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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q



|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------

For the quarterly period ended September 30, 2006



| ̈ | 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:
1-14927

OPINION RESEARCH CORPORATION

(Exact name of registrant as specified in its charter)



|                         |  |                                     
|------------------------ |  | ------------------------------------
|Delaware                 |  | 22-3118960                          
|(State of incorporation) |  | (I.R.S. Employer Identification No.)



|                                                 |  |           
|------------------------------------------------ |  | ----------
|600 College Road East, Suite #4100 Princeton, NJ |  | 08540     
|(Address of principal executive offices)         |  | (Zip Code)

609-452-5400

(Registrants telephone number, including area code)

Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter periods that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days:

Yes  x    No ̈

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

Large accelerated filer ̈Accelerated filer ̈Non-accelerated filer x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ̈No  x

Indicate the
number of shares outstanding of each of the issuers classes of common stock, as of the latest practicable date.

Common Stock, $0.01 Par Value 
5,503,047 shares as of November 3, 2006.



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##### Table of Contents

OPINION RESEARCH CORPORATION AND SUBSIDIARIES

INDEX



|                              |  |                                                                                                             |  |   
|----------------------------- |  | ----------------------------------------------------------------------------------------------------------- |  | --
|Part I. Financial Information |  |                                                                                                            
|                              |  |                                                                                                            
|Item 1.                       |  | Financial Statements                                                                                        |  |   
|                              |  |                                                                                                            
|                              |  | Consolidated Balance Sheets  December 31, 2005 and September 30, 2006 (Unaudited)                          |  | 1 
|                              |  |                                                                                                            
|                              |  | Consolidated Statements of Operations (Unaudited) - Three and nine months ended September 30, 2005 and 2006 |  | 2 
|                              |  |                                                                                                            
|                              |  | Consolidated Statements of Cash Flows (Unaudited) - Nine months ended September 30, 2005 and 2006           |  | 3 
|                              |  |                                                                                                            
|                              |  | Notes to consolidated financial statements  September 30, 2006 (Unaudited)                                 |  | 4 
|                              |  |                                                                                                            
|Item 2.                       |  | Managements Discussion and Analysis of Financial Condition and Results of Operations                       |  | 13
|                              |  |                                                                                                            
|Item 3.                       |  | Quantitative and Qualitative Disclosures About Market Risk                                                  |  | 21
|                              |  |                                                                                                            
|Item 4.                       |  | Controls and Procedures                                                                                     |  | 21
|                              | 
|Part II. Other Information    |  |                                                                                                            
|                              |  |                                                                                                            
|Item 1.                       |  | Legal Proceedings                                                                                           |  | 22
|                              |  |                                                                                                            
|Item 1A.                      |  | Risk Factors                                                                                                |  | 22
|                              |  |                                                                                                            
|Item 2.                       |  | Unregistered Sales of Equity Securities and Use of Proceeds                                                 |  | 22
|                              |  |                                                                                                            
|Item 3.                       |  | Defaults upon Senior Securities                                                                             |  | 22
|                              |  |                                                                                                            
|Item 4.                       |  | Submission of Matters to a Vote of Security Holders                                                         |  | 23
|                              |  |                                                                                                            
|Item 5.                       |  | Other Information                                                                                           |  | 23
|                              |  |                                                                                                            
|Item 6.                       |  | Exhibits                                                                                                    |  | 23
|                              | 
|Signature                     |  | 24                                                                                                         



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##### Table of Contents

PART I. FINANCIAL INFORMATION



|ITEM 1. | FINANCIAL STATEMENTS
|------- | --------------------

OPINION RESEARCH CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

(in thousands, except share amounts)



|                                                                                                                                                                                     |  |                  |         |   |                  |   |         |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ---------------- | ------- | - | ---------------- | - | ------- | -
|                                                                                                                                                                                     |  | December 31,2005 |         |   | September 302006 |  
|                                                                                                                                                                                     |  |                  |         |   | (Unaudited)      |  
|Assets                                                                                                                                                                               |  |                  |         |   |                  |   |         |  
|Current Assets:                                                                                                                                                                      |  |                  |         |   |                  |   |         |  
|Cash and cash equivalents                                                                                                                                                            |  | $                |        |   |                  | $ | 838     |  
|Accounts receivable:                                                                                                                                                                 |  |                  |         |   |                  |   |         |  
|Billed                                                                                                                                                                               |  |                  | 26,959  |   |                  |   | 22,872  |  
|Unbilled services                                                                                                                                                                    |  |                  | 17,600  |   |                  |   | 22,224  |  
|                                                                                                                                                                                     |  |                  |         |   |                  |   |         |  
|                                                                                                                                                                                     |  |                  | 44,559  |   |                  |   | 45,096  |  
|Less: allowance for doubtful accounts                                                                                                                                                |  |                  | 58      |   |                  |   | 13      |  
|                                                                                                                                                                                     |  |                  |         |   |                  |   |         |  
|                                                                                                                                                                                     |  |                  | 44,501  |   |                  |   | 45,083  |  
|Prepaid expenses and other current assets                                                                                                                                            |  |                  | 2,291   |   |                  |   | 4,550   |  
|Assets of discontinued operations                                                                                                                                                    |  |                  | 505     |   |                  |   |        |  
|                                                                                                                                                                                     |  |                  |         |   |                  |   |         |  
|Total current assets                                                                                                                                                                 |  |                  | 47,297  |   |                  |   | 50,471  |  
|Property and equipment, net                                                                                                                                                          |  |                  | 8,833   |   |                  |   | 8,085   |  
|Intangibles, net                                                                                                                                                                     |  |                  | 224     |   |                  |   | 230     |  
|Goodwill                                                                                                                                                                             |  |                  | 26,903  |   |                  |   | 27,161  |  
|Deferred income taxes                                                                                                                                                                |  |                  | 4,893   |   |                  |   | 2,797   |  
|Other assets                                                                                                                                                                         |  |                  | 3,806   |   |                  |   | 3,880   |  
|Assets of discontinued operations                                                                                                                                                    |  |                  | 212     |   |                  |   |        |  
|                                                                                                                                                                                     |  |                  |         |   |                  |   |         |  
|                                                                                                                                                                                     |  | $                | 92,168  |   |                  | $ | 92,624  |  
|                                                                                                                                                                                     |  |                  |         |   |                  |   |         |  
|Liabilities and Stockholders Equity                                                                                                                                                 |  |                  |         |   |                  |   |         |  
|Current Liabilities:                                                                                                                                                                 |  |                  |         |   |                  |   |         |  
|Accounts payable                                                                                                                                                                     |  | $                | 6,269   |   |                  | $ | 7,540   |  
|Accrued expenses                                                                                                                                                                     |  |                  | 11,705  |   |                  |   | 12,189  |  
|Deferred revenues                                                                                                                                                                    |  |                  | 4,156   |   |                  |   | 4,628   |  
|Short-term borrowings                                                                                                                                                                |  |                  | 3,000   |   |                  |   | 3,000   |  
|Other current liabilities                                                                                                                                                            |  |                  | 3,199   |   |                  |   | 2,617   |  
|Liabilities of discontinued operations                                                                                                                                               |  |                  | 586     |   |                  |   |        |  
|                                                                                                                                                                                     |  |                  |         |   |                  |   |         |  
|Total current liabilities                                                                                                                                                            |  |                  | 28,915  |   |                  |   | 29,974  |  
|Long-term debt                                                                                                                                                                       |  |                  | 55,321  |   |                  |   | 50,306  |  
|Other liabilities                                                                                                                                                                    |  |                  | 1,517   |   |                  |   | 3,262   |  
|Liabilities of discontinued operations                                                                                                                                               |  |                  | 154     |   |                  |   |        |  
|Stockholders Equity:                                                                                                                                                                |  |                  |         |   |                  |   |         |  
|Preferred stock, $.01 par value, 1,000,000 shares authorized: Series A - 10,000 shares designated, none issued or outstanding                                                        |  |                  |        |   |                  |   |        |  
|Common stock, $.01 par value, 20,000,000 shares authorized, 5,409,148 shares issued and 5,360,326 outstanding in 2005, and 5,549,028 shares
issued and 5,500,206 outstanding in 2006 |  |                  | 54      |   |                  |   | 55      |  
|Additional paid-in capital                                                                                                                                                           |  |                  | 20,631  |   |                  |   | 21,750  |  
|Retained deficit                                                                                                                                                                     |  |                  | (14,002 | ) |                  |   | (13,478 | )
|Treasury stock, at cost, 48,822 shares                                                                                                                                               |  |                  | (261    | ) |                  |   | (261    | )
|Accumulated other comprehensive (loss) income                                                                                                                                        |  |                  | (161    | ) |                  |   | 1,016   |  
|                                                                                                                                                                                     |  |                  |         |   |                  |   |         |  
|Total stockholders equity                                                                                                                                                           |  |                  | 6,261   |   |                  |   | 9,082   |  
|                                                                                                                                                                                     |  |                  |         |   |                  |   |         |  
|                                                                                                                                                                                     |  | $                | 92,168  |   |                  | $ | 92,624  |  
|                                                                                                                                                                                     |  |                  |         |   |                  |   |         |  

