##### Table of Contents









UNITED STATES SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549





Form 10-K


|           |  |                                                                                             
|---------- |  | --------------------------------------------------------------------------------------------
|(Mark One) |  |                                                                                             
|þ          |  | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934    
|           |  | For the fiscal year ended January 3, 2006                                                   
|o          |  | 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 001-31904


CENTERPLATE, INC.


(Exact name of registrant as specified in its charter)


|                                                                 |  |                                                     
|---------------------------------------------------------------- |  | ----------------------------------------------------
|Delaware                                                         |  | 13-3870167                                          
|(State of incorporation)                                         |  | (I.R.S. Employer
     Identification No.)           
|201 East Broad Street                                            |  | (864)598-8600                                       
|Spartanburg, South Carolina 29306                                |  | (Registrants telephone number, including area code)
|(Address of principal executive offices, including zip
    code) |  |                                                     

http://www.centerplate.com


(Registrants URL)


Securities of Centerplate, Inc. registered pursuant to
Section 12(b) of the Act


|                                                                                            |  |                                                   
|------------------------------------------------------------------------------------------- |  | --------------------------------------------------
|Title of Each Class                                                                         |  | Name of Each Exchange on Which Registered         
|                                                                                            |  |                                                   
|Income Deposit Securities (representing shares of
     common stock and subordinated notes) |  | American Stock Exchange
    Toronto Stock Exchange

Securities of Centerplate, Inc. registered pursuant to
Section 12(g) of the Act:


None


o þ


o þ


þ o


S-K 10-K 10-K. þ


12b-2


o þ o


12b-2 o þ






DOCUMENTS INCORPORATED BY REFERENCE


10-K. 10-K










---



##### 










CENTERPLATE, INC.


FISCAL YEAR 2005


Form 10-K


ANNUAL REPORT





TABLE OF CONTENTS


|                                                           |  |                                                                                                                      |  |      |     | 
|---------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------- |  | ---- | --- | 
|                                                           |  |                                                                                                                      |  | Page |    
|                                                           |  |                                                                                                                      |  |      |    
|PART I                                                    
|Item 1.                                                    |  | Business                                                                                                             |  |      | 3   | 
|Item 1A.                                                   |  | Risk Factors                                                                                                         |  |      | 12  | 
|Item 1B.                                                   |  | Unresolved Staff Comments                                                                                            |  |      | 27  | 
|Item 2.                                                    |  | Properties                                                                                                           |  |      | 27  | 
|Item 3.                                                    |  | Legal Proceedings                                                                                                    |  |      | 27  | 
|Item 4.                                                    |  | Submission of Matters to a Vote of Security
    Holders                                                              |  |      | 29  | 
|                                                          
|PART II                                                   
|Item 5.                                                    |  | Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities |  |      | 29  | 
|Item 6.                                                    |  | Selected Financial Data                                                                                              |  |      | 32  | 
|Item 7.                                                    |  | Managements Discussion and Analysis
    of Financial Condition and Results of Operations                            |  |      | 36  | 
|Item 7A.                                                   |  | Quantitative and Qualitative Disclosures
    About Market Risk                                                       |  |      | 49  | 
|Item 8.                                                    |  | Financial Statements and Supplementary
    Data                                                                      |  |      | F-1 | 
|Item 9.                                                    |  | Changes in and Disagreements with
    Accountants on Accounting and Financial Disclosure                             |  |      | 50  | 
|Item 9A.                                                   |  | Controls and Procedures                                                                                              |  |      | 50  | 
|Item 9B.                                                   |  | Other Information                                                                                                    |  |      | 52  | 
|                                                          
|PART III                                                  
|Item 10.*                                                  |  | Directors and Executive Officers of the Registrant                                                                   |  |      |     | 
|Item 11.*                                                  |  | Executive Compensation                                                                                               |  |      |     | 
|Item 12.*                                                  |  | Security Ownership of Certain Beneficial Owners and Management
    and Related Stockholder Matters                   |  |      |     | 
|Item 13.*                                                  |  | Certain Relationships and Related Transactions                                                                       |  |      |     | 
|Item 14.*                                                  |  | Principal Accountant Fees and Services                                                                               |  |      |     | 
|                                                          
|PART IV                                                   
|Item 15.                                                   |  | Exhibits and Financial Statement
    Schedules                                                                       |  |      | 52  | 
|EX-10.11: FORM OF CONSENT AND AMENDMENT                   
|EX-12.1: COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
|EX-21.1: SUBSIDIARIES OF CENTERPLATE, INC.                
|EX-31.1: CERTIFICATION                                    
|EX-31.2: CERTIFICATION                                    
|EX-32.1: CERTIFICATION                                    
|EX-32.2: CERTIFICATION                                    








|  |                                                                                                                                                                                                               
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|* | Incorporated by reference to the registrants definitive
    proxy statement for its 2006 annual meeting of security holders,
    which proxy statement is expected to be filed not later than
    May 3, 2006

2



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##### Table of Contents






PART I


Introductory Note


Throughout this Annual Report on
Form 10-K, we
refer to Centerplate, Inc., a Delaware corporation, as
Centerplate, and, together with its consolidated
operations, as we, our and
us, unless otherwise indicated. Any reference to
VSA refers to our wholly owned subsidiary, Volume
Services America, Inc., a Delaware corporation, and its
consolidated operations, unless otherwise indicated. Centerplate
is a holding company and has no direct operations. In addition
to VSA, Centerplates subsidiaries also include Volume
Services, Inc. (VS) and Service America Corporation
(Service America), each a Delaware corporation.


When discussing the number of facilities we serve, we have
counted all facilities held by a single client as one facility,
even though we sometimes service more than one building or
location for a particular client. For instance, under our client
relationship with the New York Racing Association, which is
included as one facility, we service buildings at three
different locations: the Aqueduct Racetrack, Belmont Park
Racetrack and Saratoga Race Course.







|        |         
|------- | --------
|Item 1. | Business

Overview






| |   |                                                                                                                                                                                 
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | One of the two largest providers to National Football League
    (NFL) facilities (11 teams);                                                                                 
|
| |  | The third largest provider to Major League Baseball
    (MLB) facilities (6 teams);                                                                                           
|
| |  | The largest provider to minor league baseball and spring
    training facilities (25 teams); and                                                                                
|
| |  | One of the largest providers to major convention centers, which
    we define as those with greater than approximately
    300,000 square feet of exhibition space (10 centers).







| |   |                                                        
| | - | -------------------------------------------------------
| |  | 24 World Series games;                                 
|
| |  | Nine U.S. Presidential Inaugural Balls;                
|
| |  | 10 Super Bowls;                                        
|
| |  | Eight NCAA Final Four Mens Basketball Tournaments; and
|
| |  | 14 World Cup Soccer games.                             

History




3



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Clients and Services




| |         
| | --------
| | Overview





state-of








4



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|                                    |  |      |      |   |      |  |      |      |  |  |     |  
|----------------------------------- |  | ---- | ---- | - | ---- |  | ---- | ---- |  |  | --- | -
|                                    |  | 2006 |      |   | 2007 |  |      | 2008 | 
|                                    |  |      |      |   |      |  |      |      | 
|Facility Category                   |  |      |      |   |      |  |      |      |  |  |     |  
|Sports facilities                   |  |      | 13   |   |      |  | 6    |      |  |  | 8   |  
|Convention centers                  |  |      | 19   |   |      |  | 7    |      |  |  | 3   |  
|Other entertainment facilities      |  |      | 16   |   |      |  | 2    |      |  |  | 4   |  
|                                    |  |      |      |   |      |  |      |      | 
|Total number of contracts           |  |      | 38   |   |      |  | 15   |      |  |  | 15  |  
|Percentage of fiscal 2005 net sales |  |      | 24.1 | % |      |  | 14.7 | %    |  |  | 9.2 | %



| |              
| | -------------
| | Concentration





| |                  
| | -----------------
| | Sports Facilities







5



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|                                   |  |          |                    |  |                    |          |                      |         |  |  |              | 
|---------------------------------- |  | -------- | ------------------ |  | ------------------ | -------- | -------------------- | ------- |  |  | ------------ | 
|                                   |  |          |                    |  |                    | Seating  |                     
|                                   |  |          |                    |  |                    | Capacity |                     
|Facility Name                      |  | Location |                    |  | Sports Team Tenant |          |                      | (Sport) | 
|                                   |  |          |                    |  |                    |          |                      |         | 
|ALLTEL Stadium                     |  |          | Jacksonville, FL   |  |                    |          | Jacksonville Jaguars |         |  |  | 73,000 (NFL) | 
|Arrowhead Stadium                  |  |          | Kansas City, MO    |  |                    |          | Kansas City Chiefs   |         |  |  | 79,000 (NFL) | 
|AT&T Park (formerly SBC Park)      |  |          | San Francisco, CA  |  |                    |          | San Francisco Giants |         |  |  | 42,000(MLB)  | 
|FedEx Field                        |  |          | Landover, MD       |  |                    |          | Washington Redskins  |         |  |  | 92,000 (NFL) | 
|HHH Metrodome                      |  |          | Minneapolis, MN    |  |                    |          | Minnesota Vikings    |         |  |  | 64,000 (NFL) | 
|                                   |  |          |                    |  |                    |          | Minnesota Twins      |         |  |  | 44,000(MLB)  | 
|INVESCO Field at Mile High Stadium |  |          | Denver, CO         |  |                    |          | Denver Broncos       |         |  |  | 76,000(NFL)  | 
|Kauffman Stadium                   |  |          | Kansas City, MO    |  |                    |          | Kansas City Royals   |         |  |  | 40,600(MLB)  | 
|Louisiana Superdome                |  |          | New Orleans, LA    |  |                    |          | New Orleans Saints   |         |  |  | 70,054(NFL)  | 
|Monster Park                       |  |          | San Francisco, CA  |  |                    |          | San Francisco 49ers  |         |  |  | 68,000(NFL)  | 
|New Orleans Arena                  |  |          | New Orleans, LA    |  |                    |          | New Orleans Hornets  |         |  |  | 18,500(NBA)  | 
|Palace of Auburn Hills             |  |          | Auburn Hills, MI   |  |                    |          | Detroit Pistons      |         |  |  | 21,000(NBA)  | 
|Qualcomm Stadium                   |  |          | San Diego, CA      |  |                    |          | San Diego Chargers   |         |  |  | 71,400(NFL)  | 
|RCA Dome                           |  |          | Indianapolis, IN   |  |                    |          | Indianapolis Colts   |         |  |  | 60,000(NFL)  | 
|Safeco Field                       |  |          | Seattle, WA        |  |                    |          | Seattle Mariners     |         |  |  | 47,145(MLB)  | 
|The Coliseum                       |  |          | Nashville, TN      |  |                    |          | Tennessee Titans     |         |  |  | 68,500(NFL)  | 
|Tropicana Field                    |  |          | St. Petersburg, FL |  |                    |          | Tampa Bay Devil Rays |         |  |  | 48,500(MLB)  | 
|Xcel Energy Center                 |  |          | St. Paul, MN       |  |                    |          | Minnesota Wild       |         |  |  | 18,064(NHL)  | 
|Yankee Stadium                     |  |          | New York, NY       |  |                    |          | New York Yankees     |         |  |  | 55,000(MLB)  | 



| |                   
| | ------------------
| | Convention Centers







6



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|                                         |  |          |                  |          |             |  |           | 
|---------------------------------------- |  | -------- | ---------------- | -------- | ----------- |  | --------- | 
|                                         |  |          |                  | Size     |            
|                                         |  |          |                  | (Approx. |            
|Facility Name                            |  | Location |                  |          | Sq. Ft.)(1) | 
|                                         |  |          |                  |          |             | 
|Dallas Convention Center                 |  |          | Dallas, TX       |          |             |  | 1,019,142 | 
|Indiana Convention Center                |  |          | Indianapolis, IN |          |             |  | 493,123   | 
|Jacob K. Javits Center                   |  |          | New York, NY     |          |             |  | 814,400   | 
|Kentucky Fair & Expo Center              |  |          | Louisville, KY   |          |             |  | 1,068,050 | 
|Sacramento Civic Center                  |  |          | Sacramento, CA   |          |             |  | 158,288   | 
|San Diego Convention Center              |  |          | San Diego, CA    |          |             |  | 616,363   | 
|Vancouver Convention & Exhibition Centre |  |          | Vancouver, BC    |          |             |  | 108,000   | 
|Washington Convention Center             |  |          | Washington, DC   |          |             |  | 725,000   | 






|    |                                                                
|--- | ---------------------------------------------------------------
|(1) | Source: Tradeshow Weeks Major Exhibit Hall Directory
    2005.



| |                               
| | ------------------------------
| | Other Entertainment Facilities









|                                                                                                |  |          |                  |  |            |  |                  | 
|----------------------------------------------------------------------------------------------- |  | -------- | ---------------- |  | ---------- |  | ---------------- | 
|Facility Name                                                                                   |  | Location |                  |  | Venue Type | 
|                                                                                                |  |          |                  |  |            | 
|Dover Downs                                                                                     |  |          | IL, TN           |  |            |  | Speedway         | 
|DTE Energy Music Theatre                                                                        |  |          | Auburn Hills, MI |  |            |  | Amphitheater     | 
|Los Angeles Zoo                                                                                 |  |          | Los Angeles, CA  |  |            |  | Zoo              | 
|National Hot Rod Association                                                                    |  |          | FL, GA, IN, OH   |  |            |  | Speedways        | 
|New York Racing Association (Belmont Park and Aqueduct
    Racetracks and Saratoga Race Course) |  |          | NY               |  |            |  | Horse Racetracks | 

Client Contracts






7



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| |                          
| | -------------------------
| | Profit and Loss Contracts







| |                         
| | ------------------------
| | Profit Sharing Contracts





| |                         
| | ------------------------
| | Management Fee Contracts

on-site




| |                                    
| | -----------------------------------
| | Additional Contract Characteristics





8



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Sales and Marketing




on-site






Competition




| |            
| | -----------
| | Competitors











| |                          
| | -------------------------
| | Competition for Contracts



9



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Suppliers










Controls




Employees


on-site


10



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Seasonality of Operations






Regulatory Matters












11



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Environmental Matters








Intellectual Property




Available Information


10-K, 10-Q 8-K,





Item 1A.     Risk
Factors


An investment in our securities including the IDSs, and the
shares of our common stock and our subordinated notes
represented by the IDSs, involves a number of risks. There are a
number of important factors that could affect our business and
future operating results, including without limitation, the
factors set forth below. The information contained in this
annual report should be read in light of such factors.


Risks Relating to the IDSs and the Shares of Common Stock and
Subordinated Notes Represented by the IDSs




| |                                                                                                                                                                                                                                                                                            
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We have substantial indebtedness, which could restrict our
    ability to pay interest and principal on the subordinated notes
    and to pay dividends with respect to shares of our common stock
    represented by the IDSs and impact our financing options and
    liquidity position.



12



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| |   |                                                                                                                                                                                                                                                                                           
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | our ability in the future to obtain additional financing for
    working capital, capital expenditures or acquisitions may be
    limited;                                                                                                                                                
|
| |  | our ability to refinance our indebtedness on terms acceptable to
    us or at all may be limited;                                                                                                                                                                                         
|
| |  | our funds available for future operations, capital expenditures
    and/or dividends on our common stock may be reduced due to a
    significant portion of our cash flow from operations being
    dedicated to the payment of the principal of and interest on our
    indebtedness; and
|
| |  | our vulnerability to economic downturns may increase and our
    ability to withstand competitive pressures may be limited.                                                                                                                                                               





| |                                                                                                         
| | --------------------------------------------------------------------------------------------------------
| | Our dividend policy may negatively impact our ability to
    finance capital expenditures or operations.





| |                                                                                                                                                                                                                                              
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We may amend the terms of our credit facility, or we may
    enter into new agreements that govern our senior indebtedness
    with terms that may significantly affect our ability to pay
    interest and dividends to our securityholders.





| |                                                                                                                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We are subject to restrictive debt covenants and other
    requirements related to our outstanding debt that limit our
    business flexibility by imposing operating and financial
    restrictions on our operations.





| |   |                                                                                                                        
| | - | -----------------------------------------------------------------------------------------------------------------------
| |  | the incurrence of additional indebtedness and the issuance of
    preferred stock and certain redeemable capital stock;
|
| |  | the payment of dividends on, and purchase or redemption of,
    capital stock;                                         

13



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| |   |                                                                                     
| | - | ------------------------------------------------------------------------------------
| |  | a number of other restricted payments, including investments;                       
|
| |  | specified sales of assets:                                                          
|
| |  | specified transactions with affiliates;                                             
|
| |  | the creation of a number of liens; and                                              
|
| |  | consolidations, mergers and transfers of all or substantially
    all of our assets.







| |                                                                                                                                                                                               
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We are a holding company and rely on dividends, interest
    and other payments, advances and transfers of funds from our
    subsidiaries to meet our debt service and other
    obligations.





| |                                                                                                                                        
| | ---------------------------------------------------------------------------------------------------------------------------------------
| | Our interest expense may increase significantly and could
    cause our net income and distributable cash to decline
    significantly.



14



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| |                                                                                                                                                                           
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We may not generate sufficient funds from operations to
    pay our indebtedness at maturity or upon the exercise by holders
    of their rights upon a change of control.





| |                                                                                                                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | To service our indebtedness and to fund our liquidity
    needs, we will require a significant amount of cash which may
    not be available to us. Our ability to generate cash depends on
    many factors beyond our control.







| |                                                                                                                                        
| | ---------------------------------------------------------------------------------------------------------------------------------------
| | We may not be able to repay or refinance the subordinated
    notes, or our credit facility, upon terms acceptable to us if at
    all.





| |   |                                                                                                                                                                                
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | sale of assets to meet our debt service requirements;                                                                                                                          
|
| |  | sale of equity;                                                                                                                                                                
|
| |  | negotiations with our lenders or noteholders to restructure the
    applicable debt; and                                                                                       
|
| |  | seeking protection under the U.S. federal bankruptcy code
    or other applicable bankruptcy, insolvency or other applicable
    laws dealing with creditors rights generally.





| |                                                                                                                                                                                      
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The indenture governing our subordinated notes and our
    credit facility permit us to pay a significant portion of our
    free cash flow to stockholders in the form of dividends.



15



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| |                                                                                               
| | ----------------------------------------------------------------------------------------------
| | The realizable value of our assets upon liquidation may be
    insufficient to satisfy claims.





| |                                                                                                                                                                                                                                     
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Because of the subordinated nature of the subordinated
    notes, holders of our subordinated notes may not be entitled to
    be paid in full, if at all, in a bankruptcy, liquidation or
    reorganization or similar proceeding.









16



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| |                                                                                                                                                                                                                                                                               
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | In the event of bankruptcy or insolvency, our
    investors ability to recover amounts owed on the
    subordinated notes and guarantees of the notes by our
    subsidiaries could be adversely affected by principles of
    equitable subordination or recharacterization.





| |                                                                                                                           
| | --------------------------------------------------------------------------------------------------------------------------
| | Holders of our subordinated notes will be structurally
    subordinated to the debt of our non-guarantor
    subsidiaries.









| |                                                                                                                                                                                                                             
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The validity and enforceability of the subordinated notes
    and the guarantees of the subordinated notes by our subsidiaries
    may be limited by fraudulent conveyance laws and foreign laws
    restricting guarantees.





| |                                                                                                                                                                                                      
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Seasonality and variability of our business may cause
    volatility in the market value of an investment in Centerplate
    and may hinder our ability to make timely distributions on the
    IDSs.





| |   |                                                                  
| | - | -----------------------------------------------------------------
| |  | seasonality of sporting and other events;                        
|
| |  | unpredictability in the number, timing and type of new contracts;

17



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| |   |                                                       
| | - | ------------------------------------------------------
| |  | timing of contract expirations and special events; and
|
| |  | level of attendance at facilities which we serve.     







| |                                                                                                             
| | ------------------------------------------------------------------------------------------------------------
| | The U.S. federal income tax consequences of the
    purchase, ownership and disposition of IDSs are unclear.





| |                                                                                                                                                             
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The IRS or the courts could successfully assert a
    treatment of the IDSs different than our intended treatment,
    which could affect our tax liability.

grossed-up




| |                                                                                                                                                                                                                                                                                    
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Interest on the subordinated notes may not be deductible
    by us for U.S. federal income tax purposes, which could
    adversely affect our financial condition, significantly reduce
    our future cash flow and impact our ability to make interest and
    dividend payments.

non-U.S.


18



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| |                                                                                                                                                                                          
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We may have to establish a reserve for contingent tax
    liabilities in the future, which could adversely affect our
    ability to make interest and dividend payments on the
    IDSs.





| |                                                                       
| | ----------------------------------------------------------------------
| | If interest rates rise, the trading value of our IDSs may
    decline.





| |                                                                              
| | -----------------------------------------------------------------------------
| | An active trading market for IDSs has not developed in the
    United States.





| |                                                                                                        
| | -------------------------------------------------------------------------------------------------------
| | We do not expect our common stock or subordinated notes to
    develop separate active trading markets.





| |                                                                                                                                                                                                                                             
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | If the IDSs automatically separate, the limited liquidity
    of the market for the subordinated notes and shares of common
    stock may adversely affect investors ability to sell the
    subordinated notes and shares of common stock.



19



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| |                                                                                                      
| | -----------------------------------------------------------------------------------------------------
| | The price of the IDSs may fluctuate substantially, which
    could negatively affect holders of IDSs.





| |                                                                                                                                                                                                                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The accounting treatment for the IDSs and subordinated
    notes is complex and subject to judgments concerning the
    valuation of embedded derivative rights within the indenture
    governing the subordinated notes. Fluctuations in the valuation
    of these rights could make our financial results
    unpredictable.





| |                                                                                            
| | -------------------------------------------------------------------------------------------
| | A sudden, large number of separations or combinations of
    our IDSs could be very costly.





| |                                                                                                                                                                       
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our indenture and credit agreement contain provisions that
    could make a takeover more expensive, which could have the
    effect of discouraging possible bidders.



Risks Relating to our Business and the Industry




| |                                                                                                                                                  
| | -------------------------------------------------------------------------------------------------------------------------------------------------
| | If attendance or the number of events held at our
    clients facilities decreases, our net sales and cash flow
    would significantly decline.





| |   |                                                         
| | - | --------------------------------------------------------
| |  | maintenance and physical condition of the facility;     
|
| |  | poor performance by the sports teams using the facility;

20



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| |   |                                                                                                               
| | - | --------------------------------------------------------------------------------------------------------------
| |  | relocation or loss of a major sports team using a facility;                                                   
|
| |  | ticket prices;                                                                                                
|
| |  | changing consumer preferences for leisure time activities;                                                    
|
| |  | inclement weather;                                                                                            
|
| |  | natural disasters;                                                                                            
|
| |  | power outages;                                                                                                
|
| |  | scheduling of conventions, meetings and large catered events;                                                 
|
| |  | construction of attractive alternative arenas, stadiums,
    convention centers or other venues or facilities;
|
| |  | labor stoppages; and                                                                                          
|
| |  | weaker economic conditions.                                                                                   





| |                                                                                                                                          
| | -----------------------------------------------------------------------------------------------------------------------------------------
| | The pricing and termination provisions of our contracts
    may limit our ability to recover costs or make a profit on our
    contracts.









| |                                                                         
| | ------------------------------------------------------------------------
| | We have a history of losses and may experience losses in
    the future.



21



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| |                                                                                                                                                  
| | -------------------------------------------------------------------------------------------------------------------------------------------------
| | We may not be able to recover our capital investments in
    clients facilities, which may significantly reduce our
    profits or cause losses.





| |                                                                                                                                                                
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------
| | If the sports team tenant of a facility we serve relocates
    or the ownership of a facility we serve changes, we may lose the
    contract for that facility.





| |                                                                                              
| | ---------------------------------------------------------------------------------------------
| | If we were to lose any of our largest clients, our net
    sales would decline significantly.





| |   |                                                                                            
| | - | -------------------------------------------------------------------------------------------
| |  | our largest client accounted for approximately 9.8% of our net
    sales;                  
|
| |  | our three largest clients together accounted for approximately
    20.0% of our net sales; 
|
| |  | our 10 largest clients together accounted for approximately
    40.9% of our net sales; and
|
| |  | our 20 largest clients together accounted for approximately
    58.9% of our net sales.    





| |                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------
| | If any significant client were to become bankrupt, our
    revenues would be likely to decline and we could lose our
    investment in the client.





| |                                                                                                                                                                                              
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | A contraction of MLB, or other sports played in facilities
    that we service, that eliminates any of the teams playing in any
    of the facilities served by us could reduce our revenues.



22



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| |                                                                                                                                                                                                          
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We may not have sufficient funds available to make capital
    investments in clients facilities that are necessary to
    maintain these relationships and as a consequence we could lose
    business.





| |                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------
| | Increased capital investments or commissions to renew
    existing business relationships may lower our operating results
    for such facilities.





| |                                                                                                                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our cash resources may be strained and we may need to seek
    additional financing from time to time because of the need to
    make capital investments in order to obtain or maintain
    contractual relationships.





| |                                                                                                                                                                          
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our historical growth rates may not be indicative of
    future results, given our capital structure and dividend policy
    and our reliance on other financing sources.





| |                                                                                                                                                                                                        
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | If labor or other operating costs increase, we may not be
    able to make a corresponding increase in the prices of our
    products and services and our profitability may decline
    significantly.



