
(e.g., Item 404 of Regulation S-K), or any other qualified entity.
 
 When in
doubt, all members of the organization are required to disclose the information
and the Board will determine the appropriate course of action, if any. In making
this determination the Board has the authority to engage the Company’s counsel
or other legal counsel as it deems appropriate and necessary.
 
 Company
Management is prohibited from engaging in any related party transaction without
the express approval of the Board.
 
 
 Procedures
 
 Requests
or applications to enter into related party transactions must be submitted to
the Chairman of the Board, who will then process the request using reasonable
judgment, including but not limited to submission for review to the full Board.
The Chairman will enter any such communications into the minutes of the next
Board meeting and include a current status and/or resolution. In addition, NEOs
and directors fill out annual disclosure questionnaires, in which they must
specify any related party dealings with respect to the Company and confirm in
writing that no other events have occurred. In addition, the Audit Committee
must review and approve any such transaction, as is noted in its charter
(attached as Appendix A to the Company’s Proxy Statement filed with the SEC on
April 27, 2007).
 
 Special Committee
established during 2007
 
 In
connection with the Merger, the Board established a special committee of
disinterested directors (the “Special Committee”) to evaluate, review and
negotiate the terms of what became the Merger and to recommend to the full Board
whether to approve the Merger and the transactions contemplated
thereby.  The Special Committee consisted of directors of ISCO who the
Board determined were independent in this matter and did not have a personal
interest in the Merger, outside that of which is created solely as a result of
their service on ISCO’s Board of Directors.  The Special Committee
consisted of Mr. John Thode, who was ISCO’s chief executive officer at the time
the Special Committee was established, Mr. Ralph Pini, the Chairman of ISCO’s
Board of Directors, and Dr. George Calhoun.  Mr. Fuentes was not at
any time a member of the Special Committee and did not participate in the
activities of the Special Committee, except to the extent of any negotiations
with the Special Committee as the sole stockholder and director of
Clarity.
 
 
 Independent
Directors
 
 The Board
has determined that Dr. Calhoun and Messrs. Folkebrant and Owings are each
“independent” pursuant to Section 121A of the AMEX rules.  Mr. Pini is
also independent, and though his recent service as interim CEO makes him unable
to serve on the Audit Committee, he is properly able to serve as an independent
director and member of the Compensation and Governance committees.
 
 
 16
 Table of Contents
  Item 14.
Principal Accounting Fees and Services
  Grant
Thornton LLP has served as the Company’s independent registered public
accountants since December 2000. Grant Thornton LLP has been selected to
continue as the Company’s independent registered public accountants for the
current year.
  During
the fiscal years ended December 31, 2007 and 2006, fees in connection with
services rendered by Grant Thornton LLP, the Company’s independent registered
accounting firm, were as set forth below:
  Fee
      Category
              
              Fiscal 2007
              
              Fiscal 2006Audit
      Fees
              
              $
              220,787
              
              $
              189,396Audit-Related
      Fees
              
              
              81,937
              
              
              7,040Tax
      Fees
              
              
              37,875
              
              
              39,422All
      Other Fees
              
              
              -
              
              
              -TOTAL
              
              $
              340,599
              
              $
              235,858
 
  Audit
fees consisted of fees for the audit of the Company’s annual financial
statements and review of quarterly financial statements as well as services
normally provided in connection with statutory and regulatory filings or
engagements, consents and assistance with and review of the Company’s documents
filed with the SEC.
 
 Audit-related
fees during 2007 consisted primarily of costs associated with auditing Clarity’s
books in connection with the acquisition of Clarity.
  Tax fees
consisted primarily of fees for tax compliance, tax advice and tax planning
services.
  The
Company made no other payments to Grant Thornton LLP during 2007 which
constituted other fees.
   
