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**PowerCerv      Corporation**

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| **Florida**                                                                     |   | **59-3350778**                                        |
|---------------------------------------------------------------------------------|--------|-------------------------------------------------------|
| (State                  or other jurisdiction of incorporation or organization) |   | (I.R.S.                  Employer Identification No.) |

**3000      Bayport Drive, Suite 910, Tampa, FL 33607**

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**(813)      979-9222**

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**Yes      **
**o      **

**No      x**

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**PowerCerv      Corporation**

**Form      10-QSB**

**Index**

| **Part                  I. Financial Information**                                                                     | **Page** |
|------------------------------------------------------------------------------------------------------------------------|----------|
|                                                                                                                   |     |
| Item                  1. Financial Statements                                                                          |     |
|                                                                                                                   |     |
| Condensed                  Consolidated Balance Sheets as of March 31, 2004                  (unaudited)               |     |
| and                  December 31, 2003 (audited)                                                                       | 2        |
|                                                                                                                   |     |
| Condensed                  Consolidated Statements of Operations for the Three Months                  Ended           |     |
| March                  31, 2004 and 2003 (unaudited)                                                                   | 3        |
|                                                                                                                   |     |
| Condensed                  Consolidated Statements of Cash Flows for the Three Months Ended                            |     |
| March                  31, 2004 and 2003 (unaudited)                                                                   | 4        |
|                                                                                                                   |     |
| Condensed                  Consolidated Statement of Stockholders’ Deficit for the three                  months |     |
| ended                  March 31, 2004 (unaudited)                                                                      | 5        |
|                                                                                                                   |     |
| Notes                  to Condensed Consolidated Financial Statements (unaudited)                                      | 6-8      |
|                                                                                                                   |     |
| Item                  2. Management's Discussion and Analysis or Plan of                  Operations                   | 9-11     |
|                                                                                                                   |     |
| Item                  3. Controls and Procedures                                                                       | 12       |
|                                                                                                                   |     |
| **Part                  II. Other Information**                                                                        |     |
|                                                                                                                   |     |
| Item                  1. Legal Proceedings                                                                             | 13       |
|                                                                                                                   |     |
| Item                  6. Exhibits and Reports on Form 8-K                                                              | 13       |
|                                                                                                                   |     |
| Signatures                                                                                                             | 14       |
|                                                                                                                   |     |
| Certifications                                                                                                         | 15-19    |
|                                                                                                                   |     |

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**Part      I. FINANCIAL INFORMATION**

**Item      1. Financial Statements**

**PowerCerv      Corporation and Subsidiary**

**Condensed      Consolidated Balance Sheets**

**Assets**

|                                                               |   | March                  31, 2004 |          | December                  31, |   |
|--------------------------------------------------------------------|--------|---------------------------------|---------------|-------------------------------|--------|
|                                                               |   |  (unaudited)               |          |  2003                    |   |
| Current                  assets:                                   |   |                            |          |                          |   |
| Cash                  and cash equivalents                         |   | $                               | —       |                          | $      | 33,086 |   |
| Marketable                  securities (restated)                  |   |                            | 132,862       |                          |   | 123,293 |   |
| Note                  receivable, related party                    |   |                            | —  |                          |   | 110,000 |   |
| Other                  current assets                              |   |                            | 8,000         |                          |   | 11,000 |   |
|                                                               |   |                            |          |                          |   |   |   |
| Total                  current assets                              |   |                            | 140,862       |                          | $      | 277,379 |   |
| Total                  assets                                      |   | $                               | 140,862       |                          | $      | 277,379 |   |
|                                                               |   |                            |          |                          |   |   |   |
| **Liabilities                  and Stockholders' Deficit**         |
|                                                               |   |                            |          |                          |   |   |   |
| Current                  liabilities:                              |   |                            |          |                          |   |   |   |
| Accounts                  payable                                  |   | $                               | 9,197         |                          | $      | 11,398 |   |
| Bank                  overdraft                                    |   |                            | 53,314        |                          |   | —  |   |
| Accrued                  expenses                                  |   |                            | 269,435       |                          |   | 344,563 |   |
| Due                  to related party                              |   |                            | 52,105        |                          |   | —  |   |
|                                                               |   |                            |          |                          |   |   |   |
| Total                  current liabilities                         |   |                            | 384,051       |                          |   | 355,961 |   |
|                                                               |   |                            |          |                          |   |   |   |
| Commitments                  and contingencies                     |   |                            | —  |                          |   | —  |   |
|                                                               |   |                            |          |                          |   |   |   |
| Stockholders’                  deficit (restated)            |   |                            | (243,189      | )                             |   | (78,582 | ) |
|                                                               |   |                            |          |                          |   |   |   |
| Total                  liabilities and stockholders’ deficit |   | $                               | 140,862       |                          | $      | 277,379 |   |