23



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| |                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------
| | We are heavily dependent on key personnel, and a loss of
    such personnel could have a detrimental effect on our
    business.





| |                                                                                            
| | -------------------------------------------------------------------------------------------
| | We could incur significant liability for withdrawing from
    multi-employer pension plans.





| |                                                                                                                                                                                                 
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We may incur significant liabilities or harm to our
    reputation if claims of illness or injury associated with our
    service of food and beverage to the public are brought against
    us.





| |   |                                                    
| | - | ---------------------------------------------------
| |  | consumer product liability;                        
|
| |  | product tampering;                                 
|
| |  | nutritional and health-related concerns; and       
|
| |  | federal, state, provincial and local food controls.





| |                                                                                                                    
| | -------------------------------------------------------------------------------------------------------------------
| | The loss of any of our liquor licenses or permits would
    adversely affect our ability to carry out our business.



24



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| |                                                                                                                                                             
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------
| | If one of our employees sells alcoholic beverages to an
    intoxicated or minor patron, we could be liable to third parties
    for the acts of the patron.







| |                                                                                                                                                                                                                                                                                
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | If we fail to comply with applicable governmental
    regulations, we may become subject to lawsuits and other
    liabilities or restrictions on our operations which could
    significantly reduce our net sales and cash flow and undermine
    the growth of our business.





| |   |                                             
| | - | --------------------------------------------
| |  | the service of food and alcoholic beverages;
|
| |  | minimum wage;                               
|
| |  | other employment terms and conditions;      
|
| |  | environmental protection; and               
|
| |  | human health and safety.                    







| |                                                                                     
| | ------------------------------------------------------------------------------------
| | We are subject to litigation, which, if determined
    adversely, could be material.





| |                                                                                                                                                                                                                                           
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | If we fail to remain competitive within our industry, we
    will not be able to maintain our clients or obtain new clients,
    which would materially adversely affect our financial condition,
    results of operations and liquidity.



25



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##### Table of Contents









| |   |                                                  
| | - | -------------------------------------------------
| |  | the ability to make capital investments;         
|
| |  | commission or management fee structures;         
|
| |  | service innovation;                              
|
| |  | quality and breadth of products and services; and
|
| |  | reputation within the industry.                  





| |                                                                                                                                                                                               
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | An outbreak or escalation of any insurrection or armed
    conflict involving the United States or any other national or
    international calamity could significantly harm our
    business.







| |                                                                                                                                                                                                                                                                       
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | A terrorist attack on any facility which we serve,
    particularly large sports facilities, could significantly harm
    our business, and our contracts do not provide for the recovery
    by us of our costs in the event of a terrorist attack on a
    facility.



26



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##### Table of Contents





| |                                                                                                                                                                                                  
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | A natural disaster such as Hurricane Katrina, or a
    pandemic such as a widespread outbreak of avian flu, could have
    a material adverse effect on our financial condition and
    business.







| |                                                                                                                                                                                                                                
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We may not be able to obtain insurance, or obtain
    insurance on commercially acceptable terms, which could result
    in significant liabilities and cause a default under contracts
    requiring us to maintain insurance.





| |                                                                                                                                                                                                               
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Failure to achieve and maintain effective internal
    controls in accordance with Section 404 of the
    Sarbanes-Oxley Act of 2002 could have a material adverse effect
    on our business and stock price.






Item 1B.     Unresolved
Staff Comments









|        |           
|------- | ----------
|Item 2. | Properties

Properties











|        |                  
|------- | -----------------
|Item 3. | Legal Proceedings

Litigation




27



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##### Table of Contents





Cooper Industries, Inc. v. Aviall Services




clean-up


10-K, Holden v. Volume
Services America, Inc. et al.


Perez v. Volume Services Inc, d/b/a Centerplate Perez Holden. Holden.


28



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##### Table of Contents



Holden Perez Holden









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






PART II







|        |                                                                                                                     
|------- | --------------------------------------------------------------------------------------------------------------------
|Item 5. | Market for Registrants Common Equity, Related
    Stockholder Matters and Issuer Purchases of Equity
    Securities



|               |  |      |       |  |     |   |       | 
|-------------- |  | ---- | ----- |  | --- | - | ----- | 
|               |  | High |       |  | Low |  
|               |  |      |       |  |     |  
|Fiscal 2004    |  |      |       |  |     |   |       | 
|First Quarter  |  | $    | 17.80 |  |     | $ | 15.37 | 
|Second Quarter |  | $    | 16.70 |  |     | $ | 12.98 | 
|Third Quarter  |  | $    | 14.85 |  |     | $ | 13.20 | 
|Fourth Quarter |  | $    | 14.71 |  |     | $ | 11.86 | 
|Fiscal 2005    |  |      |       |  |     |   |       | 
|First Quarter  |  | $    | 14.05 |  |     | $ | 12.40 | 
|Second Quarter |  | $    | 12.80 |  |     | $ | 12.10 | 
|Third Quarter  |  | $    | 13.04 |  |     | $ | 10.90 | 
|Fourth Quarter |  | $    | 13.05 |  |     | $ | 10.20 | 

29



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|               |  |      |         |  |     |     |         | 
|-------------- |  | ---- | ------- |  | --- | --- | ------- | 
|               |  | High |         |  | Low |    
|               |  |      |         |  |     |    
|Fiscal 2004    |  |      |         |  |     |     |         | 
|First Quarter  |  |      | C$23.40 |  |     |     | C$20.35 | 
|Second Quarter |  |      | C$22.16 |  |     |     | C$17.44 | 
|Third Quarter  |  |      | C$19.35 |  |     |     | C$17.50 | 
|Fourth Quarter |  |      | C$18.72 |  |     |     | C$14.70 | 
|Fiscal 2005    |  |      |         |  |     |     |         | 
|First Quarter  |  | CS$  | 17.00   |  |     | CS$ | 15.50   | 
|Second Quarter |  | CS$  | 16.00   |  |     | CS$ | 15.20   | 
|Third Quarter  |  | CS$  | 16.10   |  |     | CS$ | 13.01   | 
|Fourth Quarter |  | CS$  | 15.00   |  |     | CS$ | 12.30   | 

10-K,


Dividend Policy and Restrictions








| |   |                                                                                                                                                                                                                                     
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Nothing requires us to pay dividends;                                                                                                                                                                                               
|
| |  | While our current dividend policy contemplates the distribution
    of a substantial portion of our cash, this policy could be
    modified or revoked at any time;                                                                 
|
| |  | Even if our dividend policy were not modified or revoked, the
    actual amount of dividends distributed under the policy and the
    decision to make any distribution is entirely at the discretion
    of our board of directors;
|
| |  | The amount of dividends distributed is subject to debt covenant
    restrictions under our indenture, our credit facility and other
    indebtedness;                                                                               
|
| |  | The distribution and amount of dividends distributed is subject
    to state law restrictions;                                                                                                                                      
|
| |  | Our board of directors may determine to use or retain our cash
    for other purposes;                                                                                                                                              
|
| |  | Our stockholders have no contractual or other legal right to
    dividends; and                                                                                                                                                     
|
| |  | We may not have enough cash to pay dividends due to changes to
    our operating earnings, working capital requirements and
    anticipated cash needs.                                                                             

30



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30-day








| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We may not pay dividends if the payment will exceed the
    quarterly base dividend level in any fiscal quarter; provided
    that if the payment is less than the quarterly base dividend
    level in any fiscal quarter, 50% of the difference between the
    aggregate amount of dividends actually paid and the quarterly
    base dividend level for the quarter will be available for the
    payment of dividends at a later date. The quarterly base
    dividend level for any given fiscal quarter equals 85% of our
    excess cash (as defined below) for the
    12-month period ending
    on the last day of our then most recently ended fiscal quarter
    for which internal financial statements are available at the
    time the dividend is declared and paid, divided by four (4).
    Excess cash means, with respect to any period,
    Adjusted EBITDA, as defined in the indenture, minus the sum of
    (i) cash interest expense and (ii) cash income tax
    expense, in each case, for the period;
|
| |  | We may not pay any dividends if not permitted under any of our
    senior indebtedness;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| |  | We may not pay any dividends while interest on the subordinated
    notes is being deferred or, after the end of any interest
    deferral, so long as any deferred interest has not been paid in
    full; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| |  | We may not pay any dividends if a default or event of default
    under the indenture has occurred and is continuing.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                







31



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|        |                        
|------- | -----------------------
|Item 6. | Selected Financial Data

10-K, 10-K.


|                                                                                      |                     |                                      |       |      |      |   |       |      |   |   |       |      |   |      |       |      |   |   |       |      |  
|------------------------------------------------------------------------------------- | ------------------- | ------------------------------------ | ----- | ---- | ---- | - | ----- | ---- | - | - | ----- | ---- | - | ---- | ----- | ---- | - | - | ----- | ---- | -
|                                                                                      |                     | Fiscal(1)                            |      
|                                                                                      |                     |                                      |      
|                                                                                      |                     | 2001                                 |       |      | 2002 |   |       | 2003 |   |   | 2004  |      |   | 2005 |      
|                                                                                      |                     |                                      |       |      |      |   |       |      |   |   |       |      |   |      |      
|                                                                                      |                     | (In millions, except per share data) |      
|Statement of operations data:                                                         |                     |                                      |       |      |      |   |       |      |   |   |       |      |   |      |       |      |   |   |       |     
|Net sales                                                                             |                     | $                                    | 543.1 |      |      | $ | 577.2 |      |   | $ | 616.1 |      |   | $    | 607.2 |      |   | $ | 643.1 |     
|Cost of sales                                                                         |                     |                                      | 446.6 |      |      |   | 470.9 |      |   |   | 504.0 |      |   |      | 492.5 |      |   |   | 519.4 |     
|Selling, general and administrative                                                   |                     |                                      | 48.1  |      |      |   | 55.3  |      |   |   | 59.6  |      |   |      | 61.5  |      |   |   | 71.4  |     
|Depreciation and amortization                                                         |                     |                                      | 24.5  |      |      |   | 26.2  |      |   |   | 27.1  |      |   |      | 26.6  |      |   |   | 29.3  |     
|Transaction related expenses                                                          |                     |                                      |      |      |      |   | 0.6   |      |   |   | 2.6   |      |   |      |      |      |   |   | 1.0   |     
|Contract related losses                                                               |                     |                                      | 4.8   |      |      |   | 0.7   |      |   |   | 0.8   |      |   |      | 0.4   |      |   |   | 0.4   |     
|                                                                                      |                     |                                      |       |      |      |   |       |      |   |   |       |      |   |      |      
|Operating income                                                                      |                     |                                      | 19.2  |      |      |   | 23.5  |      |   |   | 22.0  |      |   |      | 26.1  |      |   |   | 21.7  |     
|                                                                                      | Interest expense(2) |                                      |       | 23.4 |      |   |       | 20.7 |   |   |       | 32.8 |   |      |       | 25.0 |   |   |       | 31.3 |  
|                                                                                      | Other income, net   |                                      |       | (0.2 | )    |   |       | (1.5 | ) |   |       | (0.1 | ) |      |       | (0.3 | ) |   |       | (1.2 | )
|                                                                                      |                     |                                      |       |      |      |   |       |      |   |   |       |      |   |      |      
|Income (loss) before income taxes                                                     |                     |                                      | (4.0  | )    |      |   | 4.3   |      |   |   | (10.7 | )    |   |      | 1.4   |      |   |   | (8.4  | )   
|Income tax benefit                                                                    |                     |                                      | 0.4   |      |      |   | 0.2   |      |   |   | 6.3   |      |   |      | 1.0   |      |   |   | (3.9  | )   
|                                                                                      |                     |                                      |       |      |      |   |       |      |   |   |       |      |   |      |      
|Net income (loss)(3)                                                                  |                     |                                      | (3.6  | )    |      |   | 4.5   |      |   |   | (4.4  | )    |   |      | 2.3   |      |   |   | (4.6  | )   
|Accretion of conversion options                                                       |                     |                                      |      |      |      |   |      |      |   |   |      |      |   |      | 0.3   |      |   |   |      |     
|                                                                                      |                     |                                      |       |      |      |   |       |      |   |   |       |      |   |      |      
|Net income (loss) available to common stock with or without the
    conversion option |                     | $                                    | (3.6  | )    |      | $ | 4.5   |      |   | $ | (4.4  | )    |   | $    | 2.0   |      |   | $ | (4.6  | )   
|                                                                                      |                     |                                      |       |      |      |   |       |      |   |   |       |      |   |      |      

|                                                           |                              |                                      |       |       |      |   |       |      |  |   |       |       |   |      |       |      |  |   |       |       |  
|---------------------------------------------------------- | ---------------------------- | ------------------------------------ | ----- | ----- | ---- | - | ----- | ---- |  | - | ----- | ----- | - | ---- | ----- | ---- |  | - | ----- | ----- | -
|                                                           |                              | 2001                                 |       |       | 2002 |   |       | 2003 |  |   | 2004  |       |   | 2005 |      
|                                                           |                              |                                      |       |       |      |   |       |      |  |   |       |       |   |      |      
|                                                           |                              | (In millions, except per share data) |      
|Per share data(4):                                         |                              |                                      |       |       |      |   |       |      |  |   |       |       |   |      |       |      |  |   |       |      
|Net income (loss) per share with conversion option:        |                              |                                      |       |       |      |   |       |      |  |   |       |       |   |      |       |      |  |   |       |      
|                                                           | Basic and diluted            |                                      | $     |      |      |   | $     |     |  |   | $     | (0.31 | ) |      | $     | 0.17 |  |   | $     | (0.20 | )
|Net income (loss) per share without conversion option      |                              |                                      |       |       |      |   |       |      |  |   |       |       |   |      |       |      |  |   |       |      
|                                                           | Basic and diluted            |                                      | $     | (0.26 | )    |   | $     | 0.33 |  |   | $     | (0.31 | ) |      | $     | 0.09 |  |   | $     | (0.20 | )
|                                                           | Dividends declared per share |                                      | $     |      |      |   | $     |     |  |   | $     | 0.09  |   |      | $     | 0.79 |  |   | $     | 0.79  |  
|Cash flow data:                                            |                              |                                      |       |       |      |   |       |      |  |   |       |       |   |      |       |      |  |   |       |      
|Net cash provided by operating activities                  |                              | $                                    | 24.7  |       |      | $ | 38.6  |      |  | $ | 27.2  |       |   | $    | 28.4  |      |  | $ | 28.4  |      
|Net cash used in investing activities                      |                              | $                                    | (29.3 | )     |      | $ | (45.0 | )    |  | $ | (45.4 | )     |   | $    | 7.1   |      |  | $ | (24.7 | )    
|Net cash provided by (used in) financing activities        |                              | $                                    | 5.0   |       |      | $ | 1.7   |      |  | $ | 30.8  |       |   | $    | (33.7 | )    |  | $ | 13.0  |      
|Other data:                                                |                              |                                      |       |       |      |   |       |      |  |   |       |       |   |      |       |      |  |   |       |      
|Maintenance capital expenditures(5)                        |                              | $                                    | 12.7  |       |      | $ | 31.2  |      |  | $ | 8.3   |       |   | $    | 18.2  |      |  | $ | 16.7  |      
|Growth capital expenditures(5)                             |                              |                                      | 16.7  |       |      |   | 16.4  |      |  |   | 15.6  |       |   |      | 5.7   |      |  |   | 8.4   |      
|                                                           |                              |                                      |       |       |      |   |       |      |  |   |       |       |   |      |      
|Aggregate capital expenditures(5)                          |                              | $                                    | 29.4  |       |      | $ | 47.6  |      |  | $ | 23.9  |       |   | $    | 23.9  |      |  | $ | 25.1  |      
|Ratio of earnings to fixed charges(6)                      |                              |                                      |      |       |      |   | 1.2   | x    |  |   |      |       |   |      | 1.1   | x    |  |   |      |      
|Deficiency in the coverage of earnings to fixed charges(6) |                              | $                                    | (4.0  | )     |      |   |      |      |  | $ | (10.7 | )     |   |      |      |      |  | $ | (8.4  | )    

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|                                           |  |               |       |  |          |   |       |          |  |   |          |  |  |         |       |  |  |   |       | 
|------------------------------------------ |  | ------------- | ----- |  | -------- | - | ----- | -------- |  | - | -------- |  |  | ------- | ----- |  |  | - | ----- | 
|                                           |  | 1/1/02        |       |  | 12/31/02 |   |       | 12/30/03 |  |   | 12/28/04 |  |  | 1/03/06 |      
|                                           |  |               |       |  |          |   |       |          |  |   |          |  |  |         |      
|                                           |  | (In millions) |      
|Balance sheet data:                        |  |               |       |  |          |   |       |          |  |   |          |  |  |         |       |  |  |   |       | 
|Total assets                               |  | $             | 265.9 |  |          | $ | 280.2 |          |  | $ | 322.3    |  |  | $       | 299.0 |  |  | $ | 318.0 | 
|Long-term debt (including current portion) |  | $             | 224.6 |  |          | $ | 225.4 |          |  | $ | 186.5    |  |  | $       | 170.2 |  |  | $ | 211.9 | 

|                                  |                                                  |               |      |      |      |   |      |      |  |   |       |      |  |      |      |      |  |   |      |      | 
|--------------------------------- | ------------------------------------------------ | ------------- | ---- | ---- | ---- | - | ---- | ---- |  | - | ----- | ---- |  | ---- | ---- | ---- |  | - | ---- | ---- | 
|                                  |                                                  | Fiscal(1)     |     
|                                  |                                                  |               |     
|                                  |                                                  | 2001          |      |      | 2002 |   |      | 2003 |  |   | 2004  |      |  | 2005 |     
|                                  |                                                  |               |      |      |      |   |      |      |  |   |       |      |  |      |     
|                                  |                                                  | (In millions) |     
|EBITDA:                           |                                                  |               |      |      |      |   |      |      |  |   |       |      |  |      |      |      |  |   |      |     
|Net income (loss)(3)              |                                                  | $             | (3.6 | )    |      | $ | 4.5  |      |  | $ | (4.4  | )    |  | $    | 2.3  |      |  | $ | (4.6 | )   
|Income tax benefit                |                                                  |               | 0.4  |      |      |   | 0.2  |      |  |   | 6.3   |      |  |      | 1.0  |      |  |   | 3.9  |     
|                                  |                                                  |               |      |      |      |   |      |      |  |   |       |      |  |      |     
|Income (loss) before income taxes |                                                  | $             | (4.0 | )    |      | $ | 4.3  |      |  | $ | (10.7 | )    |  | $    | 1.4  |      |  | $ | (8.4 | )   
|Adjustments:                      |                                                  |               |      |      |      |   |      |      |  |   |       |      |  |      |      |      |  |   |      |     
|                                  | Interest expense(2)                              |               |      | 23.4 |      |   |      | 20.7 |  |   |       | 32.8 |  |      |      | 25.0 |  |   |      | 31.3 | 
|                                  | Depreciation and amortization                    |               |      | 24.5 |      |   |      | 26.2 |  |   |       | 27.1 |  |      |      | 26.6 |  |   |      | 29.3 | 
|                                  |                                                  |               |      |      |      |   |      |      |  |   |       |      |  |      |     
|EBITDA(7)                         |                                                  | $             | 43.9 |      |      | $ | 51.2 |      |  | $ | 49.2  |      |  | $    | 53.0 |      |  | $ | 52.1 |     
|                                  |                                                  |               |      |      |      |   |      |      |  |   |       |      |  |      |     
|Unusual item included in EBITDA:  |                                                  |               |      |      |      |   |      |      |  |   |       |      |  |      |      |      |  |   |      |     
|                                  | Return of bankruptcy funds to Service America(8) |               |      |     |      |   | $    | 1.4  |  |   |       |     |  |      |      |     |  |   |      |     | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | We have adopted a 52-53 week period ending on the previous
    Tuesday closest to December 31 as our fiscal year. The
    2001, 2002, 2003 and 2004 fiscal years consisted of
    52 weeks, and the 2005 fiscal year consisted of
    53 weeks.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   
|(2) | Interest expense for fiscal 2003 includes a $5.3 million
    non-cash charge related to the early extinguishment of debt as a
    result of the refinancing of our 1998 credit facility and
    $7.2 million in expenses associated with the repurchase of
    the notes that we issued in 1999 (the 1999 notes).
    Interest expense for fiscal 2004 includes a $1.2 million
    non-cash charge related to the repayment of the remaining 1999
    senior subordinated notes and a $2.0 million non-cash
    charge for the change in the fair value of our derivatives.
    Interest expense for fiscal 2005 includes $5.8 million in
    expenses related to entering into a new credit agreement on
    April 1, 2005. The $5.8 million includes a prepayment
    premium of $4.6 million on the prior credit facility and a
    $1.2 million non-cash charge for the write-off of deferred
    financing costs.
|   
|(3) | In accordance with Statement of Financial Accounting Standards
    No. 142, Goodwill and Other Intangible Assets
    or (SFAS 142), effective January 2, 2002, we
    discontinued the amortization of goodwill and trademarks and
    identified intangible assets which we believe have indefinite
    lives. Adjusted net loss to give effect to SFAS 142 would
    have been $1.1 million for fiscal 2001.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   
|(4) | Per share information was adjusted for a 40,920 (rounded to the
    nearest share) for one split of the common stock that was
    effective December 2, 2003.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

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|    |                                                                                                                                                                                                                                                                               
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(5) | The sum of maintenance and growth capital expenditures equals
    the sum of contract rights acquired, (purchase of contract
    rights) and the purchase of property and equipment, for the
    relevant periods as displayed in the statement of cash flows, as
    follows:

|                               |                                                        |               |      |      |      |   |      |      |  |   |      |      |  |      |      |      |  |   |      |      | 
|------------------------------ | ------------------------------------------------------ | ------------- | ---- | ---- | ---- | - | ---- | ---- |  | - | ---- | ---- |  | ---- | ---- | ---- |  | - | ---- | ---- | 
|                               |                                                        | Fiscal(1)     |     
|                               |                                                        |               |     
|                               |                                                        | 2001          |      |      | 2002 |   |      | 2003 |  |   | 2004 |      |  | 2005 |     
|                               |                                                        |               |      |      |      |   |      |      |  |   |      |      |  |      |     
|                               |                                                        | (In millions) |     
|Statement of cash flow data:   |                                                        |               |      |      |      |   |      |      |  |   |      |      |  |      |      |      |  |   |      |     
|                               | Contract rights acquired (purchase of contract rights) |               | $    | 21.3 |      |   | $    | 37.7 |  |   | $    | 16.0 |  |      | $    | 15.9 |  |   | $    | 10.4 | 
|                               | Purchase of property and equipment                     |               |      | 8.1  |      |   |      | 9.9  |  |   |      | 7.9  |  |      |      | 8.0  |  |   |      | 14.7 | 
|                               |                                                        |               |      |      |      |   |      |      |  |   |      |      |  |      |     
|Aggregate capital expenditures |                                                        | $             | 29.4 |      |      | $ | 47.6 |      |  | $ | 23.9 |      |  | $    | 23.9 |      |  | $ | 25.1 |     
|                               |                                                        |               |      |      |      |   |      |      |  |   |      |      |  |      |     



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Maintenance capital expenditures are capital expenditures made
    to secure renewals of our existing contracts and maintain these
    contracts following renewal. Growth capital expenditures are
    those made to secure new contracts and maintain these contracts
    during their initial term. Accordingly, growth capital
    expenditures in any given year consist of up-front capital
    investments in new contracts and additional committed
    investments in existing contracts that have never previously
    been renewed.                                                                                                                                                                                                                                                                  
|
| | From year to year, our aggregate capital expenditures can vary
    considerably. This is because (a) the pattern of renewals
    (which may give rise to maintenance capital expenditures) varies
    based on the term of existing contracts, and (b) our
    pattern of obtaining new contracts (which may give rise to
    growth capital expenditures) varies over time.                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| | We believe that the identification and separation of maintenance
    and growth capital expenditures are important factors in
    evaluating our financial results. While we strive to maintain
    our present level of EBITDA by securing renewals of our existing
    contracts, we cannot be assured that we will maintain our
    present level of EBITDA in part because we cannot predict the
    future financial requirements of our clients. Contracts may be
    renewed at significantly different commission rates and, thus,
    significantly different levels of EBITDA, depending on the
    clients financial requirements at the time of renewal. See
    Managements Discussion and Analysis of Financial
    Condition and Results of Operations  Liquidity and
    Capital Resources.