 Policy
for Pre-Approval of Audit and Non-Audit Services
  The Audit
Committee’s policy is to pre-approve all audit services and all non-audit
services that the Company’s independent auditor is permitted to perform for us
under applicable federal securities regulations. As permitted by the applicable
regulations, the Committee’s policy utilizes a combination of specific
pre-approval on a case-by-case basis of individual engagements of the
independent auditor and pre-approval of certain engagements up to predetermined
dollar thresholds that are reviewed annually by the Committee. Specific
pre-approval is mandatory for the annual financial statement audit engagement,
among others.
  All
engagements of the independent auditor to perform any audit services and
non-audit services have been pre-approved by the Committee in accordance with
the pre-approval policy. The policy has not been waived in any
instance.
  The Audit
Committee may delegate pre-approval authority to the Chairman of the Audit
Committee. The Chairman of the Audit Committee must report any decisions to the
Audit Committee at the next scheduled meeting.
   17
 Table of Contents
   SIGNATURES
  Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act
of 1934, the Registrant has duly caused this Amendment to be signed on its
behalf by the undersigned, thereunto duly authorized, on the 29th day of April,
2008.
  ISCO
      INTERNATIONALBy:
              
              /s/
      GORDON REICHARD, JR.Gordon
      Reichard, Jr.Chief
      Executive Officer
  Pursuant
to the requirements of the Securities Exchange Act of 1934, this Amendment has
been signed below by the following persons on behalf of the registrant and in
the capacities indicated on the 29th day of April, 2008.


Signature
              
              Title/s/
      GORDON REICHARD, JR.
              
              Chief
      Executive Officer and Director
                (Principal
      Executive Officer)Gordon
      Reichard, Jr./s/
      FRANK CESARIO
              
              Chief
      Financial Officer
                (Principal
      Financial and Accounting Officer)Frank
      Cesario/s/
      JAMES FUENTES
              
              Director
      and Chief Strategic OfficerJames
      Fuentes/s/
      AMR ABDELMONEM
              
              Director,
      Chief Operating Officer and Chief Technology OfficerAmr
      Abdelmonem
 /s/
      RALPH PINI
              
              Chairman
      of the Board of DirectorsRalph
      Pini/s/
      GEORGE CALHOUN
              
              DirectorGeorge
      Calhoun/s/
      JOHN THODE
              
              DirectorJohn
      Thode/s/
      JOHN OWINGS
              
              DirectorJohn
      Owings/s/
      TORBJORN FOLKEBRANT
              
              DirectorTorbjorn
      Fokebrant












ISCO
INTERNATIONAL


EXHIBIT INDEX





Exhibit
              Number
            
            Description
      of Exhibits2.1
            
            Agreement
      and Plan of Merger by and between the Company, ISCO Illinois, Inc. (“ISCO
      Illinois”), Clarity Communication Systems Inc. (“Clarity”) and James
      Fuentes, dated November 13, 2007, incorporated by reference to Exhibit 2.1
      to the Company’s Current Report on Form 8-K filed on November 20,
      2007.3.1
            
            Certificate
      of Incorporation of the Company, incorporated by reference to Exhibit 3.1
      to the Company’s Registration Statement on Form S-3/A, filed with the
      Securities and Exchange Commission (“SEC”) on August 13, 1998,
      Registration No. 333-56601 (the “August 1998 S-3”).3.2
            
            By-Laws
      of the Company, incorporated by reference to Exhibit 3.2 to Amendment No.
      3 to the Company’s Registration Statement on Form S-1, filed with the SEC
      on October 26, 1993, Registration No. 33-67756 (the “IPO Registration
      Statement”).3.3
            
            Certificate
      of Amendment of Certificate of Incorporation of the Company, incorporated
      by reference to Exhibit 3.3 to the IPO Registration
    Statement.3.4
            
            Certificate
      of Amendment of Certificate of Incorporation of the Company, incorporated
      by reference to Exhibit 4.3 to the Company’s Registration Statement on
      Form S-3/A, filed with the SEC on July 1, 1999, Registration No.
      333-77337.3.5
            
            Certificate
      of Amendment of Certificate of Incorporation of the Company filed July 18,
      2000, incorporated by reference to the Company’s registration statement on
      Form S-8 filed August 7, 2000 (the August 2000 S-8”).3.6
            
            Certificate
      of Amendment to Certificate of Incorporation filed with the Secretary of
      State of the State of Delaware on June 25, 2001, incorporated by reference
      to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on June
      27, 2001.3.7
            
            Certificate
      of Amendment to Certificate of Incorporation filed with the Secretary of
      State of the State of Delaware on December 16, 2004, incorporated by
      reference to Exhibit 3.7 to the Company’s Annual Report on Form 10-K filed
      on March 31, 2005 (the “2004 10-K”).4.1
            