----

**PowerCerv            Corporation and Subsidiary**

**Condensed            Consolidated Statements of            Operations**

** (Unaudited)**

|                                                                           |   |  Three                      months ended March 31, |      |
|--------------------------------------------------------------------------------|--------|---------------------------------------------------------|-----------|
|                                                                           |   |  2004                          |      |  2003 |   |
| Revenues                                                                       |   | $                                                       | —   |   | $ | — |   |
|                                                                           |   |                                                    |      |   |   |   |   |
| Costs                      and expenses:                                       |   |                                                    |      |   |   |   |   |
| General                      and administrative                                |   |                                                    | 26,251    |   |   | 59,000 |   |
|                                                                           |   |                                                    |      |   |   |   |   |
| Operating                      loss                                            |   | (                                                       | 26,251    | ) | ( | 59,000 | ) |
|                                                                           |   |                                                    |      |   |   |   |   |
| Litigation                      settlement income                              |   |                                                    | 125,000   |   |   | — |   |
| Interest                      income, net                                      |   |                                                    | —   |   |   | 2,000 |   |
|                                                                           |   |                                                    |      |   |   |   |   |
| Income                      (loss) before income taxes                         |   |                                                    | 98,749    |   | ( | 57,000 | ) |
|                                                                           |   |                                                    |      |   |   |   |   |
| Income                      tax expense                                        |   |                                                    | —   |   |   | 3,000 |   |
|                                                                           |   |                                                    |      |   |   |   |   |
| Net                      income (loss)                                         |   |                                                    | 98,749    |   |   |   |   |
|                                                                           |   |                                                    |      |   |   |   |   |
| Preferred                      stock dividend                                  |   | (                                                       | 270,000   | ) |   |   |   |
|                                                                           |   |                                                    |      |   |   |   |   |
| Net                      loss attributable tocommon stockholders               |   | ($                                                      | 171,251   | ) | ( | 60,000 | ) |
|                                                                           |   |                                                    |      |   |   |   |   |
| Income                      (loss) per common share:                           |   |                                                    |      |   |   |   |   |
| Basic                      and diluted:                                        |   |                                                    |      |   |   |   |   |
| Net                      income (loss)                                         |   | $                                                       | 0.06      |   | ( | 0.05 | ) |
| Net                          loss attributable to common shareholders          |   | ($                                                      | 0.10      | ) | ( | 0.05 | ) |
|                                                                           |   |                                                    |      |   |   |   |   |
| Shares                          used in computing net income (loss) per share: |   |                                                    |      |   |   |   |   |
| Basic                      and Diluted                                         |   |                                                    | 1,652,713 |   |   | 1,313,000 |   |

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**PowerCerv              Corporation and Subsidiary**