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(6) | For purposes of determining the ratio of earnings to fixed
    charges, earnings are defined as income (loss) before income
    taxes and cumulative effect of change in accounting principle
    plus fixed charges. Fixed charges include interest expense on
    all indebtedness, amortization of deferred financing costs and
    one-third of rental expense on operating leases representing
    that portion of rental expense deemed to be attributable to
    interest. Where earnings are inadequate to cover fixed charges,
    the deficiency is reported.
|   
|(7) | EBITDA is not a measure in accordance with GAAP. EBITDA is not
    intended to represent cash flows from operations as determined
    by GAAP and should not be used as an alternative to income
    (loss) before taxes or net income (loss) as an indicator of
    operating performance or to cash flows as a measure of
    liquidity. We believe that EBITDA is an important measure of the
    cash returned on our investment in capital expenditures under
    our contracts.                                                                                  



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Adjusted EBITDA, as defined in the indenture
    governing our 13.50% Subordinated Notes issued in 2003,
    which we refer to as the subordinated notes, is
    determined as EBITDA, as adjusted for transaction related
    expenses, contract related losses, other non-cash charges, and
    the annual management fee paid to affiliates of Blackstone and
    GE Capital through 2003, less any non-cash credits. We present
    this discussion of Adjusted EBITDA because covenants in the
    indenture governing our subordinated notes contain ratios based
    on this measure. For example, our ability to incur additional
    debt and make restricted payments requires a ratio of Adjusted
    EBITDA to fixed charges of 2.0 to 1.0, calculated on a pro
    formabasis in accordance with the indenture, except that we
    may incur certain debt and make certain restricted payments
    without regard to the ratio, and may incur an unlimited amount
    of indebtedness in connection with the issuance of additional
    IDSs so long

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| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | as the ratio of the aggregate principal amount of the additional
    notes to the number of the additional shares of our common stock
    will not exceed the equivalent ratio represented by the then
    existing IDSs. In fiscal 2005, the ratio of Adjusted EBITDA to
    fixed charges was 1.9 to 1.0 as a result of the additional
    interest expense associated with the refinancing of the senior
    credit facility. This additional interest expense was excluded
    from the pro formacalculation of the ratio under the
    indenture in accordance with the provisions of the indenture
    governing the incurrence of indebtedness. As of January 3,
    2006, we are in compliance with the ratio requirements and have
    the ability to incur additional indebtedness.
|
| | On a historical basis, we made the following adjustments to
    EBITDA to compute Adjusted EBITDA:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

|                                          |                                                                      |                              |      |     |      |   |      |      |  |   |      |     |  |      |      |     |  |   |      |     | 
|----------------------------------------- | -------------------------------------------------------------------- | ---------------------------- | ---- | --- | ---- | - | ---- | ---- |  | - | ---- | --- |  | ---- | ---- | --- |  | - | ---- | --- | 
|                                          |                                                                      | Fiscal(1)                    |     
|                                          |                                                                      |                              |     
|                                          |                                                                      | 2001                         |      |     | 2002 |   |      | 2003 |  |   | 2004 |     |  | 2005 |     
|                                          |                                                                      |                              |      |     |      |   |      |      |  |   |      |     |  |      |     
|                                          |                                                                      | (In millions, except ratios) |     
|EBITDA                                    |                                                                      | $                            | 43.9 |     |      | $ | 51.2 |      |  | $ | 49.2 |     |  | $    | 53.0 |     |  | $ | 52.1 |    
|Adjustments:                              |                                                                      |                              |      |     |      |   |      |      |  |   |      |     |  |      |      |     |  |   |      |    
|                                          | Transaction related expenses                                         |                              |      |    |      |   |      | 0.6  |  |   |      | 2.6 |  |      |      |    |  |   |      | 1.0 | 
|                                          | Contract related losses                                              |                              |      | 4.8 |      |   |      | 0.7  |  |   |      | 0.8 |  |      |      | 0.4 |  |   |      | 0.4 | 
|                                          | Non-cash compensation                                                |                              |      | 0.1 |      |   |      | 0.6  |  |   |      | 0.1 |  |      |      |    |  |   |      |    | 
|                                          | Management fees paid to affiliates of Blackstone and GE Capital      |                              |      | 0.4 |      |   |      | 0.4  |  |   |      | 0.4 |  |      |      |    |  |   |      |    | 
|                                          |                                                                      |                              |      |     |      |   |      |      |  |   |      |     |  |      |     
|Adjusted EBITDA                           |                                                                      | $                            | 49.2 |     |      | $ | 53.5 |      |  | $ | 53.1 |     |  | $    | 53.4 |     |  | $ | 53.5 |    
|                                          |                                                                      |                              |      |     |      |   |      |      |  |   |      |     |  |      |     
|                                          | Unusual item included in EBITDA and Adjusted EBITDA:                 |                              |      |     |      |   |      |      |  |   |      |     |  |      |      |     |  |   |      |     | 
|                                          | Return of bankruptcy funds to Service America (see note 8
    below) |                              |      |    |      |   |      | 1.4  |  |   |      |    |  |      |      |    |  |   |      |    | 
|Ratio of Adjusted EBITDA to fixed charges |                                                                      |                              | 2.2  | x   |      |   | 2.8  | x    |  |   | 2.1  | x   |  |      | 2.3  | x   |  |   | 1.9x |    





| |   |                                      
| | - | -------------------------------------
| |  | Transaction related expenses include:



| |   |                                                                                                                                                                                                                    
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | For fiscal 2002, $0.6 million of acquisition related cash
    costs relating primarily to expenses incurred in connection with
    the structuring and evaluation of financing and recapitalization
    strategies;
|
| |  | For fiscal 2003, $2.6 million in expenses related to
    executive compensation associated with the issuance of the
    IDSs; and                                                                                  
|
| |  | For fiscal 2005, $1.0 million of expenses incurred in
    connection with the contemplated follow-on offering to the 2003
    IPO.                                                                                 



| |   |                                 
| | - | --------------------------------
| |  | Contract related losses include:



| |   |                                                                                                                                                                                                                                                                            
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | For fiscal 2001, $4.8 million of non-cash charges related
    to the write-down of impaired assets for certain contracts where
    the estimated future cash flows from the contract were
    insufficient to cover the carrying cost of the related
    long-lived assets;
|
| |  | For fiscal 2002, $0.7 million of non-cash charges related
    to the write-down of impaired assets for a contract which was
    terminated;                                                                                                                                
|
| |  | For fiscal 2003, $0.8 million of non-cash charges for the
    write-down of impaired assets for certain terminated and/or
    assigned contracts;                                                                                                                          
|
| |  | For fiscal 2004, $0.4 million of non-cash charges for the
    write-down of impaired assets for certain terminated contracts
    and contracts for which we intend to continue
    operations; and                                                                         

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| |   |                                                                                                                                                                                                     
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | For fiscal 2005, $0.3 million for the write-off of contract
    rights for a terminated contract and $0.1 million for the
    write-down of impaired contract rights and property and
    equipment.



| |   |                                                                                                                                                                                                                                                                                               
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Non-cash compensation expenses related to the revaluation of
    partnership units purchased by certain members of our management
    financed with nonrecourse loans include for fiscal 2001, 2002
    and 2003, $0.3 million, $0.1 million,
    $0.6 million and $0.1 million, respectively.
|
| |  | Management fees paid to affiliates of Blackstone and GE Capital
    include $0.4 million for each of fiscal 2001, 2002 and
    2003. The management fees were paid quarterly in arrears and
    ceased upon the closing of the IPO.                                                           



| |                                                                                                                                                                                                                                                                                                                              
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | For purposes of calculating the ratio of Adjusted EBITDA to
    fixed charges, fixed charges includes interest expense
    (excluding amortization of deferred financing fees) plus
    capitalized interest, the earned discount or yield with respect
    to the sale of receivables and cash dividends on preferred stock.



|    |                                                                                                                                                                                            
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(8) | During fiscal 2002, Service America received approximately
    $1.4 million from funds previously set aside to satisfy
    creditors pursuant to a plan of reorganization approved in 1993.






|        |                                                                                          
|------- | -----------------------------------------------------------------------------------------
|Item 7. | Managements Discussion and Analysis of Financial
    Condition and Results of Operations

General




Overview










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Critical Accounting Policies






| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Recoverability of Property and Equipment, Contract Rights,
    Cost in Excess of Net Assets Acquired and Other Intangible
    Assets. As of January 3, 2006, net property and
    equipment of $49.7 million and net contract rights of
    $80.6 million were recorded. In accordance with Statement
    of Financial Accounting Standards (SFAS)
    No. 144, we evaluate long-lived assets with definite lives
    for possible impairment when an event occurs which would
    indicate that its carrying amount may not be recoverable. The
    impairment analysis is made at the contract level and evaluates
    the net property and equipment as well as the contract rights
    related to that contract. The undiscounted future cash flows
    from a contract are compared to the carrying value of the
    related long-lived assets. If the undiscounted future cash flows
    are lower than the carrying value, an impairment charge is
    recorded. The amount of the impairment charge is equal to the
    difference between the balance of the long- lived assets and the
    future discounted cash flows related to the assets (using a rate
    based on our incremental borrowing rate). As we base our
    estimates of undiscounted future cash flows on past operating
    performance, including anticipated labor and other cost
    increases, and prevailing market conditions, we cannot make
    assurances that our estimates are achievable. Different
    conditions or assumptions, if significantly negative or
    unfavorable, could have a material adverse effect on the outcome
    of our evaluation and our financial condition or future results
    of operations. Events that would trigger an evaluation at the
    contract level include the loss of a tenant team, intent to
    cease operations at a facility due to contract termination or
    other means, the bankruptcy of a client, discontinuation of a
    sports league or a significant increase in competition that
    could reduce the future profitability of the contract, among
    others. As of January 3, 2006, cost in excess of net assets
    acquired of $41.1 million and other intangible assets
    (trademarks) of $17.5 million were recorded. In
    accordance with SFAS No. 142, on an annual basis, we
    test our indefinite-lived intangible assets (cost in excess of
    net assets acquired and trademarks) for impairment.
    Additionally, cost in excess of net assets acquired is tested
    between annual tests if an event occurs or circumstances change
    that would more likely than not reduce the fair value of a
    reporting unit below its carrying amount. We have determined
    that the reporting unit for testing the cost in excess of net
    assets acquired for impairment is Centerplate. In performing the
    annual cost in excess of net assets acquired assessment, we
    compare the fair value of Centerplate to its net asset carrying
    amount, including cost in excess of net assets acquired and
    trademarks. If the fair value of Centerplate exceeds the
    carrying amount, then it is determined that cost in excess of
    net assets acquired is not impaired. Should the carrying amount
    exceed the fair value, then we would need to perform the second
    step in the impairment test to determine the amount of the cost
    in excess of net assets acquired write-off. Fair value for these
    tests is determined based upon a discounted cash flow model,
    using a rate based on our incremental borrowing rate. As we base
    our estimates of cash flows on past operating performance,
    including anticipated labor and other cost increases and
    prevailing market conditions, we cannot make assurances that our
    estimates are achievable. Different conditions or assumptions,
    if significantly negative or unfavorable, could have a material
    adverse effect on the outcome of our evaluation and on our
    financial condition or future results of operations. In
    performing the annual trademark assessment, management compares
    the fair value of the intangible asset to its carrying value.
    Fair value is determined based on a discounted cash flow model,
    using a rate based on our incremental borrowing rate. If the
    carrying a mount of the intangible asset exceeds its fair value,
    an impairment loss will be recognized for the excess amount. If
    the fair value is greater than the carrying amount, no further

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| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   | assessment is performed. We performed our annual assessments of
    cost in excess of net assets acquired and trademarks on
    March 29, 2005 and determined that no impairment exists.
    Additionally, no factors were noted since March 29, 2005
    that would cause us to re-evaluate this assessment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| |  | Insurance. We have a high-deductible insurance program
    for general liability, auto liability and workers
    compensation risk. We are required to estimate and accrue for
    the amount of losses that we expect to incur. These amounts are
    recorded in cost of sales and selling, general and
    administrative expenses on the statement of operations and
    accrued liabilities and long-term liabilities on the balance
    sheet. Our estimates consider a number of factors, including
    historical experience and an actuarial assessment of the
    liabilities for reported claims and claims incurred but not
    reported. We discount our estimated liabilities to their present
    value based on expected loss patterns determined by experience.
    While we use outside parties to assist us in making these
    estimates, we cannot provide assurance that the actual amounts
    will not be materially different than what we have recorded. In
    addition we are self-insured for employee medical benefits and
    related liabilities. Our liabilities are based on historical
    trends and claims filed and are estimated for claims incurred
    but not reported. While the liabilities represent
    managements best estimate, actual results could differ
    significantly from those estimates.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|
| |  | Accounting Treatment for IDSs, Common Stock Owned by Initial
    Equity Investors and Derivative Financial Instruments. Our
    IDSs include common stock and subordinated notes, the latter of
    which have three embedded derivative features. The embedded
    derivative features include a call option, a change of control
    put option, and a term-extending option on the notes. The call
    option allows us to repay the principal amount of the
    subordinated notes after the fifth anniversary of the issuance,
    provided that we also pay all of the interest that would have
    been paid during the initial
    10-year term of the
    notes, discounted to the date of repayment at a risk-free rate.
    Under the change of control put option, the holders have the
    right to cause us to repay the subordinated notes at 101% of
    face value upon a change of control, as defined in the
    subordinated note agreement. The term-extending option allows us
    to unilaterally extend the term of the subordinated notes for
    two five-year periods at the end of the initial
    10-year period provided
    that we are in compliance with the requirements of the
    indenture. We have accounted for these embedded derivatives in
    accordance with SFAS No. 133, Accounting for
    Derivative Instruments and Hedging Activities, as amended
    and interpreted. Based on SFAS No. 133, as amended and
    interpreted, the call option and the change of control put
    option are required to be separately valued. As of
    January 3, 2006, these embedded derivatives were fair
    valued and determined to be insignificant. The term extending
    option was determined to be inseparable from the underlying
    subordinated notes. Accordingly, it will not be separately
    accounted for in the current or future periods.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | In connection with the IPO, those investors who held stock prior
    to the IPO (the Initial Equity Investors) entered
    into an amended and restated stockholders agreement, which
    provides that, upon any post-offering sale of common stock by
    the Initial Equity Investors, at the option of the Initial
    Equity Investors, we will exchange a portion of their common
    stock for subordinated notes at an exchange rate of $9.30
    principal amount of subordinated notes for each share of common
    stock (so that, after such exchange, the Initial Equity
    Investors will have shares of common stock and subordinated
    notes in the appropriate proportions to represent integral
    numbers of IDSs). In order to determine the number of shares of
    common stock that the Initial Equity Investors could convert
    into subordinated debt, we divided the exchange rate of $9.30 by
    the original issue price of the IDSs of $15.00 at
    December 4, 2003 (the quotient equals 0.62). This quotient
    was then multiplied by the total number of shares owned by the
    Initial Equity Investors (4,060,997 shares) to determine
    the number of IDSs that the Initial Equity Investors would own
    after conversion (2,517,817 IDSs, each comprised of one share of
    stock and a subordinated note). The number of shares owned by
    the Initial Equity Investors before conversion (4,060,997) was
    subtracted from the number of shares they would own after
    conversion (2,517,817) to determine the number of shares of
    common stock to be converted into subordinated debt
    (1,543,180 shares) at the exchange rate of $9.30 per
    share resulting in approximately $14.4 million as described
    further below.

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| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We have concluded that the portion of the Initial Equity
    Investors common stock exchangeable for subordinated debt,
    as calculated above, should be classified on its consolidated
    balance sheet according to the guidance provided by Accounting
    Series Release No. 268 (FRR Section 211),
    Redeemable Preferred Stocks. Accordingly, at
    January 3, 2006 we have recorded approximately
    $14.4 million as Common stock with conversion option
    exchangeable for subordinated debt on the balance sheet.
    Because the Initial Equity Investors were not allowed to convert
    any shares into subordinated notes during the first
    180 days after the IPO, a discount (initially
    $0.4 million) was applied to the amount recorded as
    Common stock with conversion option exchangeable for
    subordinated debt during this 180 day period. This
    discount was accreted to the face amount due of approximately
    $14.4 million using the effective interest method over the
    life of the Initial Equity Investors minimum required
    180-day holding period.
    The accretion of approximately $317,000 in fiscal 2004 was a
    deemed dividend to the Initial Equity Investors. In addition, we
    have determined that the option conveyed to the Initial Equity
    Investors to exchange common stock for subordinated debt in
    order to form IDSs is an embedded derivative in accordance
    with SFAS No. 133. Centerplate has recorded a
    liability for the fair value of this embedded derivative of
    approximately $4.6 million as of January 3, 2006, a
    decrease of $0.04 million from December 28, 2004. This
    option is fair-valued each reporting period with the change in
    the fair value recorded in interest expense in the accompanying
    consolidated statement of operations.
|
| | The common stock held by the Initial Equity Investors has been
    treated as a separate class of common stock for presentation of
    earnings per share at January 3, 2006. Although the common
    stock held by the Initial Equity Investors is part of the same
    class of stock as the common stock included in the IDSs for
    purposes of Delaware corporate law, the right to convert that is
    granted in our amended and restated stockholders agreement as
    described above causes the stock held by the Initial Equity
    Investors to have features of a separate class of stock for
    accounting purposes. In fiscal 2004, the deemed dividend of
    approximately $317,000 conveyed to the Initial Equity Investors
    discussed above requires a two class earnings per share
    calculation. Accordingly, at January 3, 2006, Centerplate
    has shown separate earnings per share for the stock held by the
    Initial Equity Investors and the stock included in the IDSs.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        



| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Deferred Income Taxes. We recognize deferred tax assets
    and liabilities based on the expected future tax consequences of
    temporary differences between the carrying amounts and the tax
    basis of assets and liabilities and the future tax benefits of
    net operating loss carryforwards and tax credits. Our primary
    deferred tax assets relate to net operating losses and credit
    carryovers. The realization of these deferred tax assets depends
    upon our ability to generate future taxable income. If our
    results of operations are adversely affected and we do not
    generate taxable income, not all of our deferred tax assets, if
    any, may be realized.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We accounted for the issuance of IDS units in December 2003 by
    allocating the proceeds for each IDS unit to the underlying
    stock and subordinated notes based upon the relative fair values
    of each at that time. Accordingly, the portion of the aggregate
    IDSs outstanding that represents subordinated notes has been
    accounted for as long-term debt bearing a stated interest rate
    of 13.5% maturing on December 10, 2013. There can be no
    assurances that the Internal Revenue Service or the courts will
    not seek to challenge the treatment of these notes as debt or
    the amount of interest expense deducted, although to date we
    have not been notified that the notes should be treated as
    equity rather than debt for U.S. federal and state income
    tax purposes. Such reclassification would result in an
    additional tax liability and cause Centerplate to utilize at a
    faster rate more of its deferred tax assets than it otherwise
    would.

Seasonality and Quarterly Results






| |   |                                                                           
| | - | --------------------------------------------------------------------------
| |  | Seasonality and variations in scheduling of sporting and other
    events;
|
| |  | Unpredictability in the number, timing and type of new contracts;         

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| |   |                                                       
| | - | ------------------------------------------------------
| |  | Timing of contract expirations and special events; and
|
| |  | Level of attendance at the facilities which we serve. 







|            |  |           |         |           |        |   |            |          |                |        |        |                  |                  |           |        |            |        |   |       |   |  |   |       |  
|----------- |  | --------- | ------- | --------- | ------ | - | ---------- | -------- | -------------- | ------ | ------ | ---------------- | ---------------- | --------- | ------ | ---------- | ------ | - | ----- | - |  | - | ----- | -
|            |  | 2005      |        
|            |  |           |        
|            |  |           |         | Basic and |        |   |            |          | Basic and      |       
|            |  |           |         | Diluted   |        |   |            |          | Basic and      |        |        | Diluted Income   |                 
|            |  |           |         | Operating |        |   |            |          | Diluted Income |        |        | (Loss) per Share |                 
|            |  |           |         | Operating |        |   | Income     |          |                | Net    |        |                  | (Loss) per Share |           |        | without    |       
|            |  |           |         | Income    |        |   | (Loss) per |          |                | Income |        |                  | with Conversion  |           |        | Conversion |       
|            |  | Net Sales |         |           | (Loss) |   |            | Share(1) |                |        | (Loss) |                  |                  | Option(1) |        |            | Option |  
|            |  |           |         |           |        |   |            |          |                |        |        |                  |                  |           |        |            |        |  
|1st Quarter |  | $         | 107,220 |           |        | $ | (4,382     | )        |                | $      | (0.19  | )                |                  | $         | (4,433 | )          |        | $ | (0.20 | ) |  | $ | (0.20 | )
|2nd Quarter |  | $         | 182,071 |           |        | $ | 10,481     |          |                | $      | 0.47   |                  |                  | $         | (2,473 | )          |        | $ | (0.11 | ) |  | $ | (0.11 | )
|3rd Quarter |  | $         | 208,619 |           |        | $ | 14,972     |          |                | $      | 0.66   |                  |                  | $         | 4,512  |            |        | $ | 0.20  |   |  | $ | 0.20  |  
|4th Quarter |  | $         | 145,202 |           |        | $ | 611        |          |                | $      | 0.03   |                  |                  | $         | (2,194 | )          |        | $ | (0.10 | ) |  | $ | (0.10 | )

|            |  |           |         |           |        |   |            |          |                |        |        |                  |                  |           |        |            |        |   |       |   |  |   |       |  
|----------- |  | --------- | ------- | --------- | ------ | - | ---------- | -------- | -------------- | ------ | ------ | ---------------- | ---------------- | --------- | ------ | ---------- | ------ | - | ----- | - |  | - | ----- | -
|            |  | 2004      |        
|            |  |           |        
|            |  |           |         | Basic and |        |   |            |          | Basic and      |       
|            |  |           |         | Diluted   |        |   |            |          | Basic and      |        |        | Diluted Income   |                 
|            |  |           |         | Operating |        |   |            |          | Diluted Income |        |        | (Loss) per Share |                 
|            |  |           |         | Operating |        |   | Income     |          |                | Net    |        |                  | (Loss) per Share |           |        | without    |       
|            |  |           |         | Income    |        |   | (Loss) per |          |                | Income |        |                  | with Conversion  |           |        | Conversion |       
|            |  | Net Sales |         |           | (Loss) |   |            | Share(1) |                |        | (Loss) |                  |                  | Option(1) |        |            | Option |  
|            |  |           |         |           |        |   |            |          |                |        |        |                  |                  |           |        |            |        |  
|1st Quarter |  | $         | 98,236  |           |        | $ | (4,336     | )        |                | $      | (0.19  | )                |                  | $         | (9,177 | )          |        | $ | (0.37 | ) |  | $ | (0.42 | )
|2nd Quarter |  | $         | 173,725 |           |        | $ | 10,861     |          |                | $      | 0.48   |                  |                  | $         | 5,394  |            |        | $ | 0.27  |   |  | $ | 0.23  |  
|3rd Quarter |  | $         | 201,066 |           |        | $ | 14,963     |          |                | $      | 0.66   |                  |                  | $         | 5,733  |            |        | $ | 0.25  |   |  | $ | 0.25  |  
|4th Quarter |  | $         | 134,127 |           |        | $ | 4,609      |          |                | $      | 0.20   |                  |                  | $         | 370    |            |        | $ | 0.02  |   |  | $ | 0.02  |  

|            |  |           |         |           |        |   |            |          |           |        |        |   |                |          |         |   |  |   |       |  
|----------- |  | --------- | ------- | --------- | ------ | - | ---------- | -------- | --------- | ------ | ------ | - | -------------- | -------- | ------- | - |  | - | ----- | -
|            |  | 2003      |        
|            |  |           |        
|            |  |           |         | Basic and |        |   |           
|            |  |           |         | Diluted   |        |   |           
|            |  |           |         | Operating |        |   |            |          | Basic and |       
|            |  |           |         | Operating |        |   | Income     |          |           | Net    |        |   | Diluted Income |         
|            |  |           |         | Income    |        |   | (Loss) per |          |           | Income |        |   | (Loss) per     |         
|            |  | Net Sales |         |           | (Loss) |   |            | Share(1) |           |        | (Loss) |   |                | Share(1) |        
|            |  |           |         |           |        |   |            |          |           |        |        |   |                |          |        
|1st Quarter |  | $         | 96,900  |           |        | $ | (4,715     | )        |           | $      | (0.35  | ) |                | $        | (6,545  | ) |  | $ | (0.48 | )
|2nd Quarter |  | $         | 172,733 |           |        | $ | 10,460     |          |           | $      | 0.77   |   |                | $        | 2,876   |   |  | $ | 0.21  |  
|3rd Quarter |  | $         | 214,636 |           |        | $ | 16,583     |          |           | $      | 1.22   |   |                | $        | 10,674  |   |  | $ | 0.78  |  
|4th Quarter |  | $         | 131,788 |           |        | $ | (375       | )        |           | $      | (0.02  | ) |                | $        | (11,423 | ) |  | $ | (0.70 | )






|    |                                                                                                                                                                                                                                 
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The basic and diluted operating income (loss) and basic and
    diluted income (loss) per share reflect a 40,920 (rounded to the
    nearest share) for one split of the common stock that was
    effected on December 2, 2003.