            Specimen
      stock certificate representing common stock, incorporated by reference to
      Exhibit 4.1 to the IPO Registration Statement.4.2
            
            Rights
      Agreement dated as of February 9, 1996 between the Company and LaSalle
      National Trust, N.A., incorporated by reference to the Exhibit to the
      Company’s Registration Statement on Form 8-A, filed with the SEC on
      February 12, 1996.4.3
            
            The
      SSI Replacement Nonqualified Stock Option Plan, incorporated by reference
      to Exhibit 4.1 to the Company’s Registration Statement on Form S-8, filed
      with the SEC on November 3, 2000, Registration No.
    333-49268.*4.4
            
            Amendment
      No. 1 to the Rights Agreement between ISCO International, Inc. (formerly
      Illinois Superconductor Corporation) and LaSalle National Trust
      Association (formerly known as LaSalle National Trust Company) dated as of
      February 9, 1996, incorporated by reference to Exhibit 4.1 to the
      Company’s Current Report on Form 8-K filed with the SEC on February 22,
      2002.10.1 *
            
            Form
      of Amended and Restated Director Indemnification Agreement, incorporated
      by reference to Exhibit 10 to the Company’s Quarterly Report on Form 10-Q
      for the quarterly period ended September 30, 1998.10.2
            
            Public
      Law Agreement dated February 2, 1990 between Illinois Department of
      Commerce and Community Affairs and the Company, incorporated by reference
      to Exhibit 10.5 to the IPO Registration Statement.10.3
            
            Public
      Law Agreement dated December 30, 1991 between Illinois Department of
      Commerce and Community Affairs and the Company, amended as of June 30,
      1992, incorporated by reference to Exhibit 10.6 to the IPO Registration
      Statement.10.4
            
            Subcontract
      and Cooperative Development Agreement dated as of June 1, 1993 between
      American Telephone and Telegraph Company and the Company, incorporated by
      reference to Exhibit 10.9 to the IPO Registration
    Statement.10.5
            
            Intellectual
      Property Agreement dated as of June 1, 1993 between American Telephone and
      Telegraph Company and the Company, incorporated by reference to Exhibit
      10.10 to the IPO Registration Statement.10.6
            
            License
      Agreement dated January 31, 1990 between the Company and Northwestern
      University, incorporated by reference to Exhibit 10.13 to the IPO
      Registration Statement.10.7
            
            License
      Agreement dated February 2, 1990 between the Company and ARCH Development
      Corporation, incorporated by reference to Exhibit 10.14 to the IPO
      Registration Statement.10.8
            
            License
      Agreement dated August 9, 1991 between the Company and ARCH Development
      Corporation, incorporated by reference to Exhibit 10.15 to the IPO
      Registration Statement.10.9
            
            License
      Agreement dated October 11, 1991 between the Company and ARCH Development
      Corporation, incorporated by reference to Exhibit 10.16 to the IPO
      Registration Statement.10.10
            
            Public
      Law Agreement dated August 18, 1993 between Illinois Department of
      Commerce and Community Affairs and the Company, incorporated by reference
      to Exhibit 10.17 to the IPO Registration
  Statement.





10.11 *
            
            Form
      of Officer Indemnification Agreement incorporated by reference to Exhibit
      10.17 to the Company’s Annual Report on Form 10-K for the year ended
      December 31, 1998.10.12
            
            Escrow
      Agreement dated August 8, 2000 among the Company, Russell Scott, III, as
      stockholder representative, and American National Bank and Trust Company,
      as escrow agent, incorporated by reference to Exhibit 10.25 to the
      Company’s registration statement on Form S-2 filed September 7, 2000,
      Registration No. 333-45406 (the “September S-2”).10.13
            
            ISCO
      International, Inc. Amended and Restated 1993 Stock Option Plan,
      incorporated by reference to Appendix C and D of the Company’s Definitive
      Proxy materials filed on May 22, 2001.10.14
            
            Secured
      9 1/2 % Grid Note dated October 23, 2002 between ISCO International, Inc.
      and Alexander Finance L.P. in the principal amount of $1,752,400,
      incorporated by reference to Exhibit 10.3 to the Company’s Current Report
      on Form 8-K filed on October 24, 2002.10.15
            