**Condensed              Consolidated Statements of Cash Flows **

**(Unaudited)**

|                                                                                                                         |   |  Three                  months ended March 31 |
|------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------|
|                                                                                                                         |   |     2004                       |   |  2003 |   |
| Cash                  flows from operating activities:                                                                       |   |                                               |   |   |   |
| Net                  income (loss)                                                                                           |   | $                                                  | 98,749 |   |   | ($60,000 | ) |
| Adjustments                  to reconcile net income  (loss)                  to net cash used in operating activities: |   |                                               |   |   |   |   |   |
| Changes                  in assets and liabilities                                                                           |   |                                               | (22,224 | ) |   | (146,000 | ) |
|                                                                                                                         |   |                                               |   |   |   |   |   |
| Net                    cash flows provided by (used in)  operating                    activities                   |   |                                               | 76,525 |   |   | (206,000 | ) |
|                                                                                                                         |   |                                               |   |   |   |   |   |
| Cash                  flows from investing activities:                                                                       |   |                                               |   |   |   |   |   |
| Proceeds                  received on notes receivable                                                                       |   |                                               | 110,000 |   |   | 21,000 |   |
|                                                                                                                         |   |                                               |   |   |   |   |   |
| Net                  cash flows used in investing activities                                                                 |   |                                               | 110,000 |   |   | 21,000 |   |
|                                                                                                                         |   |                                               |   |   |   |   |   |
| Cash                  flows from financing activities:                                                                       |   |                                               |   |   |   |   |   |
| Payment                  of cash dividend to stockholders                                                                    |   |                                               | (272,925 | ) |   | — |   |
| Increase                  in bank overdraft                                                                                  |   |                                               | 53,314 |   |   | — |   |
|                                                                                                                         |   |                                               |   |   |   |   |   |
| Net                  cash flows provided by financing activities                                                             |   |                                               | (219,611 | ) |   | — |   |
|                                                                                                                         |   |                                               |   |   |   |   |   |
| Net                  decrease in cash and cash equivalents                                                                   |   |                                               | (33,086 | ) |   | (185,000 | ) |
|                                                                                                                         |   |                                               |   |   |   |   |   |
| Cash                      and cash equivalents, beginning                      of  period                          |   |                                               | 33,086 |   |   | 245,000 |   |
|                                                                                                                         |   |                                               |   |   |   |   |   |
| Cash                  and cash equivalents, end of period                                                                    |   | $                                                  | — |   | $ | 60,000 |   |

**SUPPLEMENTAL        DISCLOSURE OF NON-CASH INVESTING AND FINANCING        ACTIVITIES:**

| ·   | In                2004, the Company converted 997,222 shares of preferred stock to                997,222                shares of common stock. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | In                2004, $27,075 in stock subscriptions receivable were funded through                a                reduction in cash distributions to stockholders. These stock subscriptions                receivable have been levied by the IRS and, as such, the payments                further                reduced amounts due the IRS. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | In                2004, an aggregate of $52,105 in payments due the IRS were funded                by a                related party. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------|

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**PowerCerv              Corporation and Subsidiary**