Results of Operations




| |                                    
| | -----------------------------------
| | Fiscal 2005 Compared to Fiscal 2004

Net sales


40



---



##### Table of Contents





Cost of sales


Selling, general and administrative expenses


Depreciation and amortization


Transaction related expenses


Contract related losses


Operating income


Interest expense


41



---



##### Table of Contents





Other income, net


Income taxes Accounting
for Income Taxes.




| |                                    
| | -----------------------------------
| | Fiscal 2004 Compared to Fiscal 2003

Net sales


Cost of sales


Selling, general and administrative expenses


Depreciation and amortization


Transaction related expenses


42



---



##### Table of Contents



Contract related losses write-off


Operating income


Interest expense


Other income, net


Income taxes




| |        
| | -------
| | Outlook

10-K,




43



---



##### Table of Contents





Liquidity and Capital Resources












44



---



##### Table of Contents













|                       |       |  |      |   |      |      |  |   |      |  |  |                |      |  |  |   |       | 
|---------------------- | ----- |  | ---- | - | ---- | ---- |  | - | ---- |  |  | -------------- | ---- |  |  | - | ----- | 
|Contracts Expiring in: |      
|                       |      
|2006                   |       |  | 2007 |   |      | 2008 |  |   | 2009 |  |  | 2010 and After |     
|                       |       |  |      |   |      |      |  |   |      |  |  |                |     
|(In millions)          |      
|$                      | 154.9 |  |      | $ | 94.2 |      |  | $ | 59.5 |  |  | $              | 73.5 |  |  | $ | 249.8 | 









| |                                  
| | ---------------------------------
| | Subordinated Notes Issued in 2003



45



---



##### Table of Contents







| |                      
| | ---------------------
| | 2005 Credit Agreement











| |   |                                                                                                                                                                                     
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | an interest coverage ratio (Adjusted EBITDA to cash interest
    expense for the last 12 months) at least equal to 2.05 to
    1.00 through fiscal 2006 and 2.00 to 1.00 thereafter;

46



---



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| |   |                                                                                                                                                                                                                        
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | a maximum total leverage ratio (net debt as of the date of
    determination to Adjusted EBITDA for the 12 months ending
    on such date) of 4.65 to 1.00; and                                                        
|
| |  | a maximum senior leverage ratio (net senior debt as of the date
    of determination to Adjusted EBITDA for the 12 months
    ending on such date) of 2.25 to 1.00 through fiscal 2006 and
    2.15 to 1.00 thereafter.



out-of




Other Relationships




Contractual Commitments




|                                   |  |                        |       |           |        |   |      |       |  |     |       |  |           |         |       |  |  |   |       | 
|---------------------------------- |  | ---------------------- | ----- | --------- | ------ | - | ---- | ----- |  | --- | ----- |  | --------- | ------- | ----- |  |  | - | ----- | 
|                                   |  | Payments Due by Period |      
|                                   |  |                        |      
|                                   |  |                        |       | Less Than |        |   | 1-3  |       |  | 4-5 |       |  | More Than |        
|                                   |  | Total                  |       |           | 1 Year |   |      | Years |  |     | Years |  |           | 5 Years |      
|                                   |  |                        |       |           |        |   |      |       |  |     |       |  |           |         |      
|                                   |  | (In millions)          |      
|Long-term borrowings               |  | $                      | 211.9 |           |        | $ | 1.1  |       |  | $   | 3.2   |  |           | $       | 102.4 |  |  | $ | 105.2 | 
|Interest for fixed rate debt       |  |                        | 112.7 |           |        |   | 14.2 |       |  |     | 42.6  |  |           |         | 28.4  |  |  |   | 27.5  | 
|Interest for variable rate debt(1) |  |                        | 42.4  |           |        |   | 8.8  |       |  |     | 26.9  |  |           |         | 6.7   |  |  |   |      | 
|Insurance                          |  |                        | 12.6  |           |        |   | 6.7  |       |  |     | 4.9   |  |           |         | 0.7   |  |  |   | 0.3   | 
|Operating leases                   |  |                        | 1.6   |           |        |   | 0.8  |       |  |     | 0.8   |  |           |         |      |  |  |   |      | 
|Commissions and royalties          |  |                        | 47.7  |           |        |   | 8.4  |       |  |     | 17.2  |  |           |         | 7.5   |  |  |   | 14.6  | 
|Capital Commitments(2)             |  |                        | 11.2  |           |        |   | 10.2 |       |  |     | 1.0   |  |           |         |      |  |  |   |      | 
|Other long-term liabilities(3)     |  |                        | 0.5   |           |        |   | 0.1  |       |  |     | 0.4   |  |           |         |      |  |  |   |      | 
|                                   |  |                        |       |           |        |   |      |       |  |     |       |  |           |         |      
|Total Contractual                  |  | $                      | 440.6 |           |        | $ | 50.3 |       |  | $   | 97.0  |  |           | $       | 145.7 |  |  | $ | 147.6 | 
|                                   |  |                        |       |           |        |   |      |       |  |     |       |  |           |         |      






|    |                                                                                                     
|--- | ----------------------------------------------------------------------------------------------------
|(1) | Interest for variable rate debt based on forward-looking
    interest rates as disclosed in Item 7A.
|   
|(2) | Represents capital commitments in connection with several
    long-term concession contracts.       

47



---



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|    |                                                                             
|--- | ----------------------------------------------------------------------------
|(3) | Represents various long-term obligations reflected on the
    balance sheet.



|                             |  |                        |  |           |      |  |       |   |       |  |           |   |   |  |  |   |   | 
|---------------------------- |  | ---------------------- |  | --------- | ---- |  | ----- | - | ----- |  | --------- | - | - |  |  | - | - | 
|                             |  | Payments Due by Period
|                             |  |                       
|                             |  |                        |  | Less Than |      |  | 1-3   |   | 4-5   |  | More Than
|Other Commercial Commitments |  | Total                  |  | 1 Year    |      |  | Years |   | Years |  | 5 Years  
|                             |  |                        |  |           |      |  |       |   |       |  |          
|Letters of credit            |  | $20.9                  |  | $         | 20.9 |  |       | $ |      |  |           | $ |  |  |  | $ |  | 

Hurricane Katrina




New Accounting Standards


Share-Based Payment


Accounting for Conditional Asset Retirement
Obligations


Cautionary Statement Regarding Forward-Looking Statements


10-K


10-K.


48



---



##### Table of Contents










|         |                                                               
|-------- | --------------------------------------------------------------
|Item 7A. | Quantitative and Qualitative Disclosures About Market
    Risk

Interest rate risk


|                    |                     |                       |   |     |      |   |   |      |     |   |      |     |     |      |   |     |            |   |   |       |     |   |   |       |      |   |   |       |   | 
|------------------- | ------------------- | --------------------- | - | --- | ---- | - | - | ---- | --- | - | ---- | --- | --- | ---- | - | --- | ---------- | - | - | ----- | --- | - | - | ----- | ---- | - | - | ----- | - | 
|                    |                     | 2006                  |   |     | 2007 |   |   | 2008 |     |   | 2009 |     |     | 2010 |   |     | Thereafter |   |   | Total |    
|                    |                     |                       |   |     |      |   |   |      |     |   |      |     |     |      |   |     |            |   |   |       |    
|                    |                     | (In millions)         |  
|Fixed rate debt:    |                     |                       |   |     |      |   |   |      |     |   |      |     |     |      |   |     |            |   |   |       |     |   |   |       |      |   |   |      
|                    | Represented by IDSs |                       |   |    |      |   |   |     |     |   |      |    |     |      |   |    |            |   |   |      |     |   | $ | 105.2 |      |   | $ | 105.2 |  
|                    |                     | Average interest rate |   |     |     |   |   |      |    |   |      |     |    |      |   |     |           |   |   |       |    |   |   |       | 13.5 | % |   |       |  | 
|Variable rate debt: |                     |                       |   |     |      |   |   |      |     |   |      |     |     |      |   |     |            |   |   |       |     |   |   |       |      |   |   |      
|                    | Term loans          |                       | $ | 1.1 |      |   | $ | 1.1  |     |   | $    | 1.1 |     |      | $ | 1.1 |            |   | $ | 102.3 |     |   |   |      |      |   | $ | 106.7 |  
|                    |                     | Average interest rate |   |     | 8.29 | % |   |      | 8.4 | % |      |     | 8.4 | %    |   |     | 8.4        | % |   |       | 8.4 | % |   |       |     |   |   |       |  | 



Market risk


10-K


49



---



##### Table of Contents








|        |                                            
|------- | -------------------------------------------
|Item 8. | Financial Statements and Supplementary Data

CENTERPLATE, INC.


Index to Consolidated Financial Statements


|                                                                                                                                                   |  |      |     | 
|-------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---- | --- | 
|                                                                                                                                                   |  | Page |    
|                                                                                                                                                   |  |      |    
|REPORT OF INDEPENDENT REGISTERED PUBLIC
    ACCOUNTING FIRM                                                                                        |  |      | F-2 | 
|CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 28, 2004
    AND JANUARY 3, 2006 AND FOR THE THREE YEARS IN THE PERIOD
    ENDED JANUARY 3, 2006: |  |      |     | 
|Consolidated Balance Sheets                                                                                                                        |  |      | F-3 | 
|Consolidated Statements of Operations                                                                                                              |  |      | F-4 | 
|Consolidated Statements of
    Stockholders Equity (Deficiency) and Comprehensive Income
    (Loss)                                               |  |      | F-5 | 
|Consolidated Statements of Cash Flows                                                                                                              |  |      | F-6 | 
|Notes to Consolidated Financial
    Statements                                                                                                     |  |      | F-7 | 

F-1



---



##### Table of Contents






REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM














Internal Control 
Integrated Framework








F-2



---



##### Table of Contents



CENTERPLATE, INC.





CONSOLIDATED BALANCE SHEETS


DECEMBER 28, 2004 AND JANUARY 3, 2006


|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |        |         |          |   |        |         | 
|------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------- | ------------------------------------------- | ---------------------------- | ---------- | ------ | ------- | -------- | - | ------ | ------- | 
|                                                                                                              |                                                                                                                                             | December 28,                                                          |                                             |                              | January 3, |       
|                                                                                                              |                                                                                                                                             | 2004                                                                  |                                             |                              | 2006       |       
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       
|                                                                                                              |                                                                                                                                             | (In thousands, except                                                 |                                            
|                                                                                                              |                                                                                                                                             | share data)                                                           |                                            
|ASSETS                                                                                                       
|CURRENT ASSETS:                                                                                               |                                                                                                                                             |                                                                       |                                             |                              |            |        |         |         
|                                                                                                              | Cash and cash equivalents                                                                                                                   |                                                                       | $                                           | 24,777                       |            |        | $       | 41,410   |  
|                                                                                                              | Accounts receivable, less allowance for doubtful accounts of
    $495 and $1,049 at December 28, 2004 and January 3,
    2006, respectively |                                                                       |                                             | 21,876                       |            |        |         | 23,459   |  
|                                                                                                              | Merchandise inventories                                                                                                                     |                                                                       |                                             | 16,549                       |            |        |         | 16,852   |  
|                                                                                                              | Prepaid expenses and other                                                                                                                  |                                                                       |                                             | 3,315                        |            |        |         | 3,141    |  
|                                                                                                              | Deferred tax asset                                                                                                                          |                                                                       |                                             | 5,238                        |            |        |         | 3,928    |  
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       
|                                                                                                              |                                                                                                                                             |                                                                       | Total current assets                        |                              |            | 71,755 |         |          |   | 88,790 |        
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       
|PROPERTY AND EQUIPMENT:                                                                                       |                                                                                                                                             |                                                                       |                                             |                              |            |        |         |         
|                                                                                                              | Leasehold improvements                                                                                                                      |                                                                       |                                             | 43,635                       |            |        |         | 41,969   |  
|                                                                                                              | Merchandising equipment                                                                                                                     |                                                                       |                                             | 57,435                       |            |        |         | 63,821   |  
|                                                                                                              | Vehicles and other equipment                                                                                                                |                                                                       |                                             | 11,532                       |            |        |         | 16,493   |  
|                                                                                                              | Construction in process                                                                                                                     |                                                                       |                                             | 32                           |            |        |         | 218      |  
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       
|                                                                                                              |                                                                                                                                             |                                                                       |                                             | Total                        |            |        | 112,634 |          |   |        | 122,501 | 
|                                                                                                              | Less accumulated depreciation and amortization                                                                                              |                                                                       |                                             | (64,412                      | )          |        |         | (72,776  | )
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       
|                                                                                                              |                                                                                                                                             |                                                                       |                                             | Property and equipment, net  |            |        | 48,222  |          |   |        | 49,725  | 
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       
|OTHER LONG-TERM ASSETS:                                                                                       |                                                                                                                                             |                                                                       |                                             |                              |            |        |         |         
|                                                                                                              | Contract rights, net                                                                                                                        |                                                                       |                                             | 87,981                       |            |        |         | 80,557   |  
|                                                                                                              | Restricted cash                                                                                                                             |                                                                       |                                             | 8,420                        |            |        |         | 8,616    |  
|                                                                                                              | Cost in excess of net assets acquired                                                                                                       |                                                                       |                                             | 41,142                       |            |        |         | 41,142   |  
|                                                                                                              | Deferred financing costs, net                                                                                                               |                                                                       |                                             | 11,707                       |            |        |         | 15,499   |  
|                                                                                                              | Trademarks                                                                                                                                  |                                                                       |                                             | 17,523                       |            |        |         | 17,523   |  
|                                                                                                              | Deferred tax asset                                                                                                                          |                                                                       |                                             | 8,259                        |            |        |         | 13,116   |  
|                                                                                                              | Other                                                                                                                                       |                                                                       |                                             | 4,037                        |            |        |         | 3,057    |  
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       
|                                                                                                              |                                                                                                                                             |                                                                       |                                             | Total other long-term assets |            |        | 179,069 |          |   |        | 179,510 | 
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       
|TOTAL ASSETS                                                                                                  |                                                                                                                                             | $                                                                     | 299,046                                     |                              |            | $      | 318,025 |         
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       
|                                                                                                             
|LIABILITIES AND STOCKHOLDERS EQUITY                                                                         
|CURRENT LIABILITIES:                                                                                          |                                                                                                                                             |                                                                       |                                             |                              |            |        |         |         
|                                                                                                              | Current portion of long-term debt                                                                                                           |                                                                       | $                                           |                             |            |        | $       | 1,075    |  
|                                                                                                              | Accounts payable                                                                                                                            |                                                                       |                                             | 19,103                       |            |        |         | 16,814   |  
|                                                                                                              | Accrued salaries and vacations                                                                                                              |                                                                       |                                             | 11,237                       |            |        |         | 13,263   |  
|                                                                                                              | Liability for insurance                                                                                                                     |                                                                       |                                             | 5,777                        |            |        |         | 6,689    |  
|                                                                                                              | Accrued taxes, including income taxes                                                                                                       |                                                                       |                                             | 4,543                        |            |        |         | 4,205    |  
|                                                                                                              | Accrued commissions and royalties                                                                                                           |                                                                       |                                             | 15,702                       |            |        |         | 15,838   |  
|                                                                                                              | Liability for derivatives                                                                                                                   |                                                                       |                                             | 4,655                        |            |        |         | 4,615    |  
|                                                                                                              | Accrued interest                                                                                                                            |                                                                       |                                             | 712                          |            |        |         | 988      |  
|                                                                                                              | Accrued dividends                                                                                                                           |                                                                       |                                             | 1,487                        |            |        |         | 1,487    |  
|                                                                                                              | Advance deposits                                                                                                                            |                                                                       |                                             | 3,737                        |            |        |         | 2,588    |  
|                                                                                                              | Other                                                                                                                                       |                                                                       |                                             | 3,290                        |            |        |         | 3,260    |  
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       
|                                                                                                              |                                                                                                                                             |                                                                       |                                             | Total current liabilities    |            |        | 70,243  |          |   |        | 70,822  | 
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       
|LONG-TERM LIABILITIES:                                                                                        |                                                                                                                                             |                                                                       |                                             |                              |            |        |         |         
|                                                                                                              | Long-term debt                                                                                                                              |                                                                       |                                             | 170,245                      |            |        |         | 210,864  |  
|                                                                                                              | Liability for insurance                                                                                                                     |                                                                       |                                             | 5,681                        |            |        |         | 5,874    |  
|                                                                                                              | Other liabilities                                                                                                                           |                                                                       |                                             | 651                          |            |        |         | 510      |  
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       
|                                                                                                              |                                                                                                                                             |                                                                       |                                             | Total long-term liabilities  |            |        | 176,577 |          |   |        | 217,248 | 
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       
|COMMITMENTS AND CONTINGENCIES                                                                                 |                                                                                                                                             |                                                                       |                                             |                              |            |        |         |         
|COMMON STOCK WITH CONVERSION OPTION, PAR VALUE $0.01,
    EXCHANGEABLE FOR SUBORDINATED DEBT, NET OF DISCOUNT |                                                                                                                                             |                                                                       | 14,352                                      |                              |            |        | 14,352  |         
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       
|STOCKHOLDERS EQUITY:                                                                                         |                                                                                                                                             |                                                                       |                                             |                              |            |        |         |         
|                                                                                                              | Common stock, $0.01 par value  authorized:
    100,000,000 shares;                                                                         |                                                                       |                                             |                              |            |        |         |          |  
|                                                                                                              |                                                                                                                                             | issued: 18,463,995 shares without conversion option;
    outstanding: |                                             |                              |            |        |         |          |   |       
|                                                                                                              |                                                                                                                                             |                                                                       | 18,463,995 shares without conversion option |                              |            | 185    |         |          |   | 185    |        
|                                                                                                              |                                                                                                                                             | issued: 21,531,152 shares with conversion option;
    outstanding:    |                                             |                              |            |        |         |          |   |       
|                                                                                                              |                                                                                                                                             |                                                                       | 4,060,997 shares with conversion option     |                              |            | 215    |         |          |   | 215    |        
|                                                                                                              | Additional paid-in capital                                                                                                                  |                                                                       |                                             | 218,331                      |            |        |         | 218,331  |  
|                                                                                                              | Accumulated deficit                                                                                                                         |                                                                       |                                             | (60,492                      | )          |        |         | (82,920  | )
|                                                                                                              | Accumulated other comprehensive income                                                                                                      |                                                                       |                                             | 575                          |            |        |         | 732      |  
|                                                                                                              | Treasury stock  at cost (17,470,153 shares)                                                                                                |                                                                       |                                             | (120,940                     | )          |        |         | (120,940 | )
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       
|                                                                                                              |                                                                                                                                             |                                                                       |                                             | Total stockholders equity   |            |        | 37,874  |          |   |        | 15,603  | 
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       
|TOTAL LIABILITIES AND STOCKHOLDERS EQUITY                                                                    |                                                                                                                                             | $                                                                     | 299,046                                     |                              |            | $      | 318,025 |         
|                                                                                                              |                                                                                                                                             |                                                                       |                                             |                              |            |       



F-3



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##### Table of Contents



CENTERPLATE, INC.





CONSOLIDATED STATEMENTS OF OPERATIONS


YEARS ENDED DECEMBER 30, 2003, DECEMBER 28, 2004
AND JANUARY 3, 2006


|                                                                                      |  |                                       |            |   |              |   |            |            |  |   |            |  
|------------------------------------------------------------------------------------- |  | ------------------------------------- | ---------- | - | ------------ | - | ---------- | ---------- |  | - | ---------- | -
|                                                                                      |  | December 30,                          |            |   | December 28, |   |            | January 3, | 
|                                                                                      |  | 2003                                  |            |   | 2004         |   |            | 2006       | 
|                                                                                      |  |                                       |            |   |              |   |            |            | 
|                                                                                      |  | (In thousands, except per share data) |           
|Net sales                                                                             |  | $                                     | 616,057    |   |              | $ | 607,154    |            |  | $ | 643,112    |  
|Cost of sales                                                                         |  |                                       | 503,986    |   |              |   | 492,462    |            |  |   | 519,395    |  
|Selling, general and administrative                                                   |  |                                       | 59,591     |   |              |   | 61,540     |            |  |   | 71,405     |  
|Depreciation and amortization                                                         |  |                                       | 27,119     |   |              |   | 26,644     |            |  |   | 29,255     |  
|Transaction related expenses                                                          |  |                                       | 2,577      |   |              |   |           |            |  |   | 1,006      |  
|Contract related losses                                                               |  |                                       | 831        |   |              |   | 411        |            |  |   | 369        |  
|                                                                                      |  |                                       |            |   |              |   |            |            | 
|Operating income                                                                      |  |                                       | 21,953     |   |              |   | 26,097     |            |  |   | 21,682     |  
|Interest expense                                                                      |  |                                       | 32,763     |   |              |   | 25,010     |            |  |   | 31,274     |  
|Other income, net                                                                     |  |                                       | (55        | ) |              |   | (266       | )          |  |   | (1,151     | )
|                                                                                      |  |                                       |            |   |              |   |            |            | 
|Income (loss) before income taxes                                                     |  |                                       | (10,755    | ) |              |   | 1,353      |            |  |   | (8,441     | )
|Income tax benefit                                                                    |  |                                       | (6,337     | ) |              |   | (967       | )          |  |   | (3,853     | )
|                                                                                      |  |                                       |            |   |              |   |            |            | 
|Net income (loss)                                                                     |  |                                       | (4,418     | ) |              |   | 2,320      |            |  |   | (4,588     | )
|Accretion of conversion option                                                        |  |                                       |           |   |              |   | (317       | )          |  |   |           |  
|                                                                                      |  |                                       |            |   |              |   |            |            | 
|Net income (loss) available to common stock with or without the
    conversion option |  | $                                     | (4,418     | ) |              | $ | 2,003      |            |  | $ | (4,588     | )
|                                                                                      |  |                                       |            |   |              |   |            |            | 
|Basic and Diluted Net Income (Loss) per share with conversion
    option              |  | $                                     | (0.31      | ) |              | $ | 0.17       |            |  | $ | (0.20      | )
|                                                                                      |  |                                       |            |   |              |   |            |            | 
|Basic and Diluted Net Income (Loss) per share without conversion
    option           |  | $                                     | (0.31      | ) |              | $ | 0.09       |            |  | $ | (0.20      | )
|                                                                                      |  |                                       |            |   |              |   |            |            | 
|Weighted average shares outstanding with conversion option                            |  |                                       | 364,738    |   |              |   | 4,060,997  |            |  |   | 4,060,997  |  
|Weighted average shares outstanding without conversion option                         |  |                                       | 13,898,426 |   |              |   | 18,463,995 |            |  |   | 18,463,995 |  
|                                                                                      |  |                                       |            |   |              |   |            |            | 
|Total weighted average shares outstanding                                             |  |                                       | 14,263,164 |   |              |   | 22,524,992 |            |  |   | 22,524,992 |  
|                                                                                      |  |                                       |            |   |              |   |            |            | 
|Dividends declared per share                                                          |  | $                                     | 0.09       |   |              | $ | 0.79       |            |  | $ | 0.79       |  
|                                                                                      |  |                                       |            |   |              |   |            |            | 



F-4



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##### Table of Contents



CENTERPLATE, INC.





CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY
(DEFICIENCY) AND


COMPREHENSIVE INCOME (LOSS)


YEARS ENDED DECEMBER 30, 2003, DECEMBER 28, 2004,
AND JANUARY 3, 2006


|                           |                                |                                                                                       |            |   |              |   |     |             |     |  |            |   |   |            |     |   |             |             |         |               |         |   |          |          |         |         |      |     |       |   |          |   |         |   |        |   |       |   |        |         |         |  
|-------------------------- | ------------------------------ | ------------------------------------------------------------------------------------- | ---------- | - | ------------ | - | --- | ----------- | --- |  | ---------- | - | - | ---------- | --- | - | ----------- | ----------- | ------- | ------------- | ------- | - | -------- | -------- | ------- | ------- | ---- | --- | ----- | - | -------- | - | ------- | - | ------ | - | ----- | - | ------ | ------- | ------- | -
|                           |                                | Common Shares                                                                         |            |   | Common Stock |   |     | Common      |     |  | Common     |   |   |            |     |   |             | Accumulated |         |               |         |   |          |          |        
|                           |                                | without                                                                               |            |   | without      |   |     | Shares with |     |  | Stock with |   |   | Additional |     |   |             |             | Other   |               |         |   |          | Loans to |         |         |     
|                           |                                | Conversion                                                                            |            |   | Conversion   |   |     | Conversion  |     |  | Conversion |   |   | Paid-in    |     |   | Accumulated |             |         | Comprehensive |         |   | Treasury |          |         | Related |      |     |      
|                           |                                | Option                                                                                |            |   | Option       |   |     | Option      |     |  | Option     |   |   | Capital    |     |   | Deficit     |             |         | Income/(Loss) |         |   | Stock    |          |         | Parties |      |     | Total |  
|                           |                                |                                                                                       |            |   |              |   |     |             |     |  |            |   |   |            |     |   |             |             |         |               |         |   |          |          |         |         |      |     |       |  
|                           |                                | (In thousands, except share data)                                                     |           
|Balance, December 31, 2002 |                                |                                                                                       |           |   |              | $ |    |             |     |  | 21,531,152 |   |   | $          | 215 |   |             | $           | 67,202  |               |         | $ | (21,566  | )        |         | $       | (444 | )   |       | $ | (49,500  | ) |         | $ | (1,175 | ) |       | $ | (5,268 | )      
|                           |                                | Proceeds from IDS issuance, net                                                       |            |   | 18,463,995   |   |     |             | 185 |  |            |   |  |            |     |   |            |             |         |               | 151,332 |   |          |          |        |         |      |     |      |   |          |   |        |   |        |   | 1,241 |   |        |         | 152,758 |  
|                           |                                | Derivative liability                                                                  |            |   |             |   |     |             |    |  |            |   |  |            |     |   |            |             |         |               |        |   |          |          | (2,654  | )       |      |     |      |   |          |   |        |   |        |   |      |   |        |         | (2,654  | )
|                           |                                | Common Stock, par value $0.01 exchangeable for subordinated
    debt, net of discount |            |   |             |   |     |             |    |  |            |   |  |            |     |   |            |             |         |               |        |   |          |          | (14,035 | )       |      |     |      |   |          |   |        |   |        |   |      |   |        |         | (14,035 | )
|                           |                                | Repurchase of stock                                                                   |            |   |             |   |     |             |    |  |            |   |  |            |     |   |            |             |         |               |        |   |          |          |        |         |      |     |      |   |          |   | (71,440 | ) |        |   |      |   |        |         | (71,440 | )
|                           |                                | Noncash compensation                                                                  |            |   |             |   |     |             |    |  |            |   |  |            |     |   |            |             |         |               | 64      |   |          |          |        |         |      |     |      |   |          |   |        |   |        |   |      |   |        |         | 64      |  
|                           |                                | Loans to related parties                                                              |            |   |             |   |     |             |    |  |            |   |  |            |     |   |            |             |         |               |        |   |          |          |        |         |      |     |      |   |          |   |        |   |        |   | (66   | ) |        |         | (66     | )
|                           |                                | Foreign currency translation                                                          |            |   |             |   |     |             |    |  |            |   |  |            |     |   |            |             |         |               |        |   |          |          |        |         |      |     | 668   |   |          |   |        |   |        |   |      |   |        |         | 668     |  
|                           |                                | Dividends declared                                                                    |            |   |             |   |     |             |    |  |            |   |  |            |     |   |            |             |         |               |        |   |          |          | (1,982  | )       |      |     |      |   |          |   |        |   |        |   |      |   |        |         | (1,982  | )
|                           |                                | Net loss                                                                              |            |   |             |   |     |             |    |  |            |   |  |            |     |   |            |             |         |               |        |   |          |          | (4,418  | )       |      |     |      |   |          |   |        |   |        |   |      |   |        |         | (4,418  | )
|                           |                                |                                                                                       |            |   |              |   |     |             |     |  |            |   |   |            |     |   |             |             |         |               |         |   |          |          |         |         |      |     |       |  
|Balance, December 30, 2003 |                                |                                                                                       | 18,463,995 |   |              |   | 185 |             |     |  | 21,531,152 |   |   |            | 215 |   |             |             | 218,598 |               |         |   | (44,655  | )        |         |         | 224  |     |       |   | (120,940 | ) |         |   |       |   |       |   | 53,627 |        
|                           | Payment of issuance costs      |                                                                                       |            |  |              |   |     |            |     |  |            |  |   |            |     |  |             |             |         | (267          | )       |   |          |         |         |         |      |    |       |   |          |  |         |   |        |  |       |   |        | (267    | )      
|                           | Foreign currency translation   |                                                                                       |            |  |              |   |     |            |     |  |            |  |   |            |     |  |             |             |         |              |         |   |          |         |         |         |      | 351 |       |   |          |  |         |   |        |  |       |   |        | 351     |        
|                           | Accretion of conversion option |                                                                                       |            |  |              |   |     |            |     |  |            |  |   |            |     |  |             |             |         |              |         |   |          | (317     | )       |         |      |    |       |   |          |  |         |   |        |  |       |   |        | (317    | )      
|                           | Dividends declared             |                                                                                       |            |  |              |   |     |            |     |  |            |  |   |            |     |  |             |             |         |              |         |   |          | (17,840  | )       |         |      |    |       |   |          |  |         |   |        |  |       |   |        | (17,840 | )      
|                           | Net income                     |                                                                                       |            |  |              |   |     |            |     |  |            |  |   |            |     |  |             |             |         |              |         |   |          | 2,320    |         |         |      |    |       |   |          |  |         |   |        |  |       |   |        | 2,320   |        
|                           |                                |                                                                                       |            |   |              |   |     |             |     |  |            |   |   |            |     |   |             |             |         |               |         |   |          |          |         |         |      |     |       |  
|Balance, December 28, 2004 |                                |                                                                                       | 18,463,995 |   |              | $ | 185 |             |     |  | 21,531,152 |   |   | $          | 215 |   |             | $           | 218,331 |               |         | $ | (60,492  | )        |         | $       | 575  |     |       | $ | (120,940 | ) |         | $ |       |   |       | $ | 37,874 |        
|                           | Foreign currency translation   |                                                                                       |            |  |              |   |     |            |     |  |            |  |   |            |     |  |             |             |         |              |         |   |          |         |         |         |      | 157 |       |   |          |  |         |   |        |  |       |   |        | 157     |        
|                           | Dividends declared             |                                                                                       |            |  |              |   |     |            |     |  |            |  |   |            |     |  |             |             |         |              |         |   |          | (17,840  | )       |         |      |    |       |   |          |  |         |   |        |  |       |   |        | (17,840 | )      
|                           | Net loss                       |                                                                                       |            |  |              |   |     |            |     |  |            |  |   |            |     |  |             |             |         |              |         |   |          | (4,588   | )       |         |      |    |       |   |          |  |         |   |        |  |       |   |        | (4,588  | )      
|                           |                                |                                                                                       |            |   |              |   |     |             |     |  |            |   |   |            |     |   |             |             |         |               |         |   |          |          |         |         |      |     |       |  
|Balance, January 3, 2006   |                                |                                                                                       | 18,463,995 |   |              | $ | 185 |             |     |  | 21,531,152 |   |   | $          | 215 |   |             | $           | 218,331 |               |         | $ | (82,920  | )        |         | $       | 732  |     |       | $ | (120,940 | ) |         | $ |       |   |       | $ | 15,603 |        
|                           |                                |                                                                                       |            |   |              |   |     |             |     |  |            |   |   |            |     |   |             |             |         |               |         |   |          |          |         |         |      |     |       |  

|                                                                         |  |              |        |   |              |   |       |            |  |   |        |  
|------------------------------------------------------------------------ |  | ------------ | ------ | - | ------------ | - | ----- | ---------- |  | - | ------ | -
|                                                                         |  | December 30, |        |   | December 28, |   |       | January 3, | 
|                                                                         |  | 2003         |        |   | 2004         |   |       | 2006       | 
|                                                                         |  |              |        |   |              |   |       |            | 
|Net income (loss)                                                        |  | $            | (4,418 | ) |              | $ | 2,320 |            |  | $ | (4,588 | )
|Other comprehensive income  foreign currency
    translation adjustment |  |              | 668    |   |              |   | 351   |            |  |   | 157    |  
|                                                                         |  |              |        |   |              |   |       |            | 
|Comprehensive income (loss)                                              |  | $            | (3,750 | ) |              | $ | 2,671 |            |  | $ | (4,431 | )
|                                                                         |  |              |        |   |              |   |       |            | 



F-5



---



##### Table of Contents



CENTERPLATE, INC.





CONSOLIDATED STATEMENTS OF CASH FLOWS


YEARS ENDED DECEMBER 30, 2003, DECEMBER 28, 2004,
AND JANUARY 3, 2006


|                                                               |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |        |   |        |         |        |   |        |         |  
|-------------------------------------------------------------- | -------------------------------------------------------------------------------------------- | ------------------------------------------- | ----------------------------------- | --------------------------------- | --------------------------------------------------- | - | ------ | ---------- | ------ | - | ------ | ------- | ------ | - | ------ | ------- | -
|                                                               |                                                                                              | Years Ended                                 |                                    
|                                                               |                                                                                              |                                             |                                    
|                                                               |                                                                                              | December 30,                                |                                     |                                   | December 28,                                        |   |        | January 3, |       
|                                                               |                                                                                              | 2003                                        |                                     |                                   | 2004                                                |   |        | 2006       |       
|                                                               |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |       
|                                                               |                                                                                              | (In thousands)                              |                                    
|CASH FLOWS FROM OPERATING ACTIVITIES:                          |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |        |   |        |        
|                                                               | Net income (loss)                                                                            |                                             | $                                   | (4,418                            | )                                                   |   | $      | 2,320      |        |   | $      | (4,588  | )     
|                                                               | Adjustments to reconcile net income (loss) to net cash provided
    by operating activities: |                                             |                                     |                                   |                                                     |   |        |            |        |   |        |         |       
|                                                               |                                                                                              | Depreciation and amortization               |                                     |                                   | 27,119                                              |   |        |            | 26,644 |   |        |         | 29,255 |  
|                                                               |                                                                                              | Amortization of deferred financing costs    |                                     |                                   | 6,906                                               |   |        |            | 1,814  |   |        |         | 3,474  |  
|                                                               |                                                                                              | Charge for impaired assets                  |                                     |                                   | 831                                                 |   |        |            | 411    |   |        |         | 1,375  |  
|                                                               |                                                                                              | Noncash compensation                        |                                     |                                   | 64                                                  |   |        |            |       |   |        |         |       |  
|                                                               |                                                                                              | Derivative noncash interest                 |                                     |                                   |                                                    |   |        |            | 2,001  |   |        |         | (40    | )
|                                                               |                                                                                              | Non-cash interest earned on restricted cash |                                     |                                   |                                                    |   |        |            |       |   |        |         | (196   | )
|                                                               |                                                                                              | Deferred tax change                         |                                     |                                   | (6,178                                              | ) |        |            | (1,272 | ) |        |         | (3,547 | )
|                                                               |                                                                                              | (Gain) loss on disposition of assets        |                                     |                                   | (69                                                 | ) |        |            | 103    |   |        |         | 15     |  
|                                                               |                                                                                              | Other                                       |                                     |                                   | 668                                                 |   |        |            | 351    |   |        |         | 157    |  
|                                                               |                                                                                              | Changes in assets and liabilities:          |                                     |                                   |                                                     |   |        |            |        |   |        |         |        |  
|                                                               |                                                                                              |                                             | Decrease (increase) in assets:      |                                   |                                                     |   |        |            |        |   |        |         |        |   |       
|                                                               |                                                                                              |                                             |                                     | Accounts receivable               |                                                     |   | (1,080 | )          |        |   | (4,139 | )       |        |   | (1,149 | )      
|                                                               |                                                                                              |                                             |                                     | Merchandise inventories           |                                                     |   | (1,183 | )          |        |   | (1,684 | )       |        |   | (303   | )      
|                                                               |                                                                                              |                                             |                                     | Prepaid expenses                  |                                                     |   | (970   | )          |        |   | 7      |         |        |   | 174    |        
|                                                               |                                                                                              |                                             |                                     | Other assets                      |                                                     |   | 1,525  |            |        |   | (1,412 | )       |        |   | (423   | )      
|                                                               |                                                                                              |                                             | Increase (decrease) in liabilities: |                                   |                                                     |   |        |            |        |   |        |         |        |   |       
|                                                               |                                                                                              |                                             |                                     | Accounts payable                  |                                                     |   | 1,974  |            |        |   | (617   | )       |        |   | 1,045  |        
|                                                               |                                                                                              |                                             |                                     | Accrued salaries and vacations    |                                                     |   | 2,614  |            |        |   | (60    | )       |        |   | 2,026  |        
|                                                               |                                                                                              |                                             |                                     | Liability for insurance           |                                                     |   | 2,340  |            |        |   | 2,676  |         |        |   | 1,105  |        
|                                                               |                                                                                              |                                             |                                     | Accrued commissions and royalties |                                                     |   | 426    |            |        |   | 155    |         |        |   | 1,410  |        
|                                                               |                                                                                              |                                             |                                     | Other liabilities                 |                                                     |   | (3,410 | )          |        |   | 1,141  |         |        |   | (1,382 | )      
|                                                               |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |       
|                                                               |                                                                                              |                                             |                                     |                                   | Net cash provided by operating activities           |   |        | 27,159     |        |   |        | 28,439  |        |   |        | 28,408  |  
|                                                               |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |       
|CASH FLOWS FROM INVESTING ACTIVITIES:                          |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |        |   |        |        
|                                                               | Purchase of property and equipment                                                           |                                             |                                     | (7,904                            | )                                                   |   |        | (7,969     | )      |   |        | (14,712 | )     
|                                                               | Proceeds from sale of property and equipment                                                 |                                             |                                     | 585                               |                                                     |   |        | 809        |        |   |        | 338     |       
|                                                               | Purchase of contract rights                                                                  |                                             |                                     | (16,029                           | )                                                   |   |        | (15,900    | )      |   |        | (10,363 | )     
|                                                               | Return of unamortized capital investment                                                     |                                             |                                     |                                  |                                                     |   |        | 16,531     |        |   |        |        |       
|                                                               | Restricted cash                                                                              |                                             |                                     | (22,048                           | )                                                   |   |        | 13,628     |        |   |        |        |       
|                                                               |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |       
|                                                               |                                                                                              |                                             |                                     |                                   | Net cash provided by (used in) investing activities |   |        | (45,396    | )      |   |        | 7,099   |        |   |        | (24,737 | )
|                                                               |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |       
|CASH FLOWS FROM FINANCING ACTIVITIES:                          |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |        |   |        |        
|                                                               | Net repayments  revolving loans                                                             |                                             | $                                   | (11,000                           | )                                                   |   | $      | (4,000     | )      |   | $      |        |       
|                                                               | Principal payments on long-term debt                                                         |                                             |                                     | (110,400                          | )                                                   |   |        |           |        |   |        | (806    | )     
|                                                               | Proceeds from issuance of long-term debt                                                     |                                             |                                     | 65,000                            |                                                     |   |        |           |        |   |        | 107,500 |       
|                                                               | Retirement of existing long-term borrowings                                                  |                                             |                                     |                                  |                                                     |   |        |           |        |   |        | (65,000 | )     
|                                                               | Proceeds from issuance of stock, net                                                         |                                             |                                     | 151,517                           |                                                     |   |        |           |        |   |        |        |       
|                                                               | Proceeds from issuance of subordinated notes                                                 |                                             |                                     | 105,245                           |                                                     |   |        |           |        |   |        |        |       
|                                                               | Payment of existing subordinated notes                                                       |                                             |                                     | (87,750                           | )                                                   |   |        | (12,250    | )      |   |        |        |       
|                                                               | Repurchase of stock                                                                          |                                             |                                     | (71,440                           | )                                                   |   |        |           |        |   |        |        |       
|                                                               | Proceeds from loans to related parties                                                       |                                             |                                     | 1,241                             |                                                     |   |        |           |        |   |        |        |       
|                                                               | Payments of debt issuance costs                                                              |                                             |                                     | (12,837                           | )                                                   |   |        | (267       | )      |   |        |        |       
|                                                               | Payments of financing costs                                                                  |                                             |                                     |                                  |                                                     |   |        | (504       | )      |   |        | (7,266  | )     
|                                                               | Increase (decrease) in bank overdrafts                                                       |                                             |                                     | 1,282                             |                                                     |   |        | 1,666      |        |   |        | (3,626  | )     
|                                                               | Loans to related parties                                                                     |                                             |                                     | (66                               | )                                                   |   |        |           |        |   |        |        |       
|                                                               | Dividend payments                                                                            |                                             |                                     |                                  |                                                     |   |        | (18,335    | )      |   |        | (17,840 | )     
|                                                               |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |       
|                                                               |                                                                                              |                                             |                                     |                                   | Net cash provided by (used in) financing activities |   |        | 30,792     |        |   |        | (33,690 | )      |   |        | 12,962  |  
|                                                               |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |       
|INCREASE IN CASH                                               |                                                                                              |                                             | 12,555                              |                                   |                                                     |   | 1,848  |            |        |   | 16,633 |        
|CASH AND CASH EQUIVALENTS:                                     |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |        |   |        |        
|                                                               | Beginning of year                                                                            |                                             |                                     | 10,374                            |                                                     |   |        | 22,929     |        |   |        | 24,777  |       
|                                                               |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |       
|                                                               | End of year                                                                                  |                                             | $                                   | 22,929                            |                                                     |   | $      | 24,777     |        |   | $      | 41,410  |       
|                                                               |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |       
|SUPPLEMENTAL CASH FLOW INFORMATION:                            |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |        |   |        |        
|                                                               | Interest paid                                                                                |                                             | $                                   | 35,029                            |                                                     |   | $      | 22,209     |        |   | $      | 27,563  |       
|                                                               |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |       
|                                                               | Income taxes paid                                                                            |                                             | $                                   | 72                                |                                                     |   | $      | 68         |        |   | $      | 31      |       
|                                                               |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |       
|SUPPLEMENTAL NON CASH FLOW INVESTING AND FINANCING ACTIVITIES: |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |        |   |        |        
|Non-cash investing and financing activities:                   |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |        |   |        |        
|                                                               | Reduction in cost of net assets acquired due to the recognition
    of acquired tax assets   |                                             | $                                   |                                  |                                                     |   | $      | 5,314      |        |   | $      |        |       
|                                                               |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |       
|                                                               | Capital investment commitment                                                                |                                             | $                                   |                                  |                                                     |   | $      | 1,744      |        |   | $      | 200     |       
|                                                               |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |       
|                                                               | Dividends declared and unpaid                                                                |                                             | $                                   | 1,982                             |                                                     |   | $      | 1,487      |        |   | $      | 1,487   |       
|                                                               |                                                                                              |                                             |                                     |                                   |                                                     |   |        |            |       



F-6



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##### Table of Contents



CENTERPLATE, INC.





NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


YEARS ENDED DECEMBER 30, 2003, DECEMBER 28, 2004
AND JANUARY 3, 2006




|   |        
|-- | -------
|1. | GENERAL









|   |                                           
|-- | ------------------------------------------
|2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation


Fiscal Year


Cash and Cash Equivalents


Restricted Cash


Revenue Recognition


Merchandise Inventories first-in,


F-7



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##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


Depreciation




| |   |                                                                                                   
| | - | --------------------------------------------------------------------------------------------------
| |  | Leasehold improvements  10 years 
    limited by the lease term or contract term, if applicable 
|
| |  | Merchandising equipment  5 to
    10 years  limited by the contract term, if
    applicable     
|
| |  | Vehicles and other equipment  2 to
    10 years  limited by the contract term, if
    applicable

Contract Rights


Cost in Excess of Net Assets Acquired and
Trademarks


Goodwill and Other Intangible
Assets


Deferred Financing Costs


Impairment of Long-Lived Assets and Contract
Rights


F-8



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##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




Accounting Treatment for IDSs, Common Stock Owned by Initial
Equity Investors and Derivative Financial
Instruments 10-year 10-year Accounting for
Derivative Instruments and Hedging Activities




Redeemable Preferred Stocks.


F-9



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##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


180-day




Insurance




Cash Overdrafts


Dividends


Foreign Currency


F-10



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##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




Transaction Related Expenses


Interest


Income Taxes


Segment Reporting


F-11



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##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


Net Income (Loss) per Share 


|                                                   |  |                    |             |   |             |  |                  |             |        |  |             |        |  |            |       |  |            |  |            |       |  |  |         |  |  |  |            | 
|-------------------------------------------------- |  | ------------------ | ----------- | - | ----------- |  | ---------------- | ----------- | ------ |  | ----------- | ------ |  | ---------- | ----- |  | ---------- |  | ---------- | ----- |  |  | ------- |  |  |  | ---------- | 
|                                                   |  | Shares Outstanding |             |   |             |  | Weighted Average |            
|                                                   |  |                    |             |   |             |  |                  |            
|                                                   |  | Shares             |             |   |             |  |                  |             | Shares |  |             | Shares |  |            |      
|                                                   |  | without            |             |   | Shares with |  |                  | Total       |        |  | Multiply by |        |  | without    |       |  | with       |  |            |      
|                                                   |  | Conversion         |             |   | Conversion  |  |                  | Shares      |        |  | Weighted    |        |  | Conversion |       |  | Conversion |  |            |      
|                                                   |  | Option             |             |   | Option      |  |                  | Outstanding |        |  | Average(1)  |        |  | Option     |       |  | Option     |  |            | Total | 
|                                                   |  |                    |             |   |             |  |                  |             |        |  |             |        |  |            |       |  |            |  |            |       | 
|Shares Outstanding as of 12/31/2002                |  |                    | 13,612,829  |   |             |  |                 |             |        |  | 13,612,829  |        |  |            | 93.1% |  |            |  | 12,667,493 |       |  |  |        |  |  |  | 12,667,493 | 
|Conversion Option Granted(2)                       |  |                    | (13,612,829 | ) |             |  | 13,612,829       |             |        |  |            |        |  |            |       |  |            |  |            |       |  |  |         |  |  |  |            | 
|Repurchase of Stock 12/05/03                       |  |                    |             |   |             |  | (6,844,502       | )           |        |  | (6,844,502  | )      |  |            |       |  |            |  |            |       |  |  |         |  |  |  |            | 
|Issuance of Common Stock 12/05/03                  |  |                    | 16,785,450  |   |             |  |                 |             |        |  | 16,785,450  |        |  |            |       |  |            |  |            |       |  |  |         |  |  |  |            | 
|                                                   |  |                    |             |   |             |  |                  |             |        |  |             |        |  |            |       |  |            |  |            |       | 
|Total Shares Outstanding as of 12/05/03            |  |                    | 16,785,450  |   |             |  | 6,768,327        |             |        |  | 23,553,777  |        |  |            | 3.1%  |  |            |  | 512,889    |       |  |  | 206,810 |  |  |  | 719,699    | 
|Repurchase of stock 12/16/03                       |  |                    |             |   |             |  | (2,707,330       | )           |        |  | (2,707,330  | )      |  |            |       |  |            |  |            |       |  |  |         |  |  |  |            | 
|Issuance of Common Stock 12/16/03                  |  |                    | 1,678,545   |   |             |  |                 |             |        |  | 1,678,545   |        |  |            |       |  |            |  |            |       |  |  |         |  |  |  |            | 
|                                                   |  |                    |             |   |             |  |                  |             |        |  |             |        |  |            |       |  |            |  |            |       | 
|Total Shares Outstanding as of 12/16/03(3)         |  |                    | 18,463,995  |   |             |  | 4,060,997        |             |        |  | 22,524,992  |        |  |            | 3.9%  |  |            |  | 718,044    |       |  |  | 157,928 |  |  |  | 875,972    | 
|                                                   |  |                    |             |   |             |  |                  |             |        |  |             |        |  |            |       |  |            |  |            |       | 
|Weighted Average Shares Outstanding as of 12/30/03 |  |                    |             |   |             |  |                  |             |        |  |             |        |  |            |       |  |            |  | 13,898,426 |       |  |  | 364,738 |  |  |  | 14,263,164 | 
|                                                   |  |                    |             |   |             |  |                  |             |        |  |             |        |  |            |       |  |            |  |            |       | 






|    |                                                           
|--- | ----------------------------------------------------------
|(1) | Weighted average based on number of days outstanding      
|   
|(2) | Upon IPO existing stock was granted conversion option     
|   
|(3) | No subsequent change in shares outstanding since this date

F-12



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##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


|                                                                             |  |                                     |        |   |               |  |            |           |  |   |       |  
|---------------------------------------------------------------------------- |  | ----------------------------------- | ------ | - | ------------- |  | ---------- | --------- |  | - | ----- | -
|                                                                             |  | Fiscal Year Ended December 30, 2003 |       
|                                                                             |  |                                     |       
|                                                                             |  | Income (Loss)                       |        |   | Shares        |  |            | Per Share | 
|                                                                             |  | (Numerator)                         |        |   | (Denominator) |  |            | Amount    | 
|                                                                             |  |                                     |        |   |               |  |            |           | 
|                                                                             |  | (In thousands, except share data)   |       
|Net Loss                                                                     |  | $                                   | (4,418 | ) |               |  |            |           |  |   |       |  
|Accretion of conversion option                                               |  |                                     |       |   |               |  |            |           |  |   |       |  
|                                                                             |  |                                     |        |   |               |  |            |           | 
|Net Loss available to common stock with or without the
    conversion option |  | $                                   | (4,418 | ) |               |  |            |           |  |   |       |  
|Weighted Average Shares Outstanding with conversion option                   |  |                                     |        |   |               |  | 364,738    |           |  |   |       |  
|Weighted Average Shares Outstanding without conversion option                |  |                                     |        |   |               |  | 13,898,426 |           |  |   |       |  
|                                                                             |  |                                     |        |   |               |  |            |           | 
|Total Weighted Average Shares Outstanding                                    |  |                                     |        |   |               |  | 14,263,164 |           |  |   |       |  
|Basic and Diluted Net Loss per share with conversion option                  |  | $                                   | (4,418 | ) |               |  | 14,263,164 |           |  | $ | (0.31 | )
|Basic and Diluted Net Loss per share without conversion option               |  | $                                   | (4,418 | ) |               |  | 14,263,164 |           |  | $ | (0.31 | )

|                                                                               |  |                                     |       |   |               |  |            |           |  |   |      | 
|------------------------------------------------------------------------------ |  | ----------------------------------- | ----- | - | ------------- |  | ---------- | --------- |  | - | ---- | 
|                                                                               |  | Fiscal Year Ended December 28, 2004 |      
|                                                                               |  |                                     |      
|                                                                               |  | Income                              |       |   | Shares        |  |            | Per Share | 
|                                                                               |  | (Numerator)                         |       |   | (Denominator) |  |            | Amount    | 
|                                                                               |  |                                     |       |   |               |  |            |           | 
|                                                                               |  | (In thousands, except share data)   |      
|Net Income                                                                     |  | $                                   | 2,320 |   |               |  |            |           |  |   |      | 
|Accretion of conversion option                                                 |  |                                     | (317  | ) |               |  |            |           |  |   |      | 
|                                                                               |  |                                     |       |   |               |  |            |           | 
|Net Income available to common stock with or without the
    conversion option |  | $                                   | 2,003 |   |               |  |            |           |  |   |      | 
|Weighted Average Shares Outstanding with conversion option                     |  |                                     |       |   |               |  | 4,060,997  |           |  |   |      | 
|Weighted Average Shares Outstanding without conversion option                  |  |                                     |       |   |               |  | 18,463,995 |           |  |   |      | 
|                                                                               |  |                                     |       |   |               |  |            |           | 
|Total Weighted Average Shares Outstanding                                      |  |                                     |       |   |               |  | 22,524,992 |           |  |   |      | 
|Net Income available to common stock with or without the
    conversion option |  | $                                   | 2,003 |   |               |  | 22,524,992 |           |  | $ | 0.09 | 
|Accretion of conversion option                                                 |  | $                                   | 317   |   |               |  | 4,060,997  |           |  | $ | 0.08 | 
|                                                                               |  |                                     |       |   |               |  |            |           | 
|Basic and Diluted Net Income per share with conversion option                  |  |                                     |       |   |               |  |            |           |  | $ | 0.17 | 
|Basic and Diluted Net Income per share without conversion option               |  | $                                   | 2,003 |   |               |  | 22,524,992 |           |  | $ | 0.09 | 

F-13



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##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


|                                                                             |  |                                   |        |   |               |  |            |           |  |   |       |  
|---------------------------------------------------------------------------- |  | --------------------------------- | ------ | - | ------------- |  | ---------- | --------- |  | - | ----- | -
|                                                                             |  | Fiscal Year Ended January 3, 2006 |       
|                                                                             |  |                                   |       
|                                                                             |  | Income (Loss)                     |        |   | Shares        |  |            | Per Share | 
|                                                                             |  | (Numerator)                       |        |   | (Denominator) |  |            | Amount    | 
|                                                                             |  |                                   |        |   |               |  |            |           | 
|Net Loss                                                                     |  | $                                 | (4,588 | ) |               |  |            |           |  |   |       |  
|Accretion of conversion option                                               |  |                                   |       |   |               |  |            |           |  |   |       |  
|                                                                             |  |                                   |        |   |               |  |            |           | 
|Net Loss available to common stock with or without the
    conversion option |  | $                                 | (4,588 | ) |               |  |            |           |  |   |       |  
|Weighted Average Shares Outstanding with conversion option                   |  |                                   |        |   |               |  | 4,060,997  |           |  |   |       |  
|Weighted Average Shares Outstanding without conversion option                |  |                                   |        |   |               |  | 18,463,995 |           |  |   |       |  
|                                                                             |  |                                   |        |   |               |  |            |           | 
|Total Weighted Average Shares Outstanding                                    |  |                                   |        |   |               |  | 22,524,992 |           |  |   |       |  
|Basic and Diluted Net Loss per share with conversion option                  |  | $                                 | (4,588 | ) |               |  | 22,524,992 |           |  | $ | (0.20 | )
|Basic and Diluted Net Loss per share without conversion option               |  | $                                 | (4,588 | ) |               |  | 22,524,992 |           |  | $ | (0.20 | )

Reclassifications


Noncash Compensation Accounting for Stock Issued to
Employees for Stock-Based Compensation.