            Secured
      9 1/2 % Grid Note dated October 23, 2002 between ISCO International,
      Inc. and Manchester Securities Corporation in the principal amount of
      $2,247,600, incorporated by reference to Exhibit 10.4 to the Company’s
      Current Report on Form 8-K filed on October 24, 2002.10.16
            
            Registration
      Rights Agreement dated October 23, 2002 between ISCO International, Inc.
      Manchester Securities Corporation, and Alexander Finance L.P.,
      incorporated by reference to Exhibit 10.7 to the Company’s Current Report
      on Form 8-K filed on October 24, 2002.10.17
            
            ISCO
      International, Inc. 2003 Equity Incentive Plan, as amended incorporated by
      reference to Exhibit D of the Company’s Definitive Proxy materials filed
      on December 11, 2007.10.18
            
            Secured
      14% Grid Note dated October 24, 2003 between ISCO International, Inc. and
      Alexander Finance, L.P. in the principal amount of $876,200, incorporated
      by reference to Exhibit 10.10 to the Company’s Current Report on Form 8-K
      filed on October 27, 2003.10.19
            
            Secured
      14% Grid Note dated October 24, 2003 between ISCO International, Inc. and
      Manchester Securities Corporation in the principal amount of $1,123,800,
      incorporated by reference to Exhibit 10.11 to the Company’s Current Report
      on Form 8-K filed on October 27, 2003.10.20
            
            Secured
      14% Grid Note dated July 23, 2004 between ISCO International, Inc. and
      Alexander Finance, L.P. in the principal amount of $386,900, incorporated
      by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K
      filed on July 28, 2004.10.21
            
            Secured
      14% Grid Note dated July 23, 2004 between ISCO International, Inc. and
      Manchester Securities Corporation in the principal amount of $113,100,
      incorporated by reference to Exhibit 10.4 to the Company’s Current Report
      on Form 8-K filed on July 28, 2004.10.22
            
            Stock
      Purchase Agreement dated December 15, 2003 between ISCO International,
      Inc. and Morgan & Finnegan, L.L.P., incorporated by reference to
      Exhibit 10.1 to the Company’s Current Report of Form 8-K filed on December
      16, 2003.10.23
            
            Office/Service
      Center Lease Agreement dated July 20, 2004 between ISCO International,
      Inc. and D&K Elk Grove Industrial II, LLC, incorporated by reference
      to Exhibit 10.24 to the 2004 10-K.10.24
            
            Third
      Amended and Restated Loan Agreement dated November 10, 2004 between ISCO
      International, Inc., Manchester Securities Corporation, and Alexander
      Finance L.P., incorporated by reference to Exhibit 10.1 to the Company’s
      Current Report on Form 8-K filed on November 12, 2004.10.25
            
            Secured
      14% Grid Note dated November 10, 2004 between ISCO International, Inc. and
      Alexander Finance, L.P. in the principal amount of $1,100,000,
      incorporated by reference to Exhibit 10.3 to the Company’s Current Report
      on Form 8-K filed on November 12, 2004.10.26
            
            Secured
      14% Grid Note dated November 10, 2004 between ISCO International, Inc. and
      Manchester Securities Corporation in the principal amount of $900,000,
      incorporated by reference to Exhibit 10.4 to the Company’s Current Report
      on Form 8-K filed on November 12, 2004.10.27
            
            Amendment
      to Loan Documents dated February 10, 2005 between ISCO International,
      Inc., Manchester Securities Corporation, Alexander Finance, L.P., Spectral
      Solutions, Inc. and Illinois Superconductor Corporation, incorporated by
      reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K
      filed on February 15, 2005.10.28
            
            Securities
      Purchase Agreement dated July 25, 2005 by and among ISCO International,
      Inc. Alexander Finance, L.P., Grace Brothers LTD, Elliott Associates,
      L.P., and Elliott International, L.P., incorporated by reference to
      Exhibit 10.1 to the Company’s Current Report of Form 8-K filed on July 26,
      200510.29
            
            Amendment
      to and Waiver Under Loan Documents dated July 25, 2005 by and among ISCO
      International, Inc., Manchester Securities Corporation and Alexander
      Finance, L.P., incorporated by reference to Exhibit 10.2 to the Company’s
      Current Report of Form 8-K filed on July 26, 200510.30
            