See notes to consolidated financial statements.



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##### Table of Contents

OPINION RESEARCH CORPORATION AND SUBSIDIARIES

Consolidated Statements of Income

(in thousands, except share and per share amounts)

(unaudited)



|                                                   |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|-------------------------------------------------- |  | ------------------------------- | --------- | - | ------------------------------ | - | --------- | ---- |  | - | --------- | - |  | - | --------- | -
|                                                   |  | Three Months EndedSeptember 30, |           |   | Nine Months EndedSeptember 30, |  
|                                                   |  | 2005                            |           |   | 2006                           |   |           | 2005 |  |   | 2006      |  
|Revenues                                           |  | $                               | 46,585    |   |                                | $ | 47,624    |      |  | $ | 141,782   |   |  | $ | 144,960   |  
|Cost of revenues (exclusive of depreciation)       |  |                                 | 34,275    |   |                                |   | 34,398    |      |  |   | 102,780   |   |  |   | 104,809   |  
|                                                   |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|Gross profit                                       |  |                                 | 12,310    |   |                                |   | 13,226    |      |  |   | 39,002    |   |  |   | 40,151    |  
|Selling, general and administrative expenses       |  |                                 | 8,716     |   |                                |   | 9,402     |      |  |   | 27,301    |   |  |   | 28,140    |  
|Depreciation and amortization                      |  |                                 | 864       |   |                                |   | 966       |      |  |   | 2,471     |   |  |   | 2,859     |  
|                                                   |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|Operating income                                   |  |                                 | 2,730     |   |                                |   | 2,858     |      |  |   | 9,230     |   |  |   | 9,152     |  
|Interest expense, net                              |  |                                 | 1,405     |   |                                |   | 1,553     |      |  |   | 4,539     |   |  |   | 4,803     |  
|Other non-operating expenses                       |  |                                 | 1,379     |   |                                |   | 1,199     |      |  |   | 1,422     |   |  |   | 1,243     |  
|                                                   |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|(Loss) income before provision for income taxes    |  |                                 | (54       | ) |                                |   | 106       |      |  |   | 3,269     |   |  |   | 3,106     |  
|Provision for income taxes                         |  |                                 | 551       |   |                                |   | 609       |      |  |   | 1,896     |   |  |   | 2,079     |  
|                                                   |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|(Loss) income from continuing operations           |  |                                 | (605      | ) |                                |   | (503      | )    |  |   | 1,373     |   |  |   | 1,027     |  
|                                                   |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|Discontinued operations                            |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|Loss from discontinued operations, net of tax      |  |                                 | (4,049    | ) |                                |   | (1        | )    |  |   | (4,544    | ) |  |   | (139      | )
|Loss on disposal, net of tax                       |  |                                 |          |   |                                |   | (364      | )    |  |   |          |   |  |   | (364      | )
|                                                   |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|Loss from discontinued operations                  |  |                                 | (4,049    | ) |                                |   | (365      | )    |  |   | (4,544    | ) |  |   | (503      | )
|                                                   |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|Net (loss) income                                  |  | $                               | (4,654    | ) |                                | $ | (868      | )    |  | $ | (3,171    | ) |  | $ | 524       |  
|                                                   |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|Repurchased LLR interests                          |  |                                 | (9,904    | ) |                                |   |          |      |  |   | (9,904    | ) |  |   |          |  
|                                                   |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|Net (loss) income available to common shareholders |  | $                               | (14,558   | ) |                                | $ | (868      | )    |  | $ | (13,075   | ) |  | $ | 524       |  
|                                                   |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|Basic earnings per share                           |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|(Loss) income from continuing operations           |  | $                               | (1.86     | ) |                                | $ | (0.09     | )    |  | $ | (1.38     | ) |  | $ | 0.19      |  
|Loss from discontinued operations                  |  |                                 | (0.72     | ) |                                |   | (0.07     | )    |  |   | (0.74     | ) |  |   | (0.09     | )
|                                                   |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|Net (loss) income available to common shareholders |  | $                               | (2.58     | ) |                                | $ | (0.16     | )    |  | $ | (2.12     | ) |  | $ | 0.10      |  
|                                                   |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|Diluted earnings per share                         |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|(Loss) income from continuing operations           |  | $                               | (1.86     | ) |                                | $ | (0.09     | )    |  | $ | (1.38     | ) |  | $ | 0.18      |  
|Loss from discontinued operations                  |  |                                 | (0.72     | ) |                                |   | (0.07     | )    |  |   | (0.74     | ) |  |   | (0.09     | )
|                                                   |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|Net (loss) income available to common shareholders |  | $                               | (2.58     | ) |                                | $ | (0.16     | )    |  | $ | (2.12     | ) |  | $ | 0.09      |  
|                                                   |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|Weighted average shares outstanding:               |  |                                 |           |   |                                |   |           |      |  |   |           |   |  |   |           |  
|Basic                                              |  |                                 | 5,642,665 |   |                                |   | 5,500,206 |      |  |   | 6,158,475 |   |  |   | 5,445,746 |  
|Diluted                                            |  |                                 | 5,642,665 |   |                                |   | 5,500,206 |      |  |   | 6,158,475 |   |  |   | 5,638,407 |  

See notes to consolidated financial statements.