**Consolidated              Statements of Stockholders’ Deficit**

**For              the three months ended March 31, 2004**

**(Unaudited)**

|                                                                                                           |   |                                 |      |                                          |   |        |   |       |      |           |   |                                 |   |                             |       |                    |   |                 |   |  Accumulated    |         |                       |   |
|----------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------|-----------|----------------------------------------------------|--------|------------------|--------|-----------------|-----------|---------------------|--------|-------------------------------------------|--------|---------------------------------------|------------|------------------------------|--------|---------------------------|--------|---------------------------|--------------|---------------------------------|--------|
|                                                                                                           |   |  Common                  Stock  |      |  Preferred                  Stock   |   |  Additional |   |            |      |           |   |  Stock                          |   |  Other                      |       |  Other             |   |  Total          |   |
|                                                                                                           |   |                                 |      |    Par                              |   |        |   |   Par |      |  Paid-In  |   |  Treasury                       |   |  Accumulated                |       |  Subscription      |   |  Comprehensive  |   |  Comprehensive  |         |  stockholders’  |   |
|                                                                                                           |   |  Shares                              |      |  Value                                        |   |  Shares     |   |  Value     |      |  Capital       |   |   Stock     |   |  Deficit     |       |  Receivable   |   |  Income         |   |  Income         |         |  Deficit                   |   |
| Balance,                  December 31, 2003 (as originally reported)                                           |   |                                      | 1,312,778 |                                               | $      | 1,313            |   |            | 1,022,222 |                | $      | 1,022                                     |   | $                                     | 51,704,944 |                         |   | ($25,931                  | )      |                      | ($51,811,223 | )                               |   | ($72,000 | ) |   |  |   | $ | 0 |   |   | ($201,875 | ) |
| Prior                  period adjustment                                                                       |   |                                      | —   |                                               |   | —          |   |            | —   |                |   | —                                   |   |                                  | —    |                         |   | —                   |   |                      | 69,967       |                            |   | — |   |   |   |   |   | 53,326 |   | $ | 123,293 |   |
| Balance,                  December 31, 2003 (restated)                                                         |   |                                      | 1,312,778 |                                               |   | 1,313            |   |            | 1,022,222 |                |   | 1,022                                     |   |                                  | 51,704,944 |                         |   | (25,931                   | )      |                      | (51,741,256  | )                               |   | (72,000 | ) |   |   |   |   | 53,326 |   |   | (78,582 | ) |
|                                                                                                           |   |                                      |      |                                               |   |             |   |            |      |                |   |                                      |   |                                  |       |                         |   |                      |   |                      |         |                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash                  distributions to stockholders                                                            |   |                                      | —   |                                               |   | —          |   |            | —   |                |   | —                                   |   |                                  | —    |                         |   | —                   |   |                      | (272,925     | )                               |   | — |   |   |   |   |   | — |   |   | (272,925 | ) |
|                                                                                                           |   |                                      |      |                                               |   |             |   |            |      |                |   |                                      |   |                                  |       |                         |   |                      |   |                      |         |                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Reduction                  of subscription receivable in lieu of cash dividend to                  stockholder |   |                                      | —   |                                               |   | —          |   |            | —   |                |   | —                                   |   |                                  | —    |                         |   | —                   |   |                      | (27,075      | )                               |   | 27,075 |   |   |   |   |   | — |   |   | — |   |
|                                                                                                           |   |                                      |      |                                               |   |             |   |            |      |                |   |                                      |   |                                  |       |                         |   |                      |   |                      |         |                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Conversion                  of preferred stock to common stock                                                 |   |                                      | 997,222   |                                               |   | 977              |   |            | (997,222  | )                   |   | (977                                      | )      |                                  | —    |                         |   | —                   |   |                      | —      |                            |   |   |   |   |   |   |   | — |   |   | — |   |
|                                                                                                           |   |                                      |      |                                               |   |             |   |            |      |                |   |                                      |   |                                  |       |                         |   |                      |   |                      |         |                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Comprehensive                                                                                                  |   |                                      |      |                                               |   |             |   |            |      |                |   |                                      |   |                                  |       |                         |   |                      |   |                      |         |                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Income:                  Net income                                                                            |   |                                      | —   |                                               |   | —          |   |            | —   |                |   | —                                   |   |                                  | —    |                         |   | —                   |   |                      | 98,749       |                            |   | — |   | $ | 98,749 |   |   | — |   |   | 98,749 |   |
| Unrealized                  investment gain (restated)                                                         |   |                                      |      |                                               |   |             |   |            |      |                |   |                                      |   |                                  |       |                         |   |                      |   |                      |         |                            |   |   |   |   | 9,569 |   |   | 9,569 |   |   | 9,569 |   |
| Comprehensive                  income (restated)                                                               |   |                                      |      |                                               |   |             |   |            |      |                |   |                                      |   |                                  |       |                         |   |                      |   |                      |         |                            |   |   |   | $ | 108,318 |   |   |   |   |   |   |   |
|                                                                                                           |   |                                      |      |                                               |   |             |   |            |      |                |   |                                      |   |                                  |       |                         |   |                      |   |                      |         |                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance,                  March 31, 2004 (restated)                                                            |   |                                      | 2,310,000 |                                               | $      | 2,310            |   |            | 25,000    |                | $      | 25                                        |   | $                                     | 51,704,944 |                         |   | ($25,931                  | )      |                      | ($51,942,507 | )                               |   | ($44,925 | ) |   |   |   | $ | 62,895 |   |   | ($243,189 | ) |