            Letter
      Agreement dated August 5, 2005 by and among ISCO International, Inc.,
      Elliott Associates, L.P., and Elliott International, L.P., incorporated by
      reference to Exhibit 10.1 to the Company’s Current Report of Form 8-K
      filed on August 9, 2005.10.31*
            
            Thode
      Employment Agreement dated January 10, 2006 between ISCO International,
      Inc. and John S. Thode, incorporated by reference to Exhibit 10.1 to the
      Company’s Current Report of Form 8-K filed on January 17,
      2006.10.32*
            
            Abdelmonem
      Employment Agreement dated January 12, 2006 between ISCO International,
      Inc. and Dr. Amr Abdelmonem, incorporated by reference to Exhibit 10.2 to
      the Company’s Current Report of Form 8-K filed on January 17,
      2006.10.33*
            
            Restricted
      Stock Agreement dated January 12, 2006 by and between ISCO International,
      Inc. and Dr. Amr Abdelmonem, incorporated by reference to Exhibit 10.3 to
      the Company’s Current Report of Form 8-K filed on January 17,
      2006.10.34*
            
            Employment
      Agreement dated February 6, 2006 between ISCO International, Inc. and
      Frank J. Cesario, incorporated by reference to Exhibit 10.1 to the
      Company’s Current Report of Form 8-K filed on February 9,
      2006.10.35*
            
            Summary
      of Non-Employee Director Compensation Policy, incorporated by reference to
      Exhibit 10.1 to the Company’s Current Report of Form 8-K filed on February
      24, 2006.10.36
            
            Securities
      Purchase Agreement by and among ISCO International, Inc., Manchester
      Securities Corporation and Alexander Finance, L.P. dated June 22, 2006,
      incorporated by reference to Exhibit 10.1 to the Company’s Current Report
      on Form 8-K filed on June 28, 2006.10.37
            
            5%
      Senior Secured Convertible Note by and between ISCO International, Inc.
      and Manchester Securities Corporation, incorporated by reference to
      Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on June 28,
      2006.10.38
            
            5%
      Senior Secured Convertible Note by and between ISCO International, Inc.
      and Alexander Finance, L.P., incorporated by reference to Exhibit 10.3 to
      the Company’s Current Report on Form 8-K filed on June 28,
      2006.10.39
            
            Registration
      Rights Agreement by and among ISCO International, Inc., Manchester
      Securities Corporation and Alexander Finance, L.P. dated June 22, 2006,
      incorporated by reference to Exhibit 10.4 to the Company’s Current Report
      on Form 8-K filed on June 28, 2006.10.40
            
            Fourth
      Amended and Restated Security Agreement by and among ISCO International,
      Inc., Spectral Solutions, Inc., Illinois Superconductor Canada
      Corporation, Manchester Securities Corporation and Alexander Finance, L.P.
      dated June 22, 2006, incorporated by reference to Exhibit 10.5 to the
      Company’s Current Report on Form 8-K filed on June 28,
    2006.10.41
            
            Fourth
      Amended and Restated Guaranty of Spectral Solutions, Inc., incorporated by
      reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K
      filed on June 28, 2006.10.42
            
            Fourth
      Amended and Restated Guaranty of Illinois Superconductor Canada
      Corporation, incorporated by reference to Exhibit 10.7 to the Company’s
      Current Report on Form 8-K filed on June 28, 2006.10.43
            
            Amendment
      to and Waiver Under the Third Amended and Restated Loan Agreement by and
      among ISCO International, Inc., Spectral Solutions, Inc., Illinois
      Superconductor Canada Corporation, Manchester Securities Corporation and
      Alexander Finance, L.P. dated June 22, 2006, incorporated by reference to
      Exhibit 10.8 to the Company’s Current Report on Form 8-K filed on June 28,
      2006.10.44
            
            Amendment
      to Loan Documents dated June 26, 2007 between the Company, Manchester
      Securities Corporation, Alexander Finance, L.P., ISCO International, Inc.,
      Spectral Solutions, Inc. and Illinois Superconductor Corporation,
      incorporated by reference to Exhibit 10.1 to the Company’s Quarterly
      Report on Form 10-Q filed on November 14, 2007.10.45
            
            Amended
      and Restated 7% Senior Secured Convertible Note by and between ISCO
      International, Inc. and Manchester Securities Corporation, dated June 26,
      2007, in the amount of $2,520,441.39, incorporated by reference to Exhibit
      10.2 to the Company’s Quarterly Report on Form 10-Q filed on November 14,
      2007.10.46
            