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##### Table of Contents

OPINION RESEARCH CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(in thousands)

(Unaudited)



|                                                                                               |  |                                |         |   |      |   |        |  
|---------------------------------------------------------------------------------------------- |  | ------------------------------ | ------- | - | ---- | - | ------ | -
|                                                                                               |  | Nine months endedSeptember 30, |        
|                                                                                               |  | 2005                           |         |   | 2006 |  
|Cash flows from operating activities:                                                          |  |                                |         |   |      |   |        |  
|Net (loss) income                                                                              |  | $                              | (3,171  | ) |      | $ | 524    |  
|Less:                                                                                          |  |                                |         |   |      |   |        |  
|Loss from discontinued operations                                                              |  |                                | (4,544  | ) |      |   | (503   | )
|                                                                                               |  |                                |         |   |      |   |        |  
|Income from continuing operations                                                              |  |                                | 1,373   |   |      |   | 1,027  |  
|Adjustments to income from continuing operations to net cash provided by operating activities: |  |                                |         |   |      |   |        |  
|Depreciation and amortization                                                                  |  |                                | 2,471   |   |      |   | 2,859  |  
|Loss on disposal of fixed assets                                                               |  |                                | 1       |   |      |   |       |  
|Non-cash interest expense                                                                      |  |                                | 1,141   |   |      |   | 401    |  
|Provision for doubtful accounts                                                                |  |                                |        |   |      |   | 61     |  
|Deferred income tax                                                                            |  |                                | (16     | ) |      |   | 543    |  
|Equity based compensation                                                                      |  |                                |        |   |      |   | 432    |  
|Change in fair value of derivative                                                             |  |                                |        |   |      |   | 1      |  
|Changes in operating assets and liabilities:                                                   |  |                                |         |   |      |   |        |  
|Billed accounts receivable                                                                     |  |                                | 30      |   |      |   | 4,322  |  
|Unbilled services                                                                              |  |                                | (186    | ) |      |   | (4,426 | )
|Other assets                                                                                   |  |                                | (274    | ) |      |   | (860   | )
|Accounts payable                                                                               |  |                                | (658    | ) |      |   | 1,242  |  
|Accrued expenses and other liabilities                                                         |  |                                | 4,687   |   |      |   | 1,456  |  
|Deferred revenues                                                                              |  |                                | (238    | ) |      |   | 383    |  
|                                                                                               |  |                                |         |   |      |   |        |  
|Net cash provided by operating activities of continuing operations                             |  |                                | 8,331   |   |      |   | 7,441  |  
|                                                                                               |  |                                |         |   |      |   |        |  
|Cash flows from investing activities:                                                          |  |                                |         |   |      |   |        |  
|Capital expenditures                                                                           |  |                                | (2,768  | ) |      |   | (1,951 | )
|                                                                                               |  |                                |         |   |      |   |        |  
|Net cash used in investing activities of continuing operations                                 |  |                                | (2,768  | ) |      |   | (1,951 | )
|                                                                                               |  |                                |         |   |      |   |        |  
|Cash flows from financing activities:                                                          |  |                                |         |   |      |   |        |  
|Net borrowings (repayments) under line-of-credit agreement                                     |  |                                | 4,156   |   |      |   | (2,765 | )
|Proceeds from the issuance of notes payable                                                    |  |                                | 35,000  |   |      |   |       |  
|Repayments of notes payable                                                                    |  |                                | (22,077 | ) |      |   | (2,250 | )
|Payment for repurchased LLR interests                                                          |  |                                | (20,414 | ) |      |   |       |  
|Payments of loan origination and amendment fees                                                |  |                                | (495    | ) |      |   | (231   | )
|Repayments under capital lease arrangements                                                    |  |                                | (145    | ) |      |   | (101   | )
|Proceeds from the issuance of capital stock and exercise of options and warrants               |  |                                | 477     |   |      |   | 686    |  
|                                                                                               |  |                                |         |   |      |   |        |  
|Net cash used in financing activities of continuing operations                                 |  |                                | (3,498  | ) |      |   | (4,661 | )
|                                                                                               |  |                                |         |   |      |   |        |  
|Net cash used in operating activities of discontinued operations                               |  |                                | (608    | ) |      |   | (72    | )
|Net cash used in investing activities of discontinued operations                               |  |                                | (195    | ) |      |   |       |  
|Effect of exchange rate changes on cash and cash equivalents                                   |  |                                | 40      |   |      |   | 81     |  
|                                                                                               |  |                                |         |   |      |   |        |  
|Increase in cash and cash equivalents                                                          |  |                                | 1,302   |   |      |   | 838    |  
|Cash and cash equivalents at beginning of year                                                 |  |                                | 419     |   |      |   |       |  
|                                                                                               |  |                                |         |   |      |   |        |  
|Cash and cash equivalents at end of period                                                     |  | $                              | 1,721   |   |      | $ | 838    |  
|                                                                                               |  |                                |         |   |      |   |        |  
|Supplemental disclosures:                                                                      |  |                                |         |   |      |   |        |  
|Cash paid for:                                                                                 |  |                                |         |   |      |   |        |  
|Interest                                                                                       |  | $                              | 2,773   |   |      | $ | 4,460  |  
|Income tax                                                                                     |  |                                | 1,382   |   |      |   | 920    |  
|Non-cash investing and financing activities:                                                   |  |                                |         |   |      |   |        |  
|Acquisition of equipment under capital leases                                                  |  | $                              | 20      |   |      | $ | 24     |  

See notes to consolidated financial statements.



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##### Table of Contents

OPINION RESEARCH CORPORATION AND SUBSIDIARIES

Notes to Consolidated Financial Statements

September 30, 2006

(Unaudited)

NOTE A  BASIS OF PRESENTATION

The
accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (herein referred to as GAAP) for interim financial information and
with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting
of normal recurring deferrals and accruals) considered necessary for a fair presentation have been included.

The consolidated financial statements include
the accounts of our company and our wholly owned subsidiaries. All inter-company transactions are eliminated upon consolidation. Operating results for the three and nine months ended September 30, 2006 are not necessarily indicative of the
results that may be expected for the full year. For further information, reference should be made to the consolidated financial statements and footnotes contained in our Annual Report on Form 10-K for the year ended December 31, 2005. For
purposes of this report, Opinion Research, the Company, we, our, us or similar references mean Opinion Research Corporation and its consolidated subsidiaries unless the context requires
otherwise.

NOTE B infoUSA ACQUISITION

On August 4, 2006, we entered into a definitive merger agreement pursuant to which the Company has agreed to be acquired by infoUSA Inc. in a transaction valued at approximately $134.3 million, including
the assumption or repayment of debt. Under the terms of the agreement, our stockholders will receive $12.00 per share in cash for each share of common stock they hold. Our Board of Directors has unanimously approved the agreement and will recommend
that our stockholders approve the merger. The transaction is expected to be completed in the fourth quarter of 2006 and is subject to receipt of stockholder approval and regulatory approval, as well as satisfaction of other customary closing
conditions. A special meeting of stockholders will be held on December 4, 2006 for the purpose of approving the proposed merger with infoUSA.

NOTE C  RECENT ACCOUNTING PRONOUNCEMENTS

In June 2006, the Financial Accounting Standard Board (FASB) issued
Interpretation No. 48, Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statement No. 109, Accounting for Income Taxes. This Interpretation prescribes a recognition threshold and measurement attribute for
the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. This Interpretation also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods,
disclosure, and transition. This Interpretation is effective for fiscal years beginning after December 15, 2006. We are currently evaluating the impact Interpretation No. 48 will have on our financial position, results of operations,
earnings per share and cash flows when adopted.

In September 2006, the FASB issued Statement No. 157, Fair Value Measurement (Statement
157). This statement clarifies the definition of fair value, establishes a framework for measuring fair



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value and expands the disclosures on fair value measurements. We will adopt Statement 157 on January 1, 2008. The adoption is not expected to have a
material impact on our financial position, results of operations or cash flows.

In September 2006, the SEC issued Staff Accounting Bulletin No. 108
Guidance on Quantifying Financial Statement Misstatements (SAB 108). SAB 108 addresses how the effects of prior-year uncorrected misstatements should be considered when quantifying the misstatements in current-year financial
statements. The SAB requires registrants to quantify misstatements using both the year-end balance sheet perspective iron curtain method and current year income statement perspective rollover method and to evaluate whether
either approach results in quantifying the aggregate impact of prior period uncorrected misstatements as material in light of relevant quantitative and qualitative factors.

SAB 108 is effective for fiscal years ending after November 15, 2006. Initial application of this guideline allows that material errors that existed at the beginning of 2006 may be corrected with a one-time
cumulative effect adjustment of opening retained earnings. Historically, we have evaluated uncorrected differences utilizing the rollover method, and we are currently evaluating the impact, if any, of adopting the provisions of SAB 108
on our financial position, results of operations and liquidity.