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**PowerCerv            Corporation and Subsidiary**

**Notes            to Condensed Consolidated Financial Statements**

**(Unaudited)**

| **1.** | **Restatement** |
|--------|-----------------|

|                                               |   | As                  Originally  |        |              |   |  As             |   |
|----------------------------------------------------|--------|--------------------------------------|-------------|-------------------|--------|----------------------|--------|
|                                               |   | Reported                        |        | Adjustments  |   | Restated   |   |
|                                               |   |                                 |        |              |   |                 |   |
| Marketable                  equity securities      |   | $                                    | -           |              | $      | 123,293              |   | $ | 123,293 |   |
| Total                  current assets              |   |                                 | 154,086     |              |   | 123,293              |   |   | 277,379 |   |
| Accumulated                  deficit               |   |                                 | (51,811,223 | )                 |   | (69,967              | )      |   | (51,741,256 | ) |
| Accumulated                  other                 |   |                                 |        |              |   |                 |   |   |   |   |
| comprehensive                  income              |   |                                 | -           |              |   | 53,326               |   |   | 53,326 |   |
| Total                  Stockholders’ Deficit |   |                                 | (201,875    | )                 |   | 123,293              |   |   | (78,582 | ) |
| Total                  Liabilities &           |   |                                 |        |              |   |                 |   |   |   |   |
| Stockholders’                  Deficit       |   |                                 | 154,086     |              |   | 123,293              |   |   | 277,379 |   |

| **2.** | **Organization                and Operations** |
|--------|------------------------------------------------|

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**PowerCerv            Corporation and Subsidiary**

**Notes            to Condensed Consolidated Financial Statements**

**(Unaudited)**

| **2.** | **Organization                and Operations (continued)** |
|--------|------------------------------------------------------------|

| **3.** | **Marketable                equity securities** |
|--------|-------------------------------------------------|

|                           |   |   |      | Net                  Unrealized |   | Fair      |   |
|--------------------------------|--------|--------|-----------|---------------------------------|--------|-----------|--------|
|                           |   | Cost   |      | Holding                  Gains  |   | Value     |   |
| Common                  stocks |   | $      | 69,967.00 |                            | $      | 62,895.00 |   | $ | 132,862 |   |

| **4.** | **Accrued                Expenses** |
|--------|-------------------------------------|

|                                   |   |   |       |
|----------------------------------------|--------|--------|------------|
| Income                  tax assessment |   | $      | 227,296.00 |   |
| Other                                  |   |   | 42,139     |   |
|                                   |   | $      | 269,435.00 |   |

| **5.** | **Stockholders'                equity** |
|--------|-----------------------------------------|

| **6.** | **Net                loss per share** |
|--------|---------------------------------------|

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**PowerCerv              Corporation and Subsidiary**

**Notes              to Condensed Consolidated Financial Statements**

**(Unaudited)**

| **7.** | **Income                taxes** |
|--------|---------------------------------|

|                                           |   | 2004   |    | 2003   |   |
|------------------------------------------------|--------|--------|---------|--------|--------|
| Current                                        |   | $      | — |   | $      | — |   |
| Deferred                                       |   |   | 37,500  |   |   | (23,000 | ) |
| Change                  in valuation allowance |   |   | (37,500 | )      |   | 23,000 |   |
| Total                  income tax expense      |   | $      | — |   | $      | — |   |

|                                                                                              |   | 2004   |        |
|---------------------------------------------------------------------------------------------------|--------|--------|-------------|
|                                                                                              |   |   |             |   |
| Net                  operating loss carryforwards (subject to annual                  limitation) |   | $      | 13,985,000  |   |
| Valuation                  allowance                                                              |   |   | (13,985,000 | ) |
|                                                                                              |   | $      | —     |   |

| **8.** | **Related                party transactions:** |
|--------|------------------------------------------------|

| **9.** | **Subsequent                    event** |
|--------|-----------------------------------------|