            Amended
      and Restated 7% Senior Secured Convertible Note by and between ISCO
      International, Inc. and Manchester Securities Corporation, dated June 26,
      2007, in the amount of $1,522,687.06, incorporated by reference to Exhibit
      10.3 to the Company’s Quarterly Report on Form 10-Q filed on November 14,
      2007.10.47
            
            Amended
      and Restated 7% Senior Secured Convertible Note by and between ISCO
      International, Inc. and Manchester Securities Corporation, dated June 26,
      2007, in the amount of $147,240.00, incorporated by reference to Exhibit
      10.4 to the Company’s Quarterly Report on Form 10-Q filed on November 14,
      2007.10.48
            
            Amended
      and Restated 7% Senior Secured Convertible Note by and between ISCO
      International, Inc. and Manchester Securities Corporation, dated June 26,
      2007, in the amount of $1,121,625.00, incorporated by reference to Exhibit
      10.5 to the Company’s Quarterly Report on Form 10-Q filed on November 14,
      2007.10.49
            
            Amended
      and Restated 7% Senior Secured Convertible Note by and between ISCO
      International, Inc. and Alexander Finance, LLC, dated June 26, 2007, in
      the amount of $1,622,405.00, incorporated by reference to Exhibit 10.6 to
      the Company’s Quarterly Report on Form 10-Q filed on November 14,
      2007.10.50
            
            Amended
      and Restated 7% Senior Secured Convertible Note by and between ISCO
      International, Inc. and Alexander Finance, LLC, dated June 26, 2007, in
      the amount of $1,314,300.00, incorporated by reference to Exhibit 10.7 to
      the Company’s Quarterly Report on Form 10-Q filed on November 14,
      2007.10.51
            
            Amended
      and Restated 7% Senior Secured Convertible Note by and between ISCO
      International, Inc. and Alexander Finance, LLC, dated June 26, 2007, in
      the amount of $1,375,000.00, incorporated by reference to Exhibit 10.8 to
      the Company’s Quarterly Report on Form 10-Q filed on November 14,
      2007.10.52
            
            Amended
      and Restated 7% Senior Secured Convertible Note by and between ISCO
      International, Inc. and Alexander Finance, LLC, dated June 26, 2007, in
      the amount of $550,000.00, incorporated by reference to Exhibit 10.9 to
      the Company’s Quarterly Report on Form 10-Q filed on November 14,
      2007.10.53
            
            Registration
      Rights Agreement dated June 26, 2007, by and among ISCO International,
      Inc., Manchester Securities Corp. and Alexander Finance, L.P. ,
      incorporated by reference to Exhibit 10.10 to the Company’s Quarterly
      Report on Form 10-Q filed on November 14, 2007.10.54*
            
            Employment
      Agreement with Jim Fuentes, incorporated by reference to Exhibit B to the
      Agreement and Plan of Merger by and among ISCO International, Inc., ISCO
      Illinois, Inc., Clarity Communication Systems Inc. and James Fuentes (for
      himself and as Representative of the Clarity Rightsholders) filed as
      Exhibit 2.1 to ISCO International, Inc.’s Current Report on Form 8-K filed
      on November 20, 2007.10.55
            
            Registration
      Rights Agreement with Jim Fuentes and Certain Clarity Rightsholders,
      incorporated by reference to Exhibit C to the Agreement and Plan of Merger
      by and among ISCO International, Inc., ISCO Illinois, Inc., Clarity
      Communication Systems Inc. and James Fuentes (for himself and as
      Representative of the Clarity Rightsholders) filed as Exhibit 2.1 to ISCO
      International, Inc.’s Current Report on Form 8-K filed on November 20,
      2007.10.56
            
            Amendment
      to and Consent and Waiver Under the Loan Documents by and among ISCO
      International, Inc., Spectral Solutions, Inc., Illinois Superconductor
      Canada Corporation, Manchester Securities Corporation and Alexander
      Finance, L.P. dated January 3, 2008, filed as exhibit 10.3 to ISCO
      International, Inc.’s Current Report on Form 8-K filed on January 9,
      2008.10.57
            