NOTE D  DISCONTINUED OPERATIONS

In December 2005 we entered into an agreement to sell the Companys teleservices business, previously identified as a reportable segment, for the assumption of all
the liabilities of the teleservices business, other than bank debt, and the possibility of receiving payments during the next five years based on its revenues over a specified threshold determined annually in accordance with a formula set forth in
the sale agreement. As of September 30, 2006, we have not booked any receivable for payments under the sale agreement. Additionally, we announced the closure of our market research operations in South Korea and Mexico due to inconsistent
operating results and a determination that these operations were not strategic in providing the Companys services to its global clients. We have completed the closure of both entities and recorded a loss on disposal of $364,000 for the three
and nine months ended September 30, 2006. No further charges are anticipated.

In accordance with Statement of Financial Accounting Standards
(SFAS) No. 144 Accounting for the Impairment or Disposal of Long-Lived Assets, the above segment and operations are classified as discontinued operations and the financial results are reported as discontinued operations
for all periods presented.

The financial results of the former teleservices business and market research operations in South Korea and Mexico included in
discontinued operations are as follows:



|                                                   |  |                                |        |   |                               |   |      |      |  |   |        |   |  |   |      |  
|-------------------------------------------------- |  | ------------------------------ | ------ | - | ----------------------------- | - | ---- | ---- |  | - | ------ | - |  | - | ---- | -
|                                                   |  | Three Months EndedSeptember 30 |        |   | Nine Months EndedSeptember 30 |  
|($ in thousands)                                   |  | 2005                           |        |   | 2006                          |   |      | 2005 |  |   | 2006   |  
|Loss before income tax                             |  | $                              | (6,043 | ) |                               | $ | (1   | )    |  | $ | (6,668 | ) |  | $ | (139 | )
|Income tax benefits                                |  |                                | (1,994 | ) |                               |   |     |      |  |   | (2,124 | ) |  |   |     |  
|                                                   |  |                                |        |   |                               |   |      |      |  |   |        |   |  |   |      |  
|Loss from discontinued operations, net             |  |                                | (4,049 | ) |                               |   | (1   | )    |  |   | (4,544 | ) |  |   | (139 | )
|Loss on disposal, net of tax benefit of $- in 2006 |  |                                |       |   |                               |   | (364 | )    |  |   |       |   |  |   | (364 | )
|                                                   |  |                                |        |   |                               |   |      |      |  |   |        |   |  |   |      |  
|Loss from discontinued operations                  |  | $                              | (4,049 | ) |                               | $ | (365 | )    |  | $ | (4,544 | ) |  | $ | (503 | )
|                                                   |  |                                |        |   |                               |   |      |      |  |   |        |   |  |   |      |  



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The assets and liabilities of the discontinued operations in South Korea and Mexico are also presented separately as
assets and liabilities of discontinued operations in the accompanying consolidated balance sheets.

NOTE E  CREDIT FACILITIES

In May 2004, we entered into a secured revolving credit facility of $35.0 million with Citizens Bank of Pennsylvania and First Horizon Bank (the Senior
Revolving Facility). The Senior Revolving Facility was for a three-year term and is secured by substantially all of our assets. In May 2006, we extended the maturity on the Senior Revolving Facility from May 3, 2007 to April 30,
2009. The Senior Revolving Facility carries an interest rate at our discretion of either the financial institutions designated base rate (8.25% at September 30, 2006,) plus 100 basis points or LIBOR (3-month LIBOR was 5.37% at
September 30, 2006) plus 300 basis points. As of September 30, 2006, the amount outstanding was $22.8 million and there was approximately $11.7 million of additional credit available under the Senior Revolving Facility.

In March 2005, we entered into a new secured term loan of $15.0 million with Citizens Bank of Pennsylvania and First Horizon Bank (the Term Loan). The Term
Loan is for a five-year term and is secured by substantially all of our assets. The Term Loan, carrying an interest rate of LIBOR plus 350 basis points, requires principal payments of $750,000 per quarter and matures in 2010. The proceeds from the
Term Loan and a drawdown from the Senior Revolving Facility were used to prepay the secured and unsecured subordinated notes in the combined amount of $20.5 million negotiated previously with another financial institution. We wrote-off unamortized
fees in the amount of $813,000 and incurred prepayment penalties in the amount of $362,000 in connection with this transaction in the first quarter of 2005.

In July 2005, we issued $20.0 million of unsecured subordinated notes to The Royal Bank of Scotland. These notes mature in July 2011, carry cash interest of 14% per year and have no interim principal amortization. The proceeds from the
issuance of these unsecured subordinated notes were used to finance the repurchase of interests in the Company held by LLR Equity Partners, L.P. and LLR Equity Partners Parallel, L.P. (the LLR Partnerships or LLR). The
transaction consisted of (i) the repurchase of 1,176,458 common shares purchased by LLR on September 1, 2000; (ii) a warrant to purchase 740,500 common shares; (iii) rights to convert the common shares into preferred shares with
an annual dividend obligation of $1.2 million; (iv) anti-dilution rights and warrants; and (v) other rights.

We are required to maintain certain
financial covenants under our credit facilities, such as minimum earnings, debt-to-earnings, interest coverage, and other financial ratios. In addition, covenants under our credit facilities limit or prohibit our ability to incur additional debt,
prepay specified types of indebtedness, pay dividends, make investments, sell assets, or engage in mergers and acquisitions.

NOTE F  DERIVATIVE
FINANCIAL INSTRUMENT AND HEDGING ACTIVITY

We use derivative financial instruments to mitigate market risk from changes in interest rates. We do not use
derivative financial instruments for speculative purposes.

In September 2005, we entered into an interest rate cap agreement with Citizens Bank to hedge
our interest rate risk exposure on the Term Loan due to its variable interest rate. The interest rate cap qualified as a cash flow hedge pursuant to SFAS No. 133, Accounting for Derivatives Instruments and Hedging Activities. The
interest rate cap is set at a LIBOR rate of 4.5%, has a remaining life matching the Term Loan, was based upon a notional amount of $13.5 million, and was purchased for a premium of $106,000. Changes in the fair value of the interest rate cap are
reported as a component



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of Other Comprehensive Income. Cash received from the interest rate cap arrangement is recorded as an offset to interest expense in the period or periods
during which the interest rate on the Term Loan exceeds the interest rate cap.

For the three months ended September 30, 2006, the fair value of the
interest rate cap decreased by approximately $90,000. For the nine months ended September 30, 2006, the value of the interest rate cap increased by approximately $2,100. The change in the fair value of the interest rate cap, net of tax, is
reflected in Other Comprehensive Income. For the three months and nine months ended September 30, 2006, we have recorded cash received and expected receipt of approximately $23,000 and $40,000, respectively, as an offset to interest expense.