New Accounting Standards Share-Based
Payment




F-14



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##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                    
|-- | -----------------------------------
|3. | SIGNIFICANT RISKS AND UNCERTAINTIES

Use of Estimates


Certain Risk Concentrations








|   |     
|-- | ----
|4. | DEBT



|                                                |  |                |         |  |      |   |         | 
|----------------------------------------------- |  | -------------- | ------- |  | ---- | - | ------- | 
|                                                |  | 2004           |         |  | 2005 |  
|                                                |  |                |         |  |      |  
|                                                |  | (In thousands) |        
|Term Loans  2003 Credit Agreement              |  | $              | 65,000  |  |      | $ |        | 
|Term Loans  2005 Credit Agreement              |  |                |        |  |      |   | 106,694 | 
|Centerplate subordinated notes  Issued in 2003 |  |                | 105,245 |  |      |   | 105,245 | 
|                                                |  |                |         |  |      |  
|                                                |  |                | 170,245 |  |      |   | 211,939 | 
|Less  current portion of long-term debt        |  |                |        |  |      |   | 1,075   | 
|                                                |  |                |         |  |      |  
|Total long-term debt                            |  | $              | 170,245 |  |      | $ | 210,864 | 
|                                                |  |                |         |  |      |  

Initial Public Offering S-1


2003 Credit Agreement


F-15



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##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


clean-up clean-up clean-up clean-up




Subordinated Notes Issued in 2003 non-U.S.




Use of Proceeds


2005 Credit Agreement


F-16



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##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)










| |   |                                                                                                                                                                                                                        
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Interest coverage ratio (Adjusted EBITDA to cash interest
    expense for the last 12 months) at least equal to 2.05 to
    1.0 through fiscal 2006 and 2.00 to 1.00 thereafter;                                       
|
| |  | A maximum total leverage ratio (net debt as of the date of
    determination to Adjusted EBITDA for the 12 months ended on
    such date) of 4.65 to 1.00; and                                                         
|
| |  | A maximum senior leverage ratio (net senior debt as of the date
    of determination to Adjusted EBITDA for the 12 months
    ending on such date) of 2.25 to 1.00 through fiscal 2006 and
    2.15 to 1.00 thereafter.







F-17



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##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|           |  |   |         | 
|---------- |  | - | ------- | 
|2006       |  | $ | 1,075   | 
|2007       |  |   | 1,075   | 
|2008       |  |   | 1,075   | 
|2009       |  |   | 1,075   | 
|2010       |  |   | 102,394 | 
|Thereafter |  |   | 105,245 | 
|           |  |   |        
|Total      |  | $ | 211,939 | 
|           |  |   |        



|   |             
|-- | ------------
|5. | INCOME TAXES

|                                                                                                                   |                                                        |                |        |        |      |   |        |        |  
|------------------------------------------------------------------------------------------------------------------ | ------------------------------------------------------ | -------------- | ------ | ------ | ---- | - | ------ | ------ | -
|                                                                                                                   |                                                        | 2004           |        |        | 2005 |  
|                                                                                                                   |                                                        |                |        |        |      |  
|                                                                                                                   |                                                        | (In thousands) |       
|Deferred tax liabilities:                                                                                          |                                                        |                |        |        |      |   |        |       
|                                                                                                                   | Intangibles (goodwill, contract rights and trademarks) |                | $      | (6,489 | )    |   | $      | (6,407 | )
|                                                                                                                   | Differences between book and tax basis of property     |                |        | (1,804 | )    |   |        | (747   | )
|                                                                                                                   | Other                                                  |                |        | (445   | )    |   |        | (1,628 | )
|                                                                                                                   |                                                        |                |        |        |      |  
|                                                                                                                   |                                                        |                | (8,738 | )      |      |   | (8,782 | )     
|                                                                                                                   |                                                        |                |        |        |      |  
|Deferred tax assets:                                                                                               |                                                        |                |        |        |      |   |        |       
|                                                                                                                   | Bad debt reserves                                      |                |        | 154    |      |   |        | 364    |  
|                                                                                                                   | Inventory reserves                                     |                |        | 186    |      |   |        | 172    |  
|                                                                                                                   | Other reserves and accrued liabilities                 |                |        | 5,597  |      |   |        | 5,581  |  
|                                                                                                                   | General business and AMT credit carryforwards          |                |        | 7,988  |      |   |        | 8,356  |  
|                                                                                                                   | Accrued compensation and vacation                      |                |        | 1,333  |      |   |        | 1,133  |  
|                                                                                                                   | Net operating loss carryforward                        |                |        | 6,977  |      |   |        | 10,220 |  
|                                                                                                                   |                                                        |                |        |        |      |  
|                                                                                                                   |                                                        |                | 22,235 |        |      |   | 25,826 |       
|Net deferred tax asset                                                                                             |                                                        | $              | 13,497 |        |      | $ | 17,044 |       
|                                                                                                                   |                                                        |                |        |        |      |  
|Net deferred tax asset is recognized as follows in the
    accompanying 2003 and 2004 consolidated balance sheets: |                                                        |                |        |        |      |   |        |       
|                                                                                                                   | Current deferred tax asset                             |                | $      | 5,238  |      |   | $      | 3,928  |  
|                                                                                                                   | Noncurrent deferred tax asset                          |                |        | 8,259  |      |   |        | 13,116 |  
|                                                                                                                   |                                                        |                |        |        |      |  
|Net deferred tax asset                                                                                             |                                                        | $              | 13,497 |        |      | $ | 17,044 |       
|                                                                                                                   |                                                        |                |        |        |      |  





F-18



---



##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                               |  |                   |        |   |              |   |        |            |  |   |        |  
|------------------------------ |  | ----------------- | ------ | - | ------------ | - | ------ | ---------- |  | - | ------ | -
|                               |  | Fiscal Year Ended |       
|                               |  |                   |       
|                               |  | December 30,      |        |   | December 28, |   |        | January 3, | 
|                               |  | 2003              |        |   | 2004         |   |        | 2006       | 
|                               |  |                   |        |   |              |   |        |            | 
|                               |  | (In thousands)    |       
|Current provision (benefit)    |  | $                 | (159   | ) |              | $ | 305    |            |  | $ | (306   | )
|Deferred benefit               |  |                   | (6,178 | ) |              |   | (1,272 | )          |  |   | (3,547 | )
|                               |  |                   |        |   |              |   |        |            | 
|Total benefit for income taxes |  | $                 | (6,337 | ) |              | $ | (967   | )          |  | $ | (3,853 | )
|                               |  |                   |        |   |              |   |        |            | 



|                               |                                                  |                   |     |     |              |  |     |            |   |  |     |    |  
|------------------------------ | ------------------------------------------------ | ----------------- | --- | --- | ------------ |  | --- | ---------- | - |  | --- | -- | -
|                               |                                                  | Fiscal Year Ended |    
|                               |                                                  |                   |    
|                               |                                                  | December 30,      |     |     | December 28, |  |     | January 3, |  
|                               |                                                  | 2003              |     |     | 2004         |  |     | 2006       |  
|                               |                                                  |                   |     |     |              |  |     |            |  
|Statutory rate                 |                                                  |                   | (34 | )%  |              |  | 34  | %          |   |  | (34 | )%
|Differences:                   |                                                  |                   |     |     |              |  |     |            |   |  |     |   
|                               | State income taxes                               |                   |     | (4  | )            |  |     | 20         |   |  |     | (6 | )
|                               | Nondeductible expenses (meals and entertainment) |                   |     | 1   |              |  |     | 9          |   |  |     | 1  |  
|                               | Adjustment to valuation allowance                |                   |     | (9  | )            |  |     |            |   |  |     |    |  
|                               | Non-cash interest expense                        |                   |     |    |              |  |     | 51         |   |  |     |   |  
|                               | Federal tax credits                              |                   |     | (13 | )            |  |     | (143       | ) |  |     | (4 | )
|                               | Reserve for tax audit                            |                   |     |    |              |  |     | (44        | ) |  |     |    |  
|                               | Change in effective state tax rate               |                   |     |     |              |  |     |            |   |  |     | (4 | )
|                               | Other                                            |                   |     | (1  | )            |  |     |           |   |  |     | 1  |  
|                               |                                                  |                   |     |     |              |  |     |            |  
|Total benefit for income taxes |                                                  |                   | (59 | )%  |              |  | (73 | )%         |   |  | (46 | )%
|                               |                                                  |                   |     |     |              |  |     |            |  



F-19



---



##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                    
|-- | -------------------
|6. | EQUITY TRANSACTIONS

Non-cash Compensation




|   |                                    
|-- | -----------------------------------
|7. | FAIR VALUE OF FINANCIAL INSTRUMENTS



Long-Term Debt


|                    |                     |                       |   |     |      |   |   |      |      |   |      |     |      |      |   |     |            |   |   |       |      |   |   |       |       |   |   |       |   | 
|------------------- | ------------------- | --------------------- | - | --- | ---- | - | - | ---- | ---- | - | ---- | --- | ---- | ---- | - | --- | ---------- | - | - | ----- | ---- | - | - | ----- | ----- | - | - | ----- | - | 
|                    |                     | 2006                  |   |     | 2007 |   |   | 2008 |      |   | 2009 |     |      | 2010 |   |     | Thereafter |   |   | Total |     
|                    |                     |                       |   |     |      |   |   |      |      |   |      |     |      |      |   |     |            |   |   |       |     
|                    |                     | (Dollars in millions) |  
|Long term debt:     |                     |                       |   |     |      |   |   |      |      |   |      |     |      |      |   |     |            |   |   |       |      |   |   |       |       |   |   |      
|Fixed rate debt:    |                     |                       |   |     |      |   |   |      |      |   |      |     |      |      |   |     |            |   |   |       |      |   |   |       |       |   |   |      
|                    | Represented by IDSs |                       |   |    |      |   |   |     |      |   |      |    |      |      |   |    |            |   |   |      |      |   | $ | 105.2 |       |   | $ | 105.2 |  
|                    |                     | Average interest rate |   |     |     |   |   |      |     |   |      |     |     |      |   |     |           |   |   |       |     |   |   |       | 13.50 | % |   |       |  | 
|Variable rate debt: |                     |                       |   |     |      |   |   |      |      |   |      |     |      |      |   |     |            |   |   |       |      |   |   |       |       |   |   |      
|                    | Term Loans          |                       | $ | 1.1 |      |   | $ | 1.1  |      |   | $    | 1.1 |      |      | $ | 1.1 |            |   | $ | 102.3 |      |   |   |      |       |   | $ | 106.7 |  
|                    |                     | Average interest rate |   |     | 8.29 | % |   |      | 8.40 | % |      |     | 8.40 | %    |   |     | 8.40       | % |   |       | 8.40 | % |   |       |      |   |   |       |  | 

Current Assets and Current Liabilities




|   |                              
|-- | -----------------------------
|8. | COMMITMENTS AND CONTINGENCIES

Leases and Client Contracts


month-to


F-20



---



##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






|           |  |                |       |  |               |   |        | 
|---------- |  | -------------- | ----- |  | ------------- | - | ------ | 
|           |  | Operating      |       |  | Commissions   |  
|Year       |  | Leases         |       |  | and Royalties |  
|           |  |                |       |  |               |  
|           |  | (In thousands) |      
|2006       |  | $              | 745   |  |               | $ | 8,422  | 
|2007       |  |                | 463   |  |               |   | 5,857  | 
|2008       |  |                | 280   |  |               |   | 5,701  | 
|2009       |  |                | 89    |  |               |   | 5,630  | 
|2010       |  |                |      |  |               |   | 4,413  | 
|Thereafter |  |                |      |  |               |   | 17,673 | 
|           |  |                |       |  |               |  
|Total      |  | $              | 1,577 |  |               | $ | 47,696 | 
|           |  |                |       |  |               |  

Employment Contracts


Commitments






|          |  |                |       |  |      |   |       |      |  |   |       |  |  |      |     |  |            |   |     |       |  |   |     |  |  |   |       | 
|--------- |  | -------------- | ----- |  | ---- | - | ----- | ---- |  | - | ----- |  |  | ---- | --- |  | ---------- | - | --- | ----- |  | - | --- |  |  | - | ----- | 
|          |  | 2006           |       |  | 2007 |   |       | 2008 |  |   | 2009  |  |  | 2010 |     |  | Thereafter |   |     | Total | 
|          |  |                |       |  |      |   |       |      |  |   |       |  |  |      |     |  |            |   |     |       | 
|          |  | (In thousands) |      
|Insurance |  |                | 1,984 |  |      |   | 1,611 |      |  |   | 1,321 |  |  |      | 436 |  |            |   | 260 |       |  |   | 262 |  |  |   | 5,874 | 
|Other     |  |                | 50    |  |      |   | 230   |      |  |   | 148   |  |  |      | 41  |  |            |   | 41  |       |  |   | 0   |  |  |   | 510   | 
|          |  |                |       |  |      |   |       |      |  |   |       |  |  |      |     |  |            |   |     |       | 
|Total     |  | $              | 2,034 |  |      | $ | 1,841 |      |  | $ | 1,469 |  |  | $    | 477 |  |            | $ | 260 |       |  | $ | 262 |  |  | $ | 6,384 | 
|          |  |                |       |  |      |   |       |      |  |   |       |  |  |      |     |  |            |   |     |       | 

Litigation


F-21



---



##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




Cooper Industries, Inc. v. Aviall Services




clean-up


10-K, Holden v. Volume
Services America, Inc. et al.


Perez v. Volume Services Inc, d/b/a Centerplate, Perez Holden. Holden. Holden Perez Holden


F-22



---



##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






|   |                           
|-- | --------------------------
|9. | RELATED PARTY TRANSACTIONS

Management Fees




Leasing Services


Credit Agreement




|    |              
|--- | -------------
|10. | BENEFIT PLANS



Multi-Employer Pension Plans


Annual Bonus Plan


F-23



---



##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




Long-Term Performance Plan








|    |                        
|--- | -----------------------
|11. | DEMAND FOR REGISTRATION





|    |                  
|--- | -----------------
|12. | SUBSEQUENT EVENTS





F-24



---



##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|    |                                            
|--- | -------------------------------------------
|13. | QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)



|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |         |   |  |   |         |  
|-------------------------------------------------------------------------------------------- |  | ------------------------------------- | ------- | - | ------- | - | ------- | ------- |  | - | ------- | - |  | ----- | ------- | - |  | - | ------- | -
|                                                                                             |  | First                                 |         |   | Second  |   |         | Third   |  |   | Fourth  |   |  |      
|Year Ended December 28, 2004                                                                 |  | Quarter                               |         |   | Quarter |   |         | Quarter |  |   | Quarter |   |  | Total |        
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        
|                                                                                             |  | (In thousands, except per share data) |        
|Net sales                                                                                    |  | $                                     | 98,236  |   |         | $ | 173,725 |         |  | $ | 201,066 |   |  | $     | 134,127 |   |  | $ | 607,154 |  
|Cost of sales                                                                                |  |                                       | 82,147  |   |         |   | 140,546 |         |  |   | 161,933 |   |  |       | 107,836 |   |  |   | 492,462 |  
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        
|Gross profit                                                                                 |  |                                       | 16,089  |   |         |   | 33,179  |         |  |   | 39,133  |   |  |       | 26,291  |   |  |   | 114,692 |  
|Selling, general, and administrative                                                         |  |                                       | 13,547  |   |         |   | 15,596  |         |  |   | 17,514  |   |  |       | 14,883  |   |  |   | 61,540  |  
|Depreciation and amortization                                                                |  |                                       | 6,878   |   |         |   | 6,601   |         |  |   | 6,656   |   |  |       | 6,509   |   |  |   | 26,644  |  
|Contract related losses                                                                      |  |                                       |        |   |         |   | 121     |         |  |   |        |   |  |       | 290     |   |  |   | 411     |  
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        
|Operating income (loss)                                                                      |  |                                       | (4,336  | ) |         |   | 10,861  |         |  |   | 14,963  |   |  |       | 4,609   |   |  |   | 26,097  |  
|Interest expense, net                                                                        |  |                                       | 6,976   |   |         |   | 7,052   |         |  |   | 4,759   |   |  |       | 6,223   |   |  |   | 25,010  |  
|Other income, net                                                                            |  |                                       | (57     | ) |         |   | (38     | )       |  |   | (75     | ) |  |       | (96     | ) |  |   | (266    | )
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        
|Income (loss) before income taxes                                                            |  |                                       | (11,255 | ) |         |   | 3,847   |         |  |   | 10,279  |   |  |       | (1,518  | ) |  |   | 1,353   |  
|Income tax provision (benefit)                                                               |  |                                       | (2,078  | ) |         |   | (1,547  | )       |  |   | 4,546   |   |  |       | (1,888  | ) |  |   | (967    | )
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        
|Net income (loss)                                                                            |  |                                       | (9,177  | ) |         |   | 5,394   |         |  |   | 5,733   |   |  |       | 370     |   |  |   | 2,320   |  
|Accretion of conversion option                                                               |  |                                       | (175    | ) |         |   | (142    | )       |  |   |        |   |  |       |        |   |  |   | (317    | )
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        
|Net income (loss) available to common stockholders with or
    without the conversion option |  | $                                     | (9,352  | ) |         | $ | 5,252   |         |  | $ | 5,733   |   |  | $     | 370     |   |  | $ | 2,003   |  
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        
|Basic and Diluted Net Income (Loss) per share with conversion
    option                     |  | $                                     | (0.37   | ) |         | $ | 0.27    |         |  | $ | 0.25    |   |  | $     | 0.02    |   |  | $ | 0.17    |  
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        
|Basic and Diluted Net Income (Loss) per share without conversion
    option                  |  | $                                     | (0.42   | ) |         | $ | 0.23    |         |  | $ | 0.25    |   |  | $     | 0.02    |   |  | $ | 0.09    |  
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        

F-25



---



##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |         |   |  |   |         |  
|-------------------------------------------------------------------------------------------- |  | ------------------------------------- | ------- | - | ------- | - | ------- | ------- |  | - | ------- | - |  | ----- | ------- | - |  | - | ------- | -
|                                                                                             |  | First                                 |         |   | Second  |   |         | Third   |  |   | Fourth  |   |  |      
|Year Ended January 3, 2006                                                                   |  | Quarter                               |         |   | Quarter |   |         | Quarter |  |   | Quarter |   |  | Total |        
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        
|                                                                                             |  | (In thousands, except per share data) |        
|Net sales                                                                                    |  | $                                     | 107,220 |   |         | $ | 182,071 |         |  | $ | 208,619 |   |  | $     | 145,202 |   |  | $ | 643,112 |  
|Cost of sales                                                                                |  |                                       | 89,031  |   |         |   | 146,410 |         |  |   | 166,297 |   |  |       | 117,657 |   |  |   | 519,395 |  
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        
|Gross profit                                                                                 |  |                                       | 18,189  |   |         |   | 35,661  |         |  |   | 42,322  |   |  |       | 27,545  |   |  |   | 123,717 |  
|Selling, general, and administrative                                                         |  |                                       | 15,766  |   |         |   | 17,884  |         |  |   | 19,738  |   |  |       | 18,017  |   |  |   | 71,405  |  
|Depreciation and amortization                                                                |  |                                       | 6,805   |   |         |   | 7,296   |         |  |   | 7,332   |   |  |       | 7,822   |   |  |   | 29,255  |  
|Transaction related expenses(1)                                                              |  |                                       |        |   |         |   |        |         |  |   |        |   |  |       | 1,006   |   |  |   | 1,006   |  
|Contract related losses                                                                      |  |                                       |        |   |         |   |        |         |  |   | 280     |   |  |       | 89      |   |  |   | 369     |  
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        
|Operating income (loss)                                                                      |  |                                       | (4,382  | ) |         |   | 10,481  |         |  |   | 14,972  |   |  |       | 611     |   |  |   | 21,682  |  
|Interest expense, net(2)                                                                     |  |                                       | 5,400   |   |         |   | 13,123  |         |  |   | 6,955   |   |  |       | 5,796   |   |  |   | 31,274  |  
|Other income, net                                                                            |  |                                       | (86     | ) |         |   | (219    | )       |  |   | (322    | ) |  |       | (524    | ) |  |   | (1,151  | )
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        
|Income (loss) before income taxes                                                            |  |                                       | (9,696  | ) |         |   | (2,423  | )       |  |   | 8,339   |   |  |       | (4,661  | ) |  |   | (8,441  | )
|Income tax provision (benefit)                                                               |  |                                       | (5,263  | ) |         |   | 50      |         |  |   | 3,827   |   |  |       | (2,467  | ) |  |   | (3,853  | )
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        
|Net income (loss)                                                                            |  |                                       | (4,433  | ) |         |   | (2,473  | )       |  |   | 4,512   |   |  |       | (2,194  | ) |  |   | (4,588  | )
|Accretion of conversion option                                                               |  |                                       |        |   |         |   |        |         |  |   |        |   |  |       |        |   |  |   |        |  
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        
|Net income (loss) available to common stockholders with or
    without the conversion option |  | $                                     | (4,433  | ) |         | $ | (2,473  | )       |  | $ | 4,512   |   |  | $     | (2,194  | ) |  | $ | (4,588  | )
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        
|Basic and Diluted Net Income (Loss) per share with conversion
    option                     |  | $                                     | (0.20   | ) |         | $ | (0.11   | )       |  | $ | 0.20    |   |  | $     | (0.10   | ) |  | $ | (0.20   | )
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        
|Basic and Diluted Net Income (Loss) per share without conversion
    option                  |  | $                                     | (0.20   | ) |         | $ | (0.11   | )       |  | $ | 0.20    |   |  | $     | (0.10   | ) |  | $ | (0.20   | )
|                                                                                             |  |                                       |         |   |         |   |         |         |  |   |         |   |  |       |        






|    |                                                                                                                                                    
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Reflects the write-off of costs associated with a contemplated
    follow-on offering to the Companys 2003 IPO.                                   
|   
|(2) | Included in interest expense in the second quarter is
    $5.8 million in expenses related to refinancing the
    Companys senior credit facility.