            New
      Amended and Restated 7% Senior Secured Convertible Note by and between
      ISCO International, Inc. and Alexander Finance, LLC, dated January 3,
      2008, in the amount of $1,500,000.00, filed as exhibit 10.4 to ISCO
      International, Inc.’s Current Report on Form 8-K filed on January 9,
      2008.10.58
            
            Registration
      Rights Agreement by and between ISCO International, Inc. and Alexander
      Finance, L.P. dated January 3, 2008, filed as exhibit 10.5 to ISCO
      International, Inc.’s Current Report on Form 8-K filed on January 9,
      2008.10.59
            
            Amendment
      and Termination and Release of Guaranty by and between the Company,
      Manchester Securities Corporation, Alexander Finance, L.P., Illinois
      Superconductor Canada Corporation and Spectral Solutions, Inc., dated
      January 31, 2008, filed as exhibit 10.1 to ISCO International, Inc.’s
      Current Report on Form 8-K filed on January 31, 2008.10.60
            
            Fifth
      Amended and Restated Security Agreement by and between the Company,
      Clarity Communication Systems, Inc., Manchester Securities Corporation and
      Alexander Finance, L.P., dated January 31, 2008, filed as exhibit 10.2 to
      ISCO International, Inc.’s Current Report on Form 8-K filed on January 31,
      2008.10.61
            
            Guaranty
      of Clarity Communication Systems, Inc., by and between the Company,
      Clarity Communication Systems, Inc., Manchester Securities Corporation and
      Alexander Finance, L.P., dated January 31, 2008, filed as exhibit 10.3 to
      ISCO International, Inc.’s Current Report on Form 8-K filed on January 31,
      2008.10.62*
            
            Employment
      Agreement by and between the Company and Amr Abdelmonem, dated February
      19, 2008, filed as exhibit 10.1 to ISCO International, Inc.’s Current
      Report on Form 8-K filed on February 22, 2008.10.63*
            
            Restricted
      Stock Agreement by and between the Company and Amr Abdelmonem, dated
      February 19, 2008, filed as exhibit 10.2 to ISCO International, Inc.’s
      Current Report on Form 8-K filed on February 22, 2008.10.63
            
            Employment
      Agreement dated March 5, 2008 between ISCO International, Inc. and Mr.
      Gordon E. Reichard, Jr., filed as exhibit 10.1 to ISCO International,
      Inc.’s Current Report on Form 8-K filed on March 10,
  2008.10.64
            
            Restricted
      Stock Agreement dated March 10, 2008 by and between ISCO International,
      Inc. and Mr. Gordon E. Reichard, Jr., filed as exhibit 10.2 to ISCO
      International, Inc.’s Current Report on Form 8-K filed on March 10,
      2008.10.65
            
            Assignment
      Agreement between ISCO International, Inc., Grace Investments, Ltd., and
      Manchester Securities Corporation filed as exhibit 10.1 to ISCO
      International, Inc’s Current Report on Form 8-K filed on March 25,
      2008.14
            
            Code
      of Ethics incorporated by reference to Exhibit 14 to the Company’s Annual
      Report on Form 10-K filed on March 30, 2004.21
            
            List
      of subsidiaries: Clarity Communication Systems, Inc., an Illinois
      corporation.23.1
            
            Consent
      of Grant Thornton LLP31.1**
            
            Certification
      by Chief Executive Officer pursuant to Rule 13a-14(a) and 15d-14(a) as
      adopted pursuant to Section 302 of the Sarbanes Oxley Act of
      2002.31.2**
            
            Certification
      by Chief Financial Officer pursuant to Rule 13a-14(a) and 15d-14(a) as
      adopted pursuant to Section 302 of the Sarbanes Oxley Act of
      2002.32**
            
            Certification
      Pursuant To 18 U.S.C Section 1350, as Adopted Pursuant to Section 906 of
      the Sarbanes-Oxley Act of 2002*
            Management
      contract or compensatory plan or arrangement required to be filed as an
      exhibit on this Form 10-K.**
            Filed
      herewith.


