NOTE G - EARNINGS (LOSS) PER SHARE

The following table sets forth the computation of basic and diluted earnings per share:



|                                                   |  |                                 |         |   |                                |   |       |      |  |   |         |   |  |   |       |  
|-------------------------------------------------- |  | ------------------------------- | ------- | - | ------------------------------ | - | ----- | ---- |  | - | ------- | - |  | - | ----- | -
|                                                   |  | Three Months EndedSeptember 30, |         |   | Nine Months EndedSeptember 30, |  
|($ in thousands except per share amounts)          |  | 2005                            |         |   | 2006                           |   |       | 2005 |  |   | 2006    |  
|(Loss) income from continuing operations           |  | $                               | (605    | ) |                                | $ | (503  | )    |  | $ | 1,373   |   |  | $ | 1,027 |  
|Repurchased LLR interests                          |  |                                 | (9,904  | ) |                                |   |      |      |  |   | (9,904  | ) |  |   |      |  
|                                                   |  |                                 |         |   |                                |   |       |      |  |   |         |   |  |   |       |  
|(Loss) income from continuing operations available |  |                                 |         |   |                                |   |       |      |  |   |         |   |  |   |       |  
|to shareholders                                    |  | $                               | (10,509 | ) |                                | $ | (503  | )    |  | $ | (8,531  | ) |  | $ | 1,027 |  
|Loss from discontinued operations                  |  |                                 | (4,049  | ) |                                |   | (365  | )    |  |   | (4,544  | ) |  |   | (503  | )
|                                                   |  |                                 |         |   |                                |   |       |      |  |   |         |   |  |   |       |  
|Net (loss) income available to common shareholders |  | $                               | (14,558 | ) |                                | $ | (868  | )    |  | $ | (13,075 | ) |  | $ | 524   |  
|                                                   |  |                                 |         |   |                                |   |       |      |  |   |         |   |  |   |       |  
|Weighted average shares outstanding                |  |                                 |         |   |                                |   |       |      |  |   |         |   |  |   |       |  
|Basic                                              |  |                                 | 5,643   |   |                                |   | 5,500 |      |  |   | 6,158   |   |  |   | 5,446 |  
|Effect of dilutive potential common shares         |  |                                 |        |   |                                |   |      |      |  |   |        |   |  |   | 192   |  
|                                                   |  |                                 |         |   |                                |   |       |      |  |   |         |   |  |   |       |  
|Diluted                                            |  |                                 | 5,643   |   |                                |   | 5,500 |      |  |   | 6,158   |   |  |   | 5,638 |  
|                                                   |  |                                 |         |   |                                |   |       |      |  |   |         |   |  |   |       |  
|Basic earnings per share                           |  |                                 |         |   |                                |   |       |      |  |   |         |   |  |   |       |  
|(Loss) income from continuing operations           |  | $                               | (1.86   | ) |                                | $ | (0.09 | )    |  | $ | (1.38   | ) |  | $ | 0.19  |  
|Loss from discontinued operations                  |  | $                               | (0.72   | ) |                                | $ | (0.07 | )    |  | $ | (0.74   | ) |  | $ | (0.09 | )
|Net (loss) income available to common shareholders |  | $                               | (2.58   | ) |                                | $ | (0.16 | )    |  | $ | (2.12   | ) |  | $ | 0.10  |  
|Diluted earnings per share                         |  |                                 |         |   |                                |   |       |      |  |   |         |   |  |   |       |  
|(Loss) income from continuing operations           |  | $                               | (1.86   | ) |                                | $ | (0.09 | )    |  | $ | (1.38   | ) |  | $ | 0.18  |  
|Loss from discontinued operations                  |  | $                               | (0.72   | ) |                                | $ | (0.07 | )    |  | $ | (0.74   | ) |  | $ | (0.09 | )
|Net (loss) income available to common shareholders |  | $                               | (2.58   | ) |                                | $ | (0.16 | )    |  | $ | (2.12   | ) |  | $ | 0.09  |  

For the three and nine months ended September 30, 2005, there were 537,029 options and warrants outstanding
to purchase our common shares that were not included in the computation of diluted earnings per share because their inclusion would have been anti-dilutive.

For the three months ended September 30, 2006, there were 437,029 options and warrants outstanding to purchase our common shares that were not included in the computation of diluted loss per share because their inclusion would have
been anti-dilutive.

NOTE H - COMPREHENSIVE (LOSS) INCOME

The components of comprehensive (loss) income for the three and nine months ended September 30, 2005 and 2006 were:



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|                                          |  |                                |        |   |                               |   |      |      |  |   |        |   |  |   |      
|----------------------------------------- |  | ------------------------------ | ------ | - | ----------------------------- | - | ---- | ---- |  | - | ------ | - |  | - | -----
|                                          |  | Three Months EndedSeptember 30 |        |   | Nine Months EndedSeptember 30
|($ in thousands)                          |  | 2005                           |        |   | 2006                          |   |      | 2005 |  |   | 2006  
|Net (loss) income                         |  | $                              | (4,654 | ) |                               | $ | (868 | )    |  | $ | (3,171 | ) |  | $ | 524  
|Other comprehensive (loss) income:        |  |                                |        |   |                               |   |      |      |  |   |        |   |  |   |      
|Change in value of derivative, net of tax |  |                                |       |   |                               |   | (60  | )    |  |   |       |   |  |   | 1    
|Foreign currency translation adjustment   |  |                                | (63    | ) |                               |   | 737  |      |  |   | (713   | ) |  |   | 1,176
|                                          |  |                                |        |   |                               |   |      |      |  |   |        |   |  |   |      
|Comprehensive (loss) income               |  | $                              | (4,717 | ) |                               | $ | (191 | )    |  | $ | (3,884 | ) |  | $ | 1,701
|                                          |  |                                |        |   |                               |   |      |      |  |   |        |   |  |   |      

NOTE I - STOCK-BASED COMPENSATION

As permitted by SFAS No. 123, Accounting for Stock-Based Compensation (Statement No. 123), we had previously elected to follow Accounting Principles Board (APB) Opinion
No. 25, Accounting for Stock Issued to Employees and related interpretations in accounting for our employee option plans.

We had also
adopted the disclosure-only provisions of SFAS No. 123, Stock-Based Compensation and SFAS No. 148, Accounting for Stock-Based Compensation  Transition and Disclosure, which was released in December 2002 as an
amendment to Statement 123.

Under APB No. 25, no compensation expense was recognized at the time of the option grant if the exercise price of the
employee stock option was fixed and was at least equal to or greater than the fair market value of the underlying common stock on the date of grant and the number of shares to be issued pursuant to the exercise of such options were known and fixed
at the grant date.

On January 1, 2006, the Company adopted SFAS Statement No. 123(R), Share-Based Payment, using the modified
prospective method, whereby we apply Statement 123(R) to new and modified awards beginning January 1, 2006 and recognize compensation expense for the portion of outstanding unvested awards, based on the grant-date fair value of those awards.
The adoption of Statement 123(R) resulted in approximately $142,000 and $432,000 of share-based compensation expense for the three and nine months ended September 30, 2006.

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model for options granted prior to January 1, 2006 and a lattice based option model for option grants
issued in 2006. We are applying a lattice based option pricing model for new options as it allows for the variation of assumption inputs over time, thus, potentially resulting in a better estimate of fair value.

The following weighted-average assumptions were used for options granted during the nine months ended September 30, 2005 and 2006:



|                                |  |         |   |  |         |  
|------------------------------- |  | ------- | - |  | ------- | -
|                                |  | 2005    |   |  | 2006    |  
|Expected dividend yield         |  | 0       | % |  | 0       | %
|Expected stock price volatility |  | 45.10   | % |  | 53.80   | %
|Risk-free interest rate         |  | 4.00    | % |  | 4.74    | %
|Expected life of options        |  | 7 years |   |  | 7 years |  