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**Item      2.  Management’ Discussion and Analysis or Plan of      Operations**

**Overview**

**Results      of operations**

*General      and Administrative (“G&A”). *

----

**Item      2.  Management’ Discussion and Analysis or Plan of Operations      (continued)**

*Other      income*

*Dividends      and Preferred Stock Conversion*

*Income      taxes *

**Liquidity      and Capital Resources**

----

**Item      2.  Management’ Discussion and Analysis or Plan of Operations      (continued)**

**Liquidity      and Capital Resources (continued)**

|                                          |   | March                  31, 2004 |    |
|-----------------------------------------------|--------|---------------------------------|---------|
|                                          |   |                            |    |
| Working                  capital deficit      |   | ($                              | 241,298 | ) |
| Cash                  and cash equivalents    |   | $                               | 0       |   |
| Marketable                  equity securities |   | $                               | 132,862 |   |

|                                                                   |   |  For                  the                       |     |
|------------------------------------------------------------------------|--------|-----------------------------------------------------------|----------|
|                                                                   |   |  Three                  months ended March 31,  |     |
|                                                                   |   |  2004                                           |     |  Change  |   |  2003  |   |
| Cash                  flows provided by (used) in operating activities |   |                                                      | 76,525   |   |   | 137 | % |   | (206,000 | ) |
| Cash                  flows provided by investing activities           |   |                                                      | 110,000  |   |   | 423 | % |   | 21,000 |   |
| Cash                  flows used in financing activities               |   |                                                      | (219,611 | ) |   | (100 | %) |   | — |   |

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**ITEM      3.  CONTROLS AND PROCEDURES.**

----

**Part      II.  Other Information**

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

**Item      6.**
**      Exhibits and Reports on Form 8-K**

| (a) | Exhibits |
|-----|----------|

| (b) | Reports                on Form 8-K |
|-----|------------------------------------|

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**Signatures**

|                                       |                                                                                                                                               |                                   |
|--------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------|
|                                       | POWERCERV              CORPORATION                                                                                                                 |
|                                  |                                                                                                                                          |                              |
| Date: September              26, 2005 |                                                                                                                                               | /s/ John              D. Stanton, |
|                                       | John              D. Stanton                                                                                                                       |
|                                       | Chairman,                  Principal Financial Officer and Principal                  Accounting Officer(Duly                  Authorized Officer) |

----

**PowerCerv      Corporation**

**EXHIBIT      INDEX**

| EXHIBIT                  NUMBER | DESCRIPTION                                                                                                                                                                                                                        | PAGE     |
|---------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------|
|                            |                                                                                                                                                                                                                               |     |
| 31.                  1          | Certification                  to Section 302 of the Sarbanes-Oxley Act of                  2002 - Chief Executive Officer                                                                                                         |  16 |
|                            |                                                                                                                                                                                                                               |     |
| 31.2                            | Certification                  to Section 302 of the Sarbanes-Oxley Act of                  2002 - Chief Financial Officer                                                                                                         |  17 |
|                            |                                                                                                                                                                                                                               |     |
| 32.1                            | Certification                    pursuant to 18 U.S.C. Section 1350,                    as adopted  pursuant                    to Section 906 of the Sarbanes-Oxley Act of 2002 - Chief                    Executive Officer |  18 |
|                            |                                                                                                                                                                                                                               |     |
| 32.2                            |  Certification                  pursuant to 18 U.S.C. Section 1350, as                  adopted pursuant                  to Section 906 of the Sarbanes-Oxley Act of 2002 - Chief                  Financial Officer         | 19       |

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