F-26



---



##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|    |                                                
|--- | -----------------------------------------------
|14. | NON-GUARANTOR SUBSIDIARIES FINANCIAL STATEMENTS

non-U.S.




| |                                                                                                                      
| | ---------------------------------------------------------------------------------------------------------------------
| | Consolidating Condensed Statement of Operations and
    Comprehensive Income (Loss), Year Ended December 30,
    2003

|                                                                       |  |                |        |           |              |   |               |              |  |   |              |   |  |              |       |  |  |   |         |  
|---------------------------------------------------------------------- |  | -------------- | ------ | --------- | ------------ | - | ------------- | ------------ |  | - | ------------ | - |  | ------------ | ----- |  |  | - | ------- | -
|                                                                       |  |                |        | Combined  |              |   | Combined      |              |  |   |              |  
|                                                                       |  |                |        | Guarantor |              |   | Non-guarantor |              |  |   |              |  
|                                                                       |  | Centerplate    |        |           | Subsidiaries |   |               | Subsidiaries |  |   | Eliminations |   |  | Consolidated |      
|                                                                       |  |                |        |           |              |   |               |              |  |   |              |   |  |              |      
|                                                                       |  | (In thousands) |       
|Net sales                                                              |  | $              |       |           |              | $ | 579,329       |              |  | $ | 36,728       |   |  | $            |      |  |  | $ | 616,057 |  
|Cost of sales                                                          |  |                |       |           |              |   | 472,706       |              |  |   | 31,280       |   |  |              |      |  |  |   | 503,986 |  
|Selling, general, and administrative                                   |  |                | 57     |           |              |   | 55,653        |              |  |   | 3,881        |   |  |              |      |  |  |   | 59,591  |  
|Depreciation and amortization                                          |  |                | 116    |           |              |   | 26,192        |              |  |   | 811          |   |  |              |      |  |  |   | 27,119  |  
|Transaction related expenses                                           |  |                |       |           |              |   | 2,577         |              |  |   |             |   |  |              |      |  |  |   | 2,577   |  
|Contract related losses                                                |  |                |       |           |              |   | 647           |              |  |   | 184          |   |  |              |      |  |  |   | 831     |  
|                                                                       |  |                |        |           |              |   |               |              |  |   |              |   |  |              |      
|Operating income (loss)                                                |  |                | (173   | )         |              |   | 21,554        |              |  |   | 572          |   |  |              |      |  |  |   | 21,953  |  
|Interest expense                                                       |  |                | 42     |           |              |   | 32,721        |              |  |   |             |   |  |              |      |  |  |   | 32,763  |  
|Other income, net                                                      |  |                | (4     | )         |              |   | (43           | )            |  |   | (8           | ) |  |              |      |  |  |   | (55     | )
|                                                                       |  |                |        |           |              |   |               |              |  |   |              |   |  |              |      
|Income (loss) before income taxes                                      |  |                | (211   | )         |              |   | (11,124       | )            |  |   | 580          |   |  |              |      |  |  |   | (10,755 | )
|Income tax provision (benefit)                                         |  |                | 586    |           |              |   | (6,927        | )            |  |   | 4            |   |  |              |      |  |  |   | (6,337  | )
|Equity in earnings of subsidiaries                                     |  |                | (3,621 | )         |              |   |              |              |  |   |             |   |  |              | 3,621 |  |  |   |        |  
|                                                                       |  |                |        |           |              |   |               |              |  |   |              |   |  |              |      
|Net income (loss)                                                      |  |                | (4,418 | )         |              |   | (4,197        | )            |  |   | 576          |   |  |              | 3,621 |  |  |   | (4,418  | )
|Other comprehensive income foreign currency translation
    adjustment |  |                |       |           |              |   |              |              |  |   | 668          |   |  |              |      |  |  |   | 668     |  
|                                                                       |  |                |        |           |              |   |               |              |  |   |              |   |  |              |      
|Comprehensive income (loss)                                            |  | $              | (4,418 | )         |              | $ | (4,197        | )            |  | $ | 1,244        |   |  | $            | 3,621 |  |  | $ | (3,750  | )
|                                                                       |  |                |        |           |              |   |               |              |  |   |              |   |  |              |      

F-27



---



##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |                                                                                  
| | ---------------------------------------------------------------------------------
| | Consolidating Condensed Statement of Cash Flows, Year
    Ended December 30, 2003

|                                      |                                              |                                                     |     |           |              |   |               |              |         |   |              |        |        |   |        |          |         |  
|------------------------------------- | -------------------------------------------- | --------------------------------------------------- | --- | --------- | ------------ | - | ------------- | ------------ | ------- | - | ------------ | ------ | ------ | - | ------ | -------- | ------- | -
|                                      |                                              |                                                     |     | Combined  |              |   | Combined      |              |         |  
|                                      |                                              |                                                     |     | Guarantor |              |   | Non-guarantor |              |         |  
|                                      |                                              | Centerplate                                         |     |           | Subsidiaries |   |               | Subsidiaries |         |   | Consolidated |       
|                                      |                                              |                                                     |     |           |              |   |               |              |         |   |              |       
|                                      |                                              | (In thousands)                                      |    
|Cash flows from operating activities  |                                              | $                                                   | 852 |           |              | $ | 24,877        |              |         | $ | 1,430        |        |        | $ | 27,159 |         
|                                      |                                              |                                                     |     |           |              |   |               |              |         |   |              |       
|Cash flows from investing activities: |                                              |                                                     |     |           |              |   |               |              |         |   |              |        |        |   |        |         
|                                      | Purchase of property and equipment           |                                                     |     |          |              |   |               | (6,507       | )       |   |              | (1,397 | )      |   |        | (7,904   | )      
|                                      | Proceeds from sale of property and equipment |                                                     |     |          |              |   |               | 585          |         |   |              |       |        |   |        | 585      |        
|                                      | Purchase of contract rights                  |                                                     |     |           |              |   |               | (16,029      | )       |   |              |       |        |   |        | (16,029  | )      
|                                      | Restricted cash                              |                                                     |     |          |              |   |               | (22,048      | )       |   |              |       |        |   |        | (22,048  | )      
|                                      |                                              |                                                     |     |           |              |   |               |              |         |   |              |       
|                                      |                                              | Net cash used in investing activities               |     |           |             |   |               |              | (43,999 | ) |              |        | (1,397 | ) |        |          | (45,396 | )
|                                      |                                              |                                                     |     |           |              |   |               |              |         |   |              |       
|Cash flows from financing activities: |                                              |                                                     |     |           |              |   |               |              |         |   |              |        |        |   |        |         
|                                      | Net payments  revolving loans               |                                                     |     |          |              |   |               | (11,000      | )       |   |              |       |        |   |        | (11,000  | )      
|                                      | Principal payments on long-term debt         |                                                     |     |          |              |   |               | (110,400     | )       |   |              |       |        |   |        | (110,400 | )      
|                                      | Proceeds from issuance of long-term debt     |                                                     |     |          |              |   |               | 65,000       |         |   |              |       |        |   |        | 65,000   |        
|                                      | Proceeds from issuance of stock, net         |                                                     |     | 151,517   |              |   |               |             |         |   |              |       |        |   |        | 151,517  |        
|                                      | Proceeds from issuance of subordinated notes |                                                     |     | 105,245   |              |   |               |             |         |   |              |       |        |   |        | 105,245  |        
|                                      | Payment of existing subordinated notes       |                                                     |     |          |              |   |               | (87,750      | )       |   |              |       |        |   |        | (87,750  | )      
|                                      | Repurchase of common stock                   |                                                     |     | (71,440   | )            |   |               |             |         |   |              |       |        |   |        | (71,440  | )      
|                                      | Proceeds from loans to related parties       |                                                     |     | 1,241     |              |   |               |             |         |   |              |       |        |   |        | 1,241    |        
|                                      | Payment of debt issuance costs               |                                                     |     | (11,417   | )            |   |               | (1,420       | )       |   |              |       |        |   |        | (12,837  | )      
|                                      | Increase in bank overdrafts                  |                                                     |     |          |              |   |               | 1,282        |         |   |              |       |        |   |        | 1,282    |        
|                                      | Loans to related parties                     |                                                     |     | (66       | )            |   |               |             |         |   |              |       |        |   |        | (66      | )      
|                                      | Change in intercompany, net                  |                                                     |     | (175,928  | )            |   |               | 175,952      |         |   |              | (24    | )      |   |        |         |        
|                                      |                                              |                                                     |     |           |              |   |               |              |         |   |              |       
|                                      |                                              | Net cash provided by (used in) financing activities |     |           | (848         | ) |               |              | 31,664  |   |              |        | (24    | ) |        |          | 30,792  |  
|                                      |                                              |                                                     |     |           |              |   |               |              |         |   |              |       
|Increase in cash                      |                                              |                                                     | 4   |           |              |   | 12,542        |              |         |   | 9            |        |        |   | 12,555 |         
|Cash and cash equivalents:            |                                              |                                                     |     |           |              |   |               |              |         |   |              |        |        |   |        |         
|                                      | Beginning of year                            |                                                     |     | 188       |              |   |               | 9,962        |         |   |              | 224    |        |   |        | 10,374   |        
|                                      |                                              |                                                     |     |           |              |   |               |              |         |   |              |       
|                                      | End of year                                  |                                                     | $   | 192       |              |   | $             | 22,504       |         |   | $            | 233    |        |   | $      | 22,929   |        
|                                      |                                              |                                                     |     |           |              |   |               |              |         |   |              |       

F-28



---



##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |                                                             
| | ------------------------------------------------------------
| | Consolidating Condensed Balance Sheet, December 28,
    2004

|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |       |       |       |   |         |          |         | 
|------------------------------------------------------------------------------------------------------------ | -------------------------- | --------------------------------------- | ------- | --------- | ------------ | - | ------------- | ------------ | ------- | - | ------------ | ----- | ----- | ------------ | ----- | ----- | ----- | - | ------- | -------- | ------- | 
|                                                                                                             |                            |                                         |         | Combined  |              |   | Combined      |              |         |   |              |      
|                                                                                                             |                            |                                         |         | Guarantor |              |   | Non-guarantor |              |         |   |              |      
|                                                                                                             |                            | Centerplate                             |         |           | Subsidiaries |   |               | Subsidiaries |         |   | Eliminations |       |       | Consolidated |      
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      
|                                                                                                             |                            | (In thousands)                          |        
|ASSETS                                                                                                      
|Current assets:                                                                                              |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |       |       |       |   |         |         
|                                                                                                             | Cash and cash equivalents  |                                         | $       | 195       |              |   | $             | 24,142       |         |   | $            | 440   |       |              | $     |      |       |   | $       | 24,777   |        
|                                                                                                             | Accounts receivable        |                                         |         |          |              |   |               | 19,840       |         |   |              | 2,036 |       |              |       |      |       |   |         | 21,876   |        
|                                                                                                             | Other current assets       |                                         |         | 7         |              |   |               | 23,724       |         |   |              | 1,371 |       |              |       |      |       |   |         | 25,102   |        
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      
|                                                                                                             |                            | Total current assets                    |         |           | 202          |   |               |              | 67,706  |   |              |       | 3,847 |              |       |       |      |   |         |          | 71,755  | 
|Property and equipment                                                                                       |                            |                                         |        |           |              |   | 44,591        |              |         |   | 3,631        |       |       |              |      |       |       |   | 48,222  |         
|Contract rights, net                                                                                         |                            |                                         | 253     |           |              |   | 86,908        |              |         |   | 820          |       |       |              |      |       |       |   | 87,981  |         
|Cost in excess of net assets acquired, net                                                                   |                            |                                         | 6,974   |           |              |   | 34,168        |              |         |   |             |       |       |              |      |       |       |   | 41,142  |         
|Intercompany receivable (payable)                                                                            |                            |                                         | 152,899 |           |              |   | (147,525      | )            |         |   | (5,374       | )     |       |              |      |       |       |   |        |         
|Investment in subsidiaries                                                                                   |                            |                                         | (5,712  | )         |              |   |              |              |         |   |             |       |       |              | 5,712 |       |       |   |        |         
|Other assets                                                                                                 |                            |                                         | 9,462   |           |              |   | 39,567        |              |         |   | 917          |       |       |              |      |       |       |   | 49,946  |         
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      
|Total assets                                                                                                 |                            | $                                       | 164,078 |           |              | $ | 125,415       |              |         | $ | 3,841        |       |       | $            | 5,712 |       |       | $ | 299,046 |         
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      
|                                                                                                            
|LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIENCY)                                                           
|Current liabilities                                                                                          |                            | $                                       | 6,607   |           |              | $ | 60,669        |              |         | $ | 2,967        |       |       | $            |      |       |       | $ | 70,243  |         
|Long-term debt                                                                                               |                            |                                         | 105,245 |           |              |   | 65,000        |              |         |   |             |       |       |              |      |       |       |   | 170,245 |         
|Other liabilities                                                                                            |                            |                                         |        |           |              |   | 6,332         |              |         |   |             |       |       |              |      |       |       |   | 6,332   |         
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      
|                                                                                                             |                            | Total liabilities                       |         |           | 111,852      |   |               |              | 132,001 |   |              |       | 2,967 |              |       |       |      |   |         |          | 246,820 | 
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      
|Common stock with conversion option, par value $0.01
    exchangeable for subordinated debt, net of discount |                            |                                         | 14,352  |           |              |   |              |              |         |   |             |       |       |              |      |       |       |   | 14,352  |         
|Stockholders equity (deficiency):                                                                           |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |       |       |       |   |         |         
|                                                                                                             | Common stock               |                                         |         | 400       |              |   |               |             |         |   |              |      |       |              |       |      |       |   |         | 400      |        
|                                                                                                             | Additional paid-in capital |                                         |         | 218,331   |              |   |               |             |         |   |              |      |       |              |       |      |       |   |         | 218,331  |        
|                                                                                                             | Accumulated deficit        |                                         |         | (60,492   | )            |   |               | (6,586       | )       |   |              | 299   |       |              |       | 6,287 |       |   |         | (60,492  | )      
|                                                                                                             | Treasury stock and other   |                                         |         | (120,365  | )            |   |               |             |         |   |              | 575   |       |              |       | (575  | )     |   |         | (120,365 | )      
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      
|                                                                                                             |                            | Total stockholders equity (deficiency) |         |           | 37,874       |   |               |              | (6,586  | ) |              |       | 874   |              |       |       | 5,712 |   |         |          | 37,874  | 
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      
|Total liabilities and stockholders equity (deficiency)                                                      |                            | $                                       | 164,078 |           |              | $ | 125,415       |              |         | $ | 3,841        |       |       | $            | 5,712 |       |       | $ | 299,046 |         
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      

F-29



---



##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |                                                                                                           
| | ----------------------------------------------------------------------------------------------------------
| | Consolidating Condensed Statement of Operations and
    Comprehensive Income, Year Ended December 28, 2004

|                                                                           |  |                |         |           |              |   |               |              |  |   |              |   |  |              |        |   |  |   |         |  
|-------------------------------------------------------------------------- |  | -------------- | ------- | --------- | ------------ | - | ------------- | ------------ |  | - | ------------ | - |  | ------------ | ------ | - |  | - | ------- | -
|                                                                           |  |                |         | Combined  |              |   | Combined      |              |  |   |              |  
|                                                                           |  |                |         | Guarantor |              |   | Non-guarantor |              |  |   |              |  
|                                                                           |  | Centerplate    |         |           | Subsidiaries |   |               | Subsidiaries |  |   | Eliminations |   |  | Consolidated |       
|                                                                           |  |                |         |           |              |   |               |              |  |   |              |   |  |              |       
|                                                                           |  | (In thousands) |        
|Net sales                                                                  |  | $              |        |           |              | $ | 566,653       |              |  | $ | 40,501       |   |  | $            |       |   |  | $ | 607,154 |  
|Cost of sales                                                              |  |                |        |           |              |   | 458,692       |              |  |   | 33,770       |   |  |              |       |   |  |   | 492,462 |  
|Selling, general, and administrative                                       |  |                | 1,184   |           |              |   | 55,294        |              |  |   | 5,062        |   |  |              |       |   |  |   | 61,540  |  
|Depreciation and amortization                                              |  |                | 109     |           |              |   | 25,484        |              |  |   | 1,051        |   |  |              |       |   |  |   | 26,644  |  
|Contract related losses                                                    |  |                |        |           |              |   | 411           |              |  |   |             |   |  |              |       |   |  |   | 411     |  
|                                                                           |  |                |         |           |              |   |               |              |  |   |              |   |  |              |       
|Operating income (loss)                                                    |  |                | (1,293  | )         |              |   | 26,772        |              |  |   | 618          |   |  |              |       |   |  |   | 26,097  |  
|Interest expense                                                           |  |                | 17,408  |           |              |   | 7,602         |              |  |   |             |   |  |              |       |   |  |   | 25,010  |  
|Intercompany interest, net                                                 |  |                | (15,611 | )         |              |   | 15,611        |              |  |   |             |   |  |              |       |   |  |   |        |  
|Other income, net                                                          |  |                | (4      | )         |              |   | (258          | )            |  |   | (4           | ) |  |              |       |   |  |   | (266    | )
|                                                                           |  |                |         |           |              |   |               |              |  |   |              |   |  |              |       
|Income (loss) before income taxes                                          |  |                | (3,086  | )         |              |   | 3,817         |              |  |   | 622          |   |  |              |       |   |  |   | 1,353   |  
|Income tax benefit                                                         |  |                | (945    | )         |              |   | (22           | )            |  |   |             |   |  |              |       |   |  |   | (967    | )
|Equity in earnings of subsidiaries                                         |  |                | 4,461   |           |              |   |              |              |  |   |             |   |  |              | (4,461 | ) |  |   |        |  
|                                                                           |  |                |         |           |              |   |               |              |  |   |              |   |  |              |       
|Net income                                                                 |  |                | 2,320   |           |              |   | 3,839         |              |  |   | 622          |   |  |              | (4,461 | ) |  |   | 2,320   |  
|Accretion of conversion option                                             |  |                | (317    | )         |              |   |              |              |  |   |             |   |  |              |       |   |  |   | (317    | )
|                                                                           |  |                |         |           |              |   |               |              |  |   |              |   |  |              |       
|Net income available to common stock with or without conversion
    option |  | $              | 2,003   |           |              | $ | 3,839         |              |  | $ | 622          |   |  | $            | (4,461 | ) |  | $ | 2,003   |  
|                                                                           |  |                |         |           |              |   |               |              |  |   |              |   |  |              |       
|Net income                                                                 |  |                | 2,320   |           |              |   | 3,839         |              |  |   | 622          |   |  |              | (4,461 | ) |  |   | 2,320   |  
|Other comprehensive income foreign currency translation
    adjustment     |  |                |        |           |              |   |              |              |  |   | 351          |   |  |              |       |   |  |   | 351     |  
|                                                                           |  |                |         |           |              |   |               |              |  |   |              |   |  |              |       
|Comprehensive income                                                       |  | $              | 2,320   |           |              | $ | 3,839         |              |  | $ | 973          |   |  | $            | (4,461 | ) |  | $ | 2,671   |  
|                                                                           |  |                |         |           |              |   |               |              |  |   |              |   |  |              |       

F-30



---



##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |                                                                                  
| | ---------------------------------------------------------------------------------
| | Consolidating Condensed Statement of Cash Flows, Year
    Ended December 28, 2004

|                                                      |                                              |                                                     |      |           |              |   |               |              |         |   |              |        |        |   |        |         |         |  
|----------------------------------------------------- | -------------------------------------------- | --------------------------------------------------- | ---- | --------- | ------------ | - | ------------- | ------------ | ------- | - | ------------ | ------ | ------ | - | ------ | ------- | ------- | -
|                                                      |                                              |                                                     |      | Combined  |              |   | Combined      |              |         |  
|                                                      |                                              |                                                     |      | Guarantor |              |   | Non-guarantor |              |         |  
|                                                      |                                              | Centerplate                                         |      |           | Subsidiaries |   |               | Subsidiaries |         |   | Consolidated |       
|                                                      |                                              |                                                     |      |           |              |   |               |              |         |   |              |       
|                                                      |                                              | (In thousands)                                      |     
|Cash flows Provided by (used in) operating activities |                                              | $                                                   | (456 | )         |              | $ | 25,916        |              |         | $ | 2,979        |        |        | $ | 28,439 |        
|                                                      |                                              |                                                     |      |           |              |   |               |              |         |   |              |       
|Cash flows from investing activities:                 |                                              |                                                     |      |           |              |   |               |              |         |   |              |        |        |   |        |        
|                                                      | Purchase of property and equipment           |                                                     |      |          |              |   |               | (6,987       | )       |   |              | (982   | )      |   |        | (7,969  | )      
|                                                      | Proceeds from sale of property and equipment |                                                     |      |          |              |   |               | 702          |         |   |              | 107    |        |   |        | 809     |        
|                                                      | Contract rights acquired, net                |                                                     |      |          |              |   |               | (15,900      | )       |   |              |       |        |   |        | (15,900 | )      
|                                                      | Return of unamortized capital investment     |                                                     |      |          |              |   |               | 16,531       |         |   |              |       |        |   |        | 16,531  |        
|                                                      | Restricted cash                              |                                                     |      |          |              |   |               | 13,628       |         |   |              |       |        |   |        | 13,628  |        
|                                                      |                                              |                                                     |      |           |              |   |               |              |         |   |              |       
|                                                      |                                              | Net cash provided by (used in) investing activities |      |           |             |   |               |              | 7,974   |   |              |        | (875   | ) |        |         | 7,099   |  
|                                                      |                                              |                                                     |      |           |              |   |               |              |         |   |              |       
|Cash flows from financing activities:                 |                                              |                                                     |      |           |              |   |               |              |         |   |              |        |        |   |        |        
|                                                      | Net repayments  revolving loans             |                                                     |      |          |              |   |               | (4,000       | )       |   |              |       |        |   |        | (4,000  | )      
|                                                      | Payment of existing subordinated notes       |                                                     |      |          |              |   |               | (12,250      | )       |   |              |       |        |   |        | (12,250 | )      
|                                                      | Payment of debt issuance costs               |                                                     |      | (267      | )            |   |               |             |         |   |              |       |        |   |        | (267    | )      
|                                                      | Payments of financing costs                  |                                                     |      | (263      | )            |   |               | (241         | )       |   |              |       |        |   |        | (504    | )      
|                                                      | Increase in bank overdrafts                  |                                                     |      |          |              |   |               | 1,666        |         |   |              |       |        |   |        | 1,666   |        
|                                                      | Dividend payments                            |                                                     |      | (18,335   | )            |   |               |             |         |   |              |       |        |   |        | (18,335 | )      
|                                                      | Change in intercompany, net                  |                                                     |      | 19,324    |              |   |               | (17,427      | )       |   |              | (1,897 | )      |   |        |        |        
|                                                      |                                              |                                                     |      |           |              |   |               |              |         |   |              |       
|                                                      |                                              | Net cash provided by (used in) financing activities |      |           | 459          |   |               |              | (32,252 | ) |              |        | (1,897 | ) |        |         | (33,690 | )
|                                                      |                                              |                                                     |      |           |              |   |               |              |         |   |              |       
|Increase in cash                                      |                                              |                                                     | 3    |           |              |   | 1,638         |              |         |   | 207          |        |        |   | 1,848  |        
|Cash and cash equivalents:                            |                                              |                                                     |      |           |              |   |               |              |         |   |              |        |        |   |        |        
|                                                      | Beginning of year                            |                                                     |      | 192       |              |   |               | 22,504       |         |   |              | 233    |        |   |        | 22,929  |        
|                                                      |                                              |                                                     |      |           |              |   |               |              |         |   |              |       
|                                                      | End of year                                  |                                                     | $    | 195       |              |   | $             | 24,142       |         |   | $            | 440    |        |   | $      | 24,777  |        
|                                                      |                                              |                                                     |      |           |              |   |               |              |         |   |              |       