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In 2005, if we had elected to recognize compensation expense based upon the fair value of the options granted at grant
date as prescribed by Statement No. 123, net income and related per share amounts would have been adjusted to the proforma amounts indicated in the table below:



|                                                                                                                                      |  |                                      |         |   |                                     |   |         |  
|------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------ | ------- | - | ----------------------------------- | - | ------- | -
|($ thousands, except per share amounts)                                                                                               |  | Three months endedSeptember 30, 2005 |         |   | Nine months endedSeptember 30, 2005 |  
|Net loss available to common shareholders - as reported                                                                               |  | $                                    | (14,558 | ) |                                     | $ | (13,075 | )
|Add: stock-based employee compensation expense included in reported net income, net of related tax effects                            |  |                                      |        |   |                                     |   |        |  
|Deduct: total stock based employee compensation expense determined under fair value method for all awards, net of related tax
effects |  |                                      | (57     | ) |                                     |   | (179    | )
|                                                                                                                                      |  |                                      |         |   |                                     |   |         |  
|Net loss available to common shareholders - pro forma                                                                                 |  | $                                    | (14,615 | ) |                                     | $ | (13,254 | )
|                                                                                                                                      |  |                                      |         |   |                                     |   |         |  
|Basic loss per share - as reported                                                                                                    |  | $                                    | (2.58   | ) |                                     | $ | (2.12   | )
|Basic loss per share - pro forma                                                                                                      |  | $                                    | (2.59   | ) |                                     | $ | (2.15   | )
|Diluted loss per share - as reported                                                                                                  |  | $                                    | (2.58   | ) |                                     | $ | (2.12   | )
|Diluted loss per share - pro forma                                                                                                    |  | $                                    | (2.59   | ) |                                     | $ | (2.15   | )

There were no options granted during the three months ended September 30, 2005 and 2006. The number of
options granted during the nine months ended September 30, 2005 and 2006 was 50,000 and 122,500, respectively. The weighted average fair value of options granted during the nine months ended September 30, 2005 and 2006 was $3.44 and $3.05
per share, respectively. We recognized compensation expense related to option grants of $142,000 and $432,000 for the three and nine months ended September 30, 2006, respectively.

The number of shares purchased through our various Stock Purchase Plans at 85% of the lower of the fair market value at the beginning or end of the quarter, was 22,647 and zero for the three months ended
September 30, 2005 and 2006, respectively, and 74,322 and 41,637 for the nine months ended September 30, 2005 and 2006 respectively. We recognized compensation expense related to our stock purchase plans of $0 and $37,000 for the three
months and nine months ended September 30, 2006, respectively.

NOTE J- GOODWILL AND OTHER INTANGIBLE ASSETS

The changes in the carrying value of goodwill by segment for the nine months ended September 30, 2006 are as follows:



|                              |  |                     |                |                     |   |                |  |              |        |  |   |       
|----------------------------- |  | ------------------- | -------------- | ------------------- | - | -------------- |  | ------------ | ------ |  | - | ------
|                              |  | U.S. MarketResearch |                | U.K. MarketResearch |   | SocialResearch |  | Consolidated
|                              |  |                     | (in thousands)
|Balance at December 31, 2005  |  | $                   | 2,390          |                     | $ | 2,732          |  | $            | 21,781 |  | $ | 26,903
|Foreign currency translation  |  |                     |               |                     |   | 258            |  |              |       |  |   | 258   
|                              |  |                     |                |                     |   |                |  |              |        |  |   |       
|Balance at September 30, 2006 |  | $                   | 2,390          |                     | $ | 2,990          |  | $            | 21,781 |  | $ | 27,161
|                              |  |                     |                |                     |   |                |  |              |        |  |   |       



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The components of intangible assets are as follows:



|                                          |  |                  |        |   |                   |   |      |  
|----------------------------------------- |  | ---------------- | ------ | - | ----------------- | - | ---- | -
|                                          |  | December 31,2005 |        |   | September 30,2006 |  
|                                          |  | (in thousands)   |       
|Intangible assets subject to amortization |  |                  |        |   |                   |   |      |  
|Non-competition agreements                |  | $                | 994    |   |                   | $ |     |  
|Other                                     |  |                  | 435    |   |                   |   | 476  |  
|                                          |  |                  |        |   |                   |   |      |  
|                                          |  | $                | 1,429  |   |                   | $ | 476  |  
|Accumulated amortization                  |  |                  | (1,205 | ) |                   |   | (246 | )
|                                          |  |                  |        |   |                   |   |      |  
|                                          |  | $                | 224    |   |                   | $ | 230  |  
|                                          |  |                  |        |   |                   |   |      |  

Amortization of intangible assets for the three and nine months ended September 30, 2005 was $51,000 and
$178,000, respectively. Amortization of intangible assets for the three and nine months ended September 30, 2006 was $5,000 and $14,000, respectively. The estimated aggregate amortization expense for the remainder of 2006 and each of the five
succeeding years is as follows:



|     |  |                |   
|---- |  | -------------- | --
|     |  | (in thousands)
|2006 |  | $              | 5 
|2007 |  |                | 19
|2008 |  |                | 19
|2009 |  |                | 19
|2010 |  |                | 19
|2011 |  |                | 19

NOTE K- SEGMENTS

We identify segments based on our internal reporting to management and our board of directors which reflects our geographic locations and industries in which we operate. We currently have three reportable segments: U.S. market research,
U.K. market research, and Social Research. We measure segment profits as operating profit, which is defined as income before interest and other non-operating expenses and income taxes. The U.S. market research segment includes unallocated corporate
headquarters expense. Information on segments and reconciliation to the consolidated total are as follows:



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|                                                        |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   |         |  
|------------------------------------------------------- |  | ------------------- | ------ | - | ------------------- | - | -------------- |  | -------------- | ------- | ----- | - | ------- | ---------------- | - | ----- | ------------ |  | ------ | - |  | - | ------- | -
|(in thousands)                                          |  | U.S. MarketResearch |        |   | U.K. MarketResearch |   | SocialResearch |  | Total Segments |         | Other |   |         | DivestedEntities |   |       | Consolidated | 
|Three months ended September 30, 2005                   |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   |         |  
|Revenues from external customers                        |  | $                   | 5,956  |   |                     | $ | 6,097          |  | $              | 34,064  |       | $ | 46,117  |                  | $ | 468   |              |  |        |   |  | $ | 46,585  |  
|Operating (loss) income                                 |  |                     | (685   | ) |                     |   | 210            |  |                | 3,302   |       |   | 2,827   |                  |   | (97   | )            |  |        |   |  |   | 2,730   |  
|Interest and other non-operating expense, net           |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | 2,784   |  
|Loss before income tax expense                          |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | (54     | )
|Provision for income tax expense- continuing operations |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | 551     |  
|Loss from continuing operations                         |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | (605    | )
|Loss from discontinued operations                       |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  | (4,049 | ) |  |   | (4,049  | )
|Net loss                                                |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | (4,654  | )
|                                                        |  |                     |        |   |                     |   |               
|Three months ended September 30, 2006                   |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   |         |  
|Revenues from external customers                        |  | $                   | 6,566  |   |                     | $ | 5,817          |  | $              | 34,701  |       | $ | 47,084  |                  | $ | 540   |              |  |        |   |  | $ | 47,624  |  
|Operating (loss) income                                 |  |                     | (396   | ) |                     |   | 160            |  |                | 3,203   |       |   | 2,967   |                  |   | (109  | )            |  |        |   |  |   | 2,858   |  
|Interest and other non-operating expense, net           |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | 2,752   |  
|Income before income tax expense                        |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | 106     |  
|Provision for income tax expense- continuing operations |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | 609     |  
|Loss from continuing operations                         |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | (503    | )
|Loss from discontinued operations                       |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  | (365   | ) |  |   | (365    | )
|Net loss                                                |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | (868    | )
|                                                        |  |                     |        |   |                     |   |               
|Nine months ended September 30, 2005                    |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   |         |  
|Revenues from external customers                        |  | $                   | 18,918 |   |                     | $ | 17,236         |  | $              | 104,118 |       | $ | 140,272 |                  | $ | 1,510 |              |  |        |   |  | $ | 141,782 |  
|Operating (loss) income                                 |  |                     | (1,390 | ) |                     |   | 284            |  |                | 10,654  |       |   | 9,548   |                  |   | (318  | )            |  |        |   |  |   | 9,230   |  
|Interest and other non-operating expense, net           |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | 5,961   |  
|Income before income tax expense                        |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | 3,269   |  
|Provision for income tax expense- continuing operations |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | 1,896   |  
|Income from continuing operations                       |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | 1,373   |  
|Loss from discontinued operations                       |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  | (4,544 | ) |  |   | (4,544  | )
|Net loss                                                |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | (3,171  | )
|                                                        |  |                     |        |   |                     |   |               
|Nine months ended September 30, 2006                    |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   |         |  
|Revenues from external customers                        |  | $                   | 20,717 |   |                     | $ | 16,933         |  | $              | 105,919 |       | $ | 143,569 |                  | $ | 1,391 |              |  |        |   |  | $ | 144,960 |  
|Operating (loss) income                                 |  |                     | (1,491 | ) |                     |   | 484            |  |                | 10,619  |       |   | 9,612   |                  |   | (460  | )            |  |        |   |  |   | 9,152   |  
|Interest and other non-operating expense, net           |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | 6,046   |  
|Income before income tax expense                        |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | 3,106   |  
|Provision for income tax expense- continuing operations |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | 2,079   |  
|Income from continuing operations                       |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | 1,027   |  
|Loss from discontinued operations                       |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  | (503   | ) |  |   | (503    | )
|Net income                                              |  |                     |        |   |                     |   |                |  |                |         |       |   |         |                  |   |       |              |  |        |   |  |   | 524     |  