Exhibit 31.1




CERTIFICATIONS







I, Gordon
Reichard, Jr., certify that:




1. I have
reviewed this annual report on Form 10-K, as amended, of ISCO International,
Inc.;




2. Based
on my knowledge, this annual report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this annual
report;




3. Based
on my knowledge, the financial statements, and other financial information
included in this annual report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as
of, and for, the periods presented in this annual report;




4. The
registrant’s other certifying officer and I are responsible for establishing and
maintaining disclosure controls and procedures (as defined in Exchange Act Rules
13a-15(e) and 15(d)-15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules, 13(a)-15(f) and 15(d)-15(f)) for the registrant
and have:




a.
designed such disclosure controls and procedures or caused such disclosure
controls and procedures to be designed under our supervision to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this annual report is being prepared;





b.
designed such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles;




c.
evaluated the effectiveness of the registrant’s disclosure controls and
procedures and presented in this annual report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this annual report based on such evaluation;




d.
disclosed in this annual report any change in the registrant’s internal control
over financial reporting that occurred during the registrant’s most recent
fiscal quarter that was materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial reporting;
and




5. The
registrant’s other certifying officer and I have disclosed, based on our most
recent evaluation of internal control over financial reporting, to the
registrant’s auditors and the Audit Committee of the registrant’s board of
directors (or persons performing the equivalent functions):




a. all
significant deficiencies and material weaknesses in the design or operation of
internal control over financial reporting which are reasonably likely to
adversely affect the registrant’s ability to record, process, summarize and
report financial information; and




b. any
fraud, whether or not material, that involves management or other employees who
have a significant role in the registrant’s internal control over financial
reporting.






ISCO
      International, Inc.Date: April
      29, 2008
            By:
            /s/ 
      GORDON REICHARD,
      JR.Gordon
      Reichard, Jr.Chief
      Executive Officer







Exhibit 31.2




CERTIFICATIONS


I, Frank
Cesario, certify that:




1. I have
reviewed this annual report on Form 10-K, as amended, of ISCO International,
Inc.;




2. Based
on my knowledge, this annual report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this annual
report;




3. Based
on my knowledge, the financial statements, and other financial information
included in this annual report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as
of, and for, the periods presented in this annual report;




4. The
registrant’s other certifying officer and I are responsible for establishing and
maintaining disclosure controls and procedures (as defined in Exchange Act Rules
13a-15(e) and 15(d)-15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules, 13(a)-15(f) and 15(d)-15(f)) for the registrant
and have:




a.
designed such disclosure controls and procedures or caused such disclosure
controls and procedures to be designed under our supervision to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this annual report is being prepared;





b.
designed such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles;




c.
evaluated the effectiveness of the registrant’s disclosure controls and
procedures and presented in this annual report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this annual report based on such evaluation;




d.
disclosed in this annual report any change in the registrant’s internal control
over financial reporting that occurred during the registrant’s most recent
fiscal quarter that was materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial reporting;
and




5. The
registrant’s other certifying officer and I have disclosed, based on our most
recent evaluation of internal control over financial reporting, to the
registrant’s auditors and the Audit Committee of the registrant’s board of
directors (or persons performing the equivalent functions):




a. all
significant deficiencies and material weaknesses in the design or operation of
internal control over financial reporting which are reasonably likely to
adversely affect the registrant’s ability to record, process, summarize and
report financial information; and




b. any
fraud, whether or not material, that involves management or other employees who
have a significant role in the registrant’s internal control over financial
reporting.






ISCO
      International,  Inc.Date: April
      29, 2008
            By:
            /s/ 
      FRANK
      CESARIOFrank
      CesarioChief
      Financial Officer







Exhibit 32









CERTIFICATION
PURSUANT


TO
18 U.S.C SECTION 1350,


AS
ADOPTED PURSUANT TO


SECTION
906 OF THE SARBANES-OXLEY ACT OF 2002






In
connection with the Annual Report of ISCO International, Inc. (the “Company”) on
Form 10-K, as amended, for the fiscal year ending December 31, 2007 as
filed with the Securities and Exchange Commission on the date hereof (the
“Report”), each of the undersigned officers of the Company, certify pursuant to
18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:




1. The
Report fully complies with the requirements of Section 13(a) or 15(d) of
the Securities Act of 1934; and




2. The
information contained in the Report fairly presents, in all material respects,
the financial condition and results of operations of the Company.










/s/ 
      GORDON REICHARD,
      JR.
            
            
            /s/ 
      FRANK
      CESARIOGordon
      Reichard, Jr.
              Chief
      Executive Officer
              April
      29, 2008
            
            
            Frank
      Cesario
              Chief
      Financial Officer
              April
      29, 2008