F-31



---



##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |                                                           
| | ----------------------------------------------------------
| | Consolidating Condensed Balance Sheet, January 3,
    2006

|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |       |       |       |   |         |          |         | 
|------------------------------------------------------------------------------------------------------------ | -------------------------- | --------------------------------------- | ------- | --------- | ------------ | - | ------------- | ------------ | ------- | - | ------------ | ----- | ----- | ------------ | ----- | ----- | ----- | - | ------- | -------- | ------- | 
|                                                                                                             |                            |                                         |         | Combined  |              |   | Combined      |              |         |   |              |      
|                                                                                                             |                            |                                         |         | Guarantor |              |   | Non-guarantor |              |         |   |              |      
|                                                                                                             |                            | Centerplate                             |         |           | Subsidiaries |   |               | Subsidiaries |         |   | Eliminations |       |       | Consolidated |      
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      
|                                                                                                             |                            | (In thousands)                          |        
|ASSETS                                                                                                      
|Current assets:                                                                                              |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |       |       |       |   |         |         
|                                                                                                             | Cash and cash equivalents  |                                         | $       | 199       |              |   | $             | 39,612       |         |   | $            | 1,599 |       |              | $     |      |       |   | $       | 41,410   |        
|                                                                                                             | Accounts receivable        |                                         |         |          |              |   |               | 21,861       |         |   |              | 1,598 |       |              |       |      |       |   |         | 23,459   |        
|                                                                                                             | Other current assets       |                                         |         | 7         |              |   |               | 22,471       |         |   |              | 1,443 |       |              |       |      |       |   |         | 23,921   |        
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      
|                                                                                                             |                            | Total current assets                    |         |           | 206          |   |               |              | 83,944  |   |              |       | 4,640 |              |       |       |      |   |         |          | 88,790  | 
|Property and equipment                                                                                       |                            |                                         |        |           |              |   | 46,269        |              |         |   | 3,456        |       |       |              |      |       |       |   | 49,725  |         
|Contract rights, net                                                                                         |                            |                                         | 147     |           |              |   | 79,758        |              |         |   | 652          |       |       |              |      |       |       |   | 80,557  |         
|Cost in excess of net assets acquired, net                                                                   |                            |                                         | 6,974   |           |              |   | 34,168        |              |         |   |             |       |       |              |      |       |       |   | 41,142  |         
|Intercompany receivable (payable)                                                                            |                            |                                         | 134,674 |           |              |   | (130,765      | )            |         |   | (3,909       | )     |       |              |      |       |       |   |        |         
|Investment in subsidiaries                                                                                   |                            |                                         | (8,747  | )         |              |   |              |              |         |   |             |       |       |              | 8,747 |       |       |   |        |         
|Other assets                                                                                                 |                            |                                         | 8,511   |           |              |   | 48,316        |              |         |   | 984          |       |       |              |      |       |       |   | 57,811  |         
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      
|Total assets                                                                                                 |                            | $                                       | 141,765 |           |              | $ | 161,690       |              |         | $ | 5,823        |       |       | $            | 8,747 |       |       | $ | 318,025 |         
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      
|                                                                                                            
|LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIENCY)                                                           
|Current liabilities                                                                                          |                            | $                                       | 6,565   |           |              | $ | 61,573        |              |         | $ | 2,684        |       |       | $            |      |       |       | $ | 70,822  |         
|Long-term debt                                                                                               |                            |                                         | 105,245 |           |              |   | 105,619       |              |         |   |             |       |       |              |      |       |       |   | 210,864 |         
|Other liabilities                                                                                            |                            |                                         |        |           |              |   | 6,384         |              |         |   |             |       |       |              |      |       |       |   | 6,384   |         
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      
|                                                                                                             |                            | Total liabilities                       |         |           | 111,810      |   |               |              | 173,576 |   |              |       | 2,684 |              |       |       |      |   |         |          | 288,070 | 
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      
|Common stock with conversion option, par value $0.01
    exchangeable for subordinated debt, net of discount |                            |                                         | 14,352  |           |              |   |              |              |         |   |             |       |       |              |      |       |       |   | 14,352  |         
|Stockholders equity (deficiency):                                                                           |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |       |       |       |   |         |         
|                                                                                                             | Common stock               |                                         |         | 400       |              |   |               |             |         |   |              |      |       |              |       |      |       |   |         | 400      |        
|                                                                                                             | Additional paid-in capital |                                         |         | 218,331   |              |   |               |             |         |   |              |      |       |              |       |      |       |   |         | 218,331  |        
|                                                                                                             | Accumulated deficit        |                                         |         | (82,920   | )            |   |               | (11,886      | )       |   |              | 2,407 |       |              |       | 9,479 |       |   |         | (82,920  | )      
|                                                                                                             | Treasury stock and other   |                                         |         | (120,208  | )            |   |               |             |         |   |              | 732   |       |              |       | (732  | )     |   |         | (120,208 | )      
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      
|                                                                                                             |                            | Total stockholders equity (deficiency) |         |           | 15,603       |   |               |              | (11,886 | ) |              |       | 3,139 |              |       |       | 8,747 |   |         |          | 15,603  | 
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      
|Total liabilities and stockholders equity (deficiency)                                                      |                            | $                                       | 141,765 |           |              | $ | 161,690       |              |         | $ | 5,823        |       |       | $            | 8,747 |       |       | $ | 318,025 |         
|                                                                                                             |                            |                                         |         |           |              |   |               |              |         |   |              |       |       |              |      

F-32



---



##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |                                                                                                                    
| | -------------------------------------------------------------------------------------------------------------------
| | Consolidating Condensed Statement of Operations and
    Comprehensive Income (Loss), Year Ended January 3,
    2006

|                                                                                  |  |                |         |           |              |   |               |              |  |   |              |   |  |              |       |  |  |   |         |  
|--------------------------------------------------------------------------------- |  | -------------- | ------- | --------- | ------------ | - | ------------- | ------------ |  | - | ------------ | - |  | ------------ | ----- |  |  | - | ------- | -
|                                                                                  |  |                |         | Combined  |              |   | Combined      |              |  |   |              |  
|                                                                                  |  |                |         | Guarantor |              |   | Non-guarantor |              |  |   |              |  
|                                                                                  |  | Centerplate    |         |           | Subsidiaries |   |               | Subsidiaries |  |   | Eliminations |   |  | Consolidated |      
|                                                                                  |  |                |         |           |              |   |               |              |  |   |              |   |  |              |      
|                                                                                  |  | (In thousands) |        
|Net sales                                                                         |  | $              |        |           |              | $ | 594,146       |              |  | $ | 48,966       |   |  | $            |      |  |  | $ | 643,112 |  
|Cost of sales                                                                     |  |                |        |           |              |   | 478,677       |              |  |   | 40,718       |   |  |              |      |  |  |   | 519,395 |  
|Selling, general, and administrative                                              |  |                | 1,146   |           |              |   | 65,380        |              |  |   | 4,879        |   |  |              |      |  |  |   | 71,405  |  
|Depreciation and amortization                                                     |  |                | 106     |           |              |   | 27,875        |              |  |   | 1,274        |   |  |              |      |  |  |   | 29,255  |  
|Transaction related expenses                                                      |  |                | 1,006   |           |              |   |              |              |  |   |             |   |  |              |      |  |  |   | 1,006   |  
|Contract related losses                                                           |  |                |        |           |              |   | 369           |              |  |   |             |   |  |              |      |  |  |   | 369     |  
|                                                                                  |  |                |         |           |              |   |               |              |  |   |              |   |  |              |      
|Operating income (loss)                                                           |  |                | (2,258  | )         |              |   | 21,845        |              |  |   | 2,095        |   |  |              |      |  |  |   | 21,682  |  
|Interest expense                                                                  |  |                | 15,367  |           |              |   | 15,907        |              |  |   |             |   |  |              |      |  |  |   | 31,274  |  
|Intercompany interest, net                                                        |  |                | (15,876 | )         |              |   | 15,876        |              |  |   |             |   |  |              |      |  |  |   |        |  
|Other income, net                                                                 |  |                | (4      | )         |              |   | (1,134        | )            |  |   | (13          | ) |  |              |      |  |  |   | (1,151  | )
|                                                                                  |  |                |         |           |              |   |               |              |  |   |              |   |  |              |      
|Income (loss) before income taxes                                                 |  |                | (1,745  | )         |              |   | (8,804        | )            |  |   | 2,108        |   |  |              |      |  |  |   | (8,441  | )
|Income tax benefit                                                                |  |                | (349    | )         |              |   | (3,504        | )            |  |   |             |   |  |              |      |  |  |   | (3,853  | )
|Equity in earnings of subsidiaries                                                |  |                | (3,192  | )         |              |   |              |              |  |   |             |   |  |              | 3,192 |  |  |   |        |  
|                                                                                  |  |                |         |           |              |   |               |              |  |   |              |   |  |              |      
|Net income (loss)                                                                 |  |                | (4,588  | )         |              |   | (5,300        | )            |  |   | 2,108        |   |  |              | 3,192 |  |  |   | (4,588  | )
|Accretion of conversion option                                                    |  |                |        |           |              |   |              |              |  |   |             |   |  |              |      |  |  |   |        |  
|                                                                                  |  |                |         |           |              |   |               |              |  |   |              |   |  |              |      
|Net income (loss) available to common stock with or without
    conversion option |  |                | (4,588  | )         |              |   | (5,300        | )            |  |   | 2,108        |   |  |              | 3,192 |  |  |   | (4,588  | )
|                                                                                  |  |                |         |           |              |   |               |              |  |   |              |   |  |              |      
|Net income (loss)                                                                 |  |                | (4,588  | )         |              |   | (5,300        | )            |  |   | 2,108        |   |  |              | 3,192 |  |  |   | (4,588  | )
|Other comprehensive income foreign currency translation
    adjustment            |  |                |        |           |              |   |              |              |  |   | 157          |   |  |              |      |  |  |   | 157     |  
|                                                                                  |  |                |         |           |              |   |               |              |  |   |              |   |  |              |      
|Comprehensive income (loss)                                                       |  | $              | (4,588  | )         |              | $ | (5,300        | )            |  | $ | 2,265        |   |  | $            | 3,192 |  |  | $ | (4,431  | )
|                                                                                  |  |                |         |           |              |   |               |              |  |   |              |   |  |              |      

F-33



---



##### Table of Contents



CENTERPLATE, INC.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |                                                                                
| | -------------------------------------------------------------------------------
| | Consolidating Condensed Statement of Cash Flows, Year
    Ended January 3, 2006

|                                                      |                                                     |                                                     |      |           |              |   |               |              |         |   |              |        |        |   |        |         |         |  
|----------------------------------------------------- | --------------------------------------------------- | --------------------------------------------------- | ---- | --------- | ------------ | - | ------------- | ------------ | ------- | - | ------------ | ------ | ------ | - | ------ | ------- | ------- | -
|                                                      |                                                     |                                                     |      | Combined  |              |   | Combined      |              |         |  
|                                                      |                                                     |                                                     |      | Guarantor |              |   | Non-guarantor |              |         |  
|                                                      |                                                     | Centerplate                                         |      |           | Subsidiaries |   |               | Subsidiaries |         |   | Consolidated |       
|                                                      |                                                     |                                                     |      |           |              |   |               |              |         |   |              |       
|                                                      |                                                     | (In thousands)                                      |     
|Cash flows Provided by (used in) operating activities |                                                     | $                                                   | (381 | )         |              | $ | 25,276        |              |         | $ | 3,513        |        |        | $ | 28,408 |        
|                                                      |                                                     |                                                     |      |           |              |   |               |              |         |   |              |       
|Cash flows from investing activities:                 |                                                     |                                                     |      |           |              |   |               |              |         |   |              |        |        |   |        |        
|                                                      | Purchase of property and equipment                  |                                                     |      |          |              |   |               | (13,823      | )       |   |              | (889   | )      |   |        | (14,712 | )      
|                                                      | Proceeds from sale of property, plant and equipment |                                                     |      |          |              |   |               | 338          |         |   |              |       |        |   |        | 338     |        
|                                                      | Contract rights acquired, net                       |                                                     |      |          |              |   |               | (10,363      | )       |   |              |       |        |   |        | (10,363 | )      
|                                                      |                                                     |                                                     |      |           |              |   |               |              |         |   |              |       
|                                                      |                                                     | Net cash used in investing activities               |      |           |             |   |               |              | (23,848 | ) |              |        | (889   | ) |        |         | (24,737 | )
|                                                      |                                                     |                                                     |      |           |              |   |               |              |         |   |              |       
|Cash flows from financing activities:                 |                                                     |                                                     |      |           |              |   |               |              |         |   |              |        |        |   |        |        
|                                                      | Principal payments on long-term debt                |                                                     |      |          |              |   |               | (806         | )       |   |              |       |        |   |        | (806    | )      
|                                                      | Proceeds from long-term borrowings                  |                                                     |      |          |              |   |               | 107,500      |         |   |              |       |        |   |        | 107,500 |        
|                                                      | Retirement of existing long-term borrowings         |                                                     |      |          |              |   |               | (65,000      | )       |   |              |       |        |   |        | (65,000 | )      
|                                                      | Payments of financing costs                         |                                                     |      |          |              |   |               | (7,266       | )       |   |              |       |        |   |        | (7,266  | )      
|                                                      | Decrease in bank overdrafts                         |                                                     |      |          |              |   |               | (3,626       | )       |   |              |       |        |   |        | (3,626  | )      
|                                                      | Change in intercompany, net                         |                                                     |      | 18,225    |              |   |               | (16,760      | )       |   |              | (1,465 | )      |   |        |        |        
|                                                      | Dividend payments                                   |                                                     |      | (17,840   | )            |   |               |             |         |   |              |       |        |   |        | (17,840 | )      
|                                                      |                                                     |                                                     |      |           |              |   |               |              |         |   |              |       
|                                                      |                                                     | Net cash provided by (used in) financing activities |      |           | 385          |   |               |              | 14,042  |   |              |        | (1,465 | ) |        |         | 12,962  |  
|                                                      |                                                     |                                                     |      |           |              |   |               |              |         |   |              |       
|Increase in cash                                      |                                                     |                                                     | 4    |           |              |   | 15,470        |              |         |   | 1,159        |        |        |   | 16,633 |        
|Cash and cash equivalents:                            |                                                     |                                                     |      |           |              |   |               |              |         |   |              |        |        |   |        |        
|                                                      | Beginning of period                                 |                                                     |      | 195       |              |   |               | 24,142       |         |   |              | 440    |        |   |        | 24,777  |        
|                                                      |                                                     |                                                     |      |           |              |   |               |              |         |   |              |       
|                                                      | End of period                                       |                                                     | $    | 199       |              |   | $             | 39,612       |         |   | $            | 1,599  |        |   | $      | 41,410  |        
|                                                      |                                                     |                                                     |      |           |              |   |               |              |         |   |              |       

F-34



---



##### Table of Contents








|        |                                                                                         
|------- | ----------------------------------------------------------------------------------------
|Item 9. | Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure








|         |                        
|-------- | -----------------------
|Item 9A. | Controls and Procedures

Evaluation of disclosure controls and procedures.


Changes in internal control over financial reporting. 10-K


Managements Report on Internal Control Over Financial
Reporting. 13a-15(f)




| |   |                                                                                                                                                                                                                                                                                                                                                                
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | pertain to the maintenance of records that in reasonable detail
    accurately and fairly reflect the transactions and dispositions
    of the assets of Centerplate;                                                                                                                                                                                          
|
| |  | provide reasonable assurance that transactions are recorded as
    necessary to permit preparation of financial statements in
    accordance with generally accepted accounting principles, and
    that receipts and expenditures of Centerplate are being made
    only in accordance with authorizations of management and
    directors of Centerplate; and
|
| |  | provide reasonable assurance regarding prevention or timely
    detection of unauthorized acquisition, use or disposition of
    Centerplates assets that could have a material effect on
    the financial statements.                                                                                                                                       



Internal
Control  Integrated Framework.




50



---



##### Table of Contents



Report of Independent Registered Public Accounting Firm.




Internal Control 
Integrated Framework








Internal
Control  Integrated Framework Internal Control  Integrated
Framework










51



---



##### Table of Contents






Item 9B.     Other
Information.







PART III







PART IV







|         |                                           
|-------- | ------------------------------------------
|Item 15. | Exhibits and Financial Statement Schedules





| |                                                                                                                         
| | ------------------------------------------------------------------------------------------------------------------------
| | 1. Financial Statements: See Index to Consolidated
    Financial Statements under Item 8 on Page F-1 of this
    report.
|
| | 2. Financial Statement Schedules: None.                                                                                 
|
| | 3. Exhibits                                                                                                             



|        |    |                        |  |                                                                                                                                                                                                                                                                                                                                                                                                             
|------- | -- | ---------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |                       
|Number  |    | Description of Exhibit
|        |    |                       
|        | 3  | .1(1)                  |  | Restated Certificate of Incorporation of Centerplate, Inc.                                                                                                                                                                                                                                                                                                                                                  
|       
|        | 3  | .2(2)                  |  | Amendments to Restated Certificate of Incorporation adopted on
    October 13, 2004.                                                                                                                                                                                                                                                                                                                        
|       
|        | 3  | .3(3)                  |  | Amended and Restated By-Laws of Centerplate, Inc.                                                                                                                                                                                                                                                                                                                                                           
|       
|        | 3  | .4(2)                  |  | Amendments to Amended and Restated By-Laws adopted on
    October 13, 2004.                                                                                                                                                                                                                                                                                                                                 
|       
|        | 4  | .1(4)                  |  | Indenture, dated as of December 10, 2003, among Volume
    Services America Holdings, Inc., the guarantors thereto and The
    Bank of New York, as Trustee.                                                                                                                                                                                                                                                
|       
|        | 4  | .2(4)                  |  | Form of Subordinated Note (included in Exhibit 4.3).                                                                                                                                                                                                                                                                                                                                                        
|       
|        | 4  | .3(4)                  |  | Registration Rights Agreement dated as of December 10,
    2003, among Volume Services America Holdings, Inc., BCP Volume
    L.P., BCP Offshore Volume L.P., Management Direct L.P., Lawrence
    E. Honig, Kenneth R. Frick and Recreational Services, L.L.C.                                                                                                                                             
|       
|        | 4  | .4(4)                  |  | Amended and Restated Stockholders Agreement, dated as of
    December 10, 2003, among Volume Services America Holdings,
    Inc., BCP Volume L.P., BCP Offshore Volume L.P., VSI Management
    Direct L.P. and Recreational Services, L.L.C.                                                                                                                                                               
|       
|        | 4  | .5(5)                  |  | Form of stock certificate for common stock.                                                                                                                                                                                                                                                                                                                                                                 
|       
|        | 4  | .6(4)                  |  | Global IDS Certificate.                                                                                                                                                                                                                                                                                                                                                                                     
|       
|        | 4  | .7(3)                  |  | Board Observer Agreement, dated December 10, 2003, between
    Volume Services America Holdings, Inc. and Blackstone Capital
    Partners II Merchant Banking Fund.                                                                                                                                                                                                                                         
|       
|        | 10 | .1(6)                  |  | Credit Agreement, dated as of April 1, 2005, among Volume
    Services America, Inc., Volume Services, Inc., and Service
    America Corporation as Borrowers, Centerplate, Inc. as
    Guarantor, certain financial institutions as the Lenders, GECC
    Capital Markets Group, Inc. as Lead Arranger and Book Runnov and
    General Electric Capital Corporation as Administrative Agent and
    Lender.
|       
|        | 10 | .2(7)                  |  | Form of Centerplate Deferred Compensation Plan.*                                                                                                                                                                                                                                                                                                                                                            
|       
|        | 10 | .3(8)                  |  | Employment Agreement dated as of November 17, 1995, by and
    between Volume Services, Inc. (a Delaware corporation) and
    Kenneth R. Frick.*                                                                                                                                                                                                                                                            
|       
|        | 10 | .4(8)                  |  | Employment Agreement dated as of September 29, 1998, by and
    between VSI Acquisition II Corporation and Janet L.
    Steinmayer (the September 29, 1989 Employment
    Agreement).*                                                                                                                                                                                                                    

52



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##### Table of Contents



|        |    |                        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                       
|------- | -- | ---------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |                       
|Number  |    | Description of Exhibit
|        |    |                       
|       
|        | 10 | .5(9)                  |  | Amendment, dated September 7, 2005, to the
    September 29, 1998 Employment Agreement.*                                                                                                                                                                                                                                                                                                                                              
|       
|        | 10 | .6(9)                  |  | Letter Agreement, dated September 7, 2005, between
    Centerplate, Inc. and Paul W. MacPhail.*                                                                                                                                                                                                                                                                                                                                       
|       
|        | 10 | .7(10)                 |  | Centerplate, Inc. Long-Term Performance Plan.*                                                                                                                                                                                                                                                                                                                                                                                        
|       
|        | 10 | .8(11)                 |  | Form of Award Letter under Long-Term Performance Plan for senior
    executive officers.*                                                                                                                                                                                                                                                                                                                                             
|       
|        | 10 | .9(11)                 |  | Form of Award Letter under Long-Term Performance Plan for
    participants other than senior executive officers.*                                                                                                                                                                                                                                                                                                                     
|       
|        | 10 | .10(12)                |  | First Amendment to Credit Agreement, dated as of April 15,
    2005, by and among Volume Services America, Inc., Volume
    Services, Inc. and Service America Corporation, as the
    Borrowers, Centerplate, Inc., the Lenders party to the Credit
    Agreement, Wachovia Bank, National Association, as a Lender and
    Syndication Agent, and General Electric Capital Corporation, as
    a Lender and as Administrative Agent.
|       
|        | 10 | .11                    |  | Form of Consent and Amendment, dated as of September 30,
    2005, by and among Volume Services America, Inc., Volume
    Services, Inc., Service America Corporation, Centerplate, Inc.,
    the Lenders signatory thereto, and General Electric Capital
    Corporation, as a Lender and as the Administrative Agent.                                                                                                               
|       
|        | 12 | .1                     |  | Computation of Ratio of Earnings to Fixed Charges                                                                                                                                                                                                                                                                                                                                                                                     
|       
|        | 21 | .1                     |  | Subsidiaries of Centerplate, Inc.                                                                                                                                                                                                                                                                                                                                                                                                     
|       
|        | 31 | .1                     |  | Certification of Principal Executive Officer of Centerplate,
    Inc. pursuant to Rule 13a-14 of the Securities Exchange Act
    of 1934, as adopted pursuant to Section 302 of the
    Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                   
|       
|        | 31 | .2                     |  | Certification of Principal Financial Officer of Centerplate,
    Inc. pursuant to Rule 13a-14 of the Securities Exchange Act
    of 1934, as adopted pursuant to Section 302 of the
    Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                   
|       
|        | 32 | .1                     |  | Certification of Principal Executive Officer of Centerplate,
    Inc. pursuant to 18 U.S.C. Section 1350, as adopted
    pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                                                   
|       
|        | 32 | .2                     |  | Certification of Principal Financial Officer of Centerplate,
    Inc. pursuant to 18 U.S.C. Section 1350, as adopted
    pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                                                   






| |     |                                                                                                      
| | --- | -----------------------------------------------------------------------------------------------------
| | (1) | Incorporated by reference to the
    Form S-1/ A filed
    on December 4, 2003.                      
|
| | (2) | Incorporated by reference to the
    Form 10-Q for the
    quarterly period ended September 28, 2004.
|
| | (3) | Incorporated by reference to the
    Form 10-K filed
    for the fiscal year ended December 30, 2003.
|
| | (4) | Incorporated by reference to the
    Form 8-K filed on
    December 22, 2003.                        
|
| | (5) | Incorporated by reference to the
    Form S-1/ A filed
    on November 7, 2003.                      
|
| | (6) | Incorporated by reference to the
    Form 8-K filed on
    April 6, 2005.                            
|
| | (7) | Incorporated by reference to the
    Form 10-K for the
    fiscal year ended December 28, 2004.      
|
| | (8) | Incorporated by reference to the
    Form S-1/ A filed
    on May 14, 2003.                          
|
| | (9) | Incorporated by reference to the
    Form 8-K filed on
    September 7, 2005.                        



|     |                                                                                                  
|---- | -------------------------------------------------------------------------------------------------
|(10) | Incorporated by reference to the
    Form 8-K filed on
    October 18, 2004.                     
|    
|(11) | Incorporated by reference to the
    Form 8-K filed on
    November 23, 2004.                    
|    
|(12) | Incorporated by reference to the
    Form 10-Q for the
    quarterly period ended March 29, 2005.



| |   |                                                                                                                        
| | - | -----------------------------------------------------------------------------------------------------------------------
| | * | Management contract or compensatory plan or arrangement required
    to be filed and herein incorporated as an exhibit.

53



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##### Table of Contents



SIGNATURES






| |                  
| | -----------------
| | CENTERPLATE, INC.



| |     |                        
| | --- | -----------------------
| | By: | /s/ Janet L. Steinmayer

| |                                             
| | --------------------------------------------
| | Name: Janet L. Steinmayer                   
| | Title: President and Chief Executive Officer



|                                           |  |                                                                                                                      |  |                |  | 
|------------------------------------------ |  | -------------------------------------------------------------------------------------------------------------------- |  | -------------- |  | 
|Name                                       |  | Title                                                                                                                |  | Date          
|                                           |  |                                                                                                                      |  |               
|                                          
|/s/ Janet L. SteinmayerJanet L. Steinmayer |  | President, Chief Executive Officer and Director (Principal
    Executive Officer)                                    |  | March 17, 2006
|                                          
|/s/ Kenneth R. FrickKenneth R. Frick       |  | Executive Vice President,
    Chief Financial Officer and
    Treasurer (Principal Financial and Accounting Officer) |  | March 17, 2006
|                                          
|/s/ David M. WilliamsDavid M. Williams     |  | Director and Chairman of the Board                                                                                   |  | March 17, 2006
|                                          
|/s/ Felix P. CheeFelix P. Chee             |  | Director                                                                                                             |  | March 17, 2006
|                                          
|/s/ Sue Ling GinSue Ling Gin               |  | Director                                                                                                             |  | March 17, 2006
|                                          
|/s/ Alfred PoeAlfred Poe                   |  | Director                                                                                                             |  | March 17, 2006
|                                          
|/s/ Peter WallacePeter Wallace             |  | Director                                                                                                             |  | March 17, 2006
|                                          
|/s/ Glenn ZanderGlenn Zander               |  | Director                                                                                                             |  | March 17, 2006