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NOTE L  STOCKHOLDERS DERIVATIVE LAWSUIT

On December 2, 2004, several persons who purported to be stockholders of the Company filed a derivative complaint against the Company and its directors in the Chancery Court of the State of Delaware challenging
the decision to repurchase certain interests in the Company held by LLR. The plaintiffs alleged, among other things, that the purchase price the Company intended to pay for certain of the interests held by LLR would constitute a waste of corporate
assets. The complaint further alleged that, in approving the offering and the repurchase of the interests held by LLR, the directors did not act on the Companys behalf or on behalf of its stockholders but, rather, breached their fiduciary
duties of good faith and loyalty to the Company and its stockholders. Finally, the complaint alleged that Janney Montgomery Scott LLC (JMS), an independent valuation firm, materially overvalued the LLR interests in its opinion to the
Companys board of directors that the Companys repurchase of the LLR interests was fair, from a financial point of view, to the stockholders other than LLR. The complaint, however, did not assert any legal claims against JMS.

Thereafter, the Company and LLR modified the terms on which the repurchase would be completed, the Company issued senior subordinated notes to finance the repurchase
and, in July of 2005, the Company repurchased all of LLRs interests in the Company for $20 million. The plaintiffs then amended their complaint to challenge the repurchase as completed and alleged that the Company paid too much for the LLR
interests, that the directors breached their duties of good faith and loyalty in approving the repurchase on the modified terms and that JMS overvalued the LLR interests when it opined that the repurchase of the LLR interests was fair from a
financial point of view, to the stockholders other than LLR.

The defendants then moved to dismiss plaintiffs amended complaint arguing, among other
things, that it failed to state a claim for relief. At the conclusion of oral argument on May 1, 2006, the Court granted in part and denied in part defendants motion to dismiss.

Although the Court did not dismiss the plaintiffs amended complaint in full, the Board of Directors believes plaintiffs allegations lack merit and intends to
vigorously defend the actions challenged in the amended complaint. Because the lawsuit is a derivative action, if successful, it could result in the defendants owing damages to the Company. We have not accrued any expenses or benefits beyond
incurred legal costs.



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|ITEM 2. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|------- | -------------------------------------------------------------------------------------

The following Managements Discussion and Analysis of Financial Condition and Results of Operations (MD&A) includes forward-looking statements. In general, statements other than statements of
historical facts contained in this report, including statements regarding revenues, selling, general and administrative expenses, profitability, financial position, business strategy, and plans and objectives of management for future operations, are
forward-looking statements. The words believe, may, will, estimate, continue, anticipate, intend, expect and similar expressions, as they relate to us,
are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition,
results of operations, business strategy and financial needs. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including among other things:



| |  |  | fluctuations in demand for our services;
| | - |  | ----------------------------------------



| |  |  | competition;
| | - |  | ------------



| |  |  | our dependence on key personnel;
| | - |  | --------------------------------



| |  |  | government funding of social research projects;
| | - |  | -----------------------------------------------



| |  |  | leverage and debt service (including sensitivity to fluctuations in interest rates);
| | - |  | ------------------------------------------------------------------------------------



| |  |  | domestic and global economic, credit and capital market conditions;
| | - |  | -------------------------------------------------------------------



| |  |  | foreign exchange fluctuations;
| | - |  | ------------------------------



| |  |  | changes in tax laws or the administration of these laws;
| | - |  | --------------------------------------------------------



| |  |  | regulatory or judicial proceedings;
| | - |  | -----------------------------------



| |  |  | the outcome of the stockholders derivative litigation; and
| | - |  | -----------------------------------------------------------



| |  |  | certain other risks described under Item 1A, Risk Factors in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 31,
2006.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------

This list of risks is not exhaustive. We operate in a very competitive and rapidly changing environment. New risk factors emerge from
time to time and it is not possible for our management to predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ
materially from those contained in any forward-looking statements. We caution you not to place undue reliance on forward-looking statements, which speak only as of the date of this report. We assume no obligation to update any forward-looking
statements after the date of this report as a result of new information, future events or developments, except as required by federal securities laws.



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Overview

We provide
research services to governments and commercial clients in North America, Europe and Asia. We collect customer, market, employee and demographic data by utilizing computer-assisted telephone interviews, internet-based data collection techniques,
personal interviews, mail questionnaires, and other means. After collecting the data, we analyze, develop and present to our clients cohesive reports which provide insights regarding their programs, operations or, products and services. Our services
are designed to help our clients manage and evaluate public policy programs and funding decisions, sell products, and improve their corporate image and competitive position. Our government clients include some of the largest U.S. federal agencies
including the Substance Abuse and Mental Health Services Administration, the United States Agency for International Development, the Centers for Disease Control and Prevention, and the National Institutes of Health. We have served some of these
clients for over 20 years. Our commercial clients include a diverse base of major national and multi-national corporations in the automotive, consumer goods and services, energy, financial services, health care, information technology, retail and
trade, and telecommunications industries. We have served the commercial research market since 1938.

We currently have
three segments for financial reporting purposes:



| |  |  | Social Research;
| | - |  | ----------------



| |  |  | U.K. market research; and
| | - |  | -------------------------



| |  |  | U.S. market research.
| | - |  | ---------------------

Our consolidated revenues and operating income
increased in the three and nine months ended September 30, 2006 as compared to the same period in 2005, reflecting continued improvement in our social research and U.S. market research segments.

The following are factors that affect our results from operations:

Revenues: We generate our revenues from the hourly billings of professional labor, including part-time labor, from call center services, and from charging our clients for the out-of-pocket costs and
subcontracted services incurred for projects. In our market research and social research segments, revenues under fixed-price contracts are recognized on a proportional performance basis. Revenues under time-and-materials contracts and
cost-reimbursement contracts are recognized as costs are incurred. The level of our revenues is affected by government spending patterns, general economic conditions, the competitiveness of our service offerings in the marketplace and general market
conditions that influence the demand for our specific services and pricing.

Cost of revenues: All costs directly attributable to a project are
included in cost of revenues. These include the salary, benefits and incentive compensation expense for our professional staff and the hourly wages and benefits of our part-time staff engaged in project work. The cost of our professional staff is
relatively fixed over the short-term, and fluctuations in our gross margin may occur due to changes in project margins, the mix of project work that we perform, the level of part-time labor and other variable costs, and the utilization rates of our
staff. In addition we include project related telephone expense and out of pocket expenses, including travel, and subcontracted services incurred for project work, in cost of revenues, and the level of these expenditures will impact gross margin.

Selling, general and administrative expense: These include expenses that are not directly related to project performance, including salaries,
benefits and incentive compensation for executive



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management and support services including marketing, information technology, finance and human resources. Also included are external expenses including
insurance, legal, marketing, audit, office space and support service expenses, travel and training costs, directors fees and other non-project related expenses.

On January 1, 2006, we adopted SFAS Statement No. 123(R), Share-Based Payment, using the modified prospective method, whereby we apply Statement 123(R) to new and modified awards beginning
January 1, 2006 and recognize compensation expense for the portion of outstanding unvested awards, based on the grant-date fair value of those awards. The adoption of Statement 123(R) resulted in approximately $142,000 and $432,000 of
share-based compensation expense for the three and nine months ended September 30, 2006, respectively.

As of September 30, 2006, we estimated
$704,000 of unrecognized stock-based compensation expense relating to unvested awards. We expect to recognize this expense over a weighted average period of 1.5 years.

Interest expense: Our results in the three and nine months ended September 30, 2006 were impacted by interest expense on the unsecured subordinated debt financing which occurred in July 2005 and rising
interest rates on our variable debt.

Other non-operating expense: Our results in the three and nine months ended September 30, 2006 were
impacted by other non-operating expense due to costs incurred related to the infoUSA acquisition and legal expenses incurred arising from the stockholders derivative lawsuit.

infoUSA Acquisition

On August 4, 2006, we
entered into a definitive merger agreement pursuant to which the Company has agreed to be acquired by infoUSA Inc. in a transaction valued at approximately $134.3 million, including the assumption or repayment of debt. Under the terms of the
agreement, our stockholders will receive $12.00 per share in cash for each share of common stock they hold. Our Board of Directors has unanimously approved the agreement and will recommend that our stockholders approve the merger. The transaction is
expected to be completed in the fourth quarter of 2006 and is subject to receipt of stockholder approval and regulatory approval, as well as satisfaction of other customary closing conditions. A special meeting of stockholders will be held on
December 4, 2006 for the purpose of approving the proposed merger with infoUSA.

Results of Operations

The following table sets forth, for the periods indicated, selected operating data as a percentage of revenue:



|                                         |  |                                 |   |  |                                |   |  |       |   |  |       |  
|---------------------------------------- |  | ------------------------------- | - |  | ------------------------------ | - |  | ----- | - |  | ----- | -
|                                         |  | Three Months EndedSeptember 30, |   |  | Nine Months EndedSeptember 30, |  
|                                         |  | 2005                            |   |  | 2006                           |   |  | 2005  |   |  | 2006  |  
|Revenue                                  |  | 100.0                           | % |  | 100.0                          | % |  | 100.0 | % |  | 100.0 | %
|Gross Profit                             |  | 26.4                            | % |  | 27.8                           | % |  | 27.5  | % |  | 27.7  | %
|SG&A                                     |  | 18.7                            | % |  | 19.7                           | % |  | 19.3  | % |  | 19.4  | %
|Operating income                         |  | 5.9                             | % |  | 6.0                            | % |  | 6.5   | % |  | 6.3   | %
|(Loss) income from continuing operations |  | -1.3                            | % |  | -1.1                           | % |  | 1.0   | % |  | 0.7   | %
|Loss from discontinued operations        |  | -8.7                            | % |  | -0.8                           | % |  | -3.2  | % |  | -0.3  | %
|Net (loss) income                        |  | -10.0                           | % |  | -1.8                           | % |  | -2.2  | % |  | 0.5   | %



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Comparison of the three-month periods ended September 30, 2005 and 2006

Consolidated revenues increased $1.0 million, or 2.2%, from $46.6 million in the third quarter of 2005 to $47.6 million in the third quarter of 2006. Revenues increased
by $610,000 or 10.2% in the U.S. market research segment from $6.0 million in 2005 to $6.6 million in 2006. Revenues also increased $637,000, or 1.9%, in the social research segment from $34.1 million in 2005 to $34.7 million in 2006, while revenues
decreased $280,000, or 4.6%, in the U.K. market research segment from $6.1 million in 2005 to $5.8 million in 2006. The increase or decrease in revenues in the various operating segments was primarily due to higher or lower demand for services,
except for the U.K. market research, where the depreciation of the U.S. dollar relative to the U.K. pound has contributed to an increase of $257,000 in revenue.

Consolidated cost of revenues increased $123,000, or 0.4%, from $34.3 million in the third quarter of 2005 to $34.4 million in the third quarter of 2006, consistent with increased revenues. Gross profit as a percentage of revenues increased
from 26.4% in 2005 to 27.8% in 2006. In the U.S. market research segment, cost of revenues increased $187,000 or 4.3% from $4.3 million in 2005 to $4.5 million in 2006, while gross profit as a percentage of revenues increased from 27.3% in 2005 to
31.2% in 2006. In the social research segment, cost of revenues increased $220,000, or 0.9%, from $25.6 million in 2005 to $25.8 million in 2006, while gross profit as a percentage of revenues increased from 25.0% in 2005 to 25.7% in 2006. In the
U.K. market research segment, cost of revenues decreased $361,000, or 9.1%, from $4.0 million in 2005 to $3.6 million in 2006, while gross profit as a percentage of revenues in the U.K. market research segment increased from 35.1% in 2005 to 38.2%
in 2006. Cost of revenues in the U.K. market research was increased by $154,000 from currency fluctuations.

Selling, general and administrative
(SG&A) expenses increased $686,000 or 7.9% from $8.7 million in 2005 to $9.4 million in 2006. As a percentage of revenues, consolidated SG&A expenses increased from 18.7% in 2005 to 19.7% in 2006. In the U.S. market research
segment, SG&A expenses increased $204,000 or 9.7% from $2.1 million in 2005 to $2.3 million in 2006, or as a percentage of revenues, decreased from 35.3% in 2005 to 35.1% in 2006. The increase in the U.S. market research segment SG&A
expenses included share-based compensation expense of $142,000 resulting from our adoption of SFAS No. 123(R). SG&A expense in social research increased $370,000 or 7.8% from $4.8 million in 2005 to $5.1 million in 2006, while SG&A as a
percentage of revenues in the social research increased from 14.0% in 2005 to 14.8% in 2006. SG&A expense in the U.K. market research increased $109,000 or 6.3% from $1.7 million in 2005 to $1.8 million in 2006, while SG&A as a percentage of
revenues in the U.K. market research increased from 28.5% in 2005 to 31.8% in 2006. SG&A expense in the U.K. market research segment was increased by $89,000 due to currency fluctuations.

Depreciation and amortization expense increased $102,000, or 11.8%, from $864,000 in 2005 to $966,000 in 2006 as a result of increases in the related asset base in the
second half of 2005 and the first quarter of 2006 in the social research and U.K. market research segments, due to our investment in technology, offset by reductions in the U.S. market research business unit. As a percentage of revenues,
depreciation and amortization expense increased from 1.9% in 2005 to 2.0% in 2006.

Interest expense, net, increased $148,000, or 10.5%, from $1.4 million
in the third quarter of 2005 to $1.6 million in the third quarter of 2006 due to interest expense on the subordinated debt issued in July 2005 and rising interest rates on our variable rate debt.

Other non-operating expenses decreased $180,000, or 13.1%, from $1.4 million in the third quarter of 2005 to $1.2 million in the third quarter of 2006. The other
non-operating expenses in 2005 were incurred mainly due to a cancelled equity offering and, for 2006, infoUSA acquisition related costs and legal expenses incurred arising from the stockholders derivative lawsuit.



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The provision for income tax expense for the third quarter of 2005 and 2006 was $551,000 and $609,000, respectively. The
income tax provision is higher than statutory rates in 2005 and 2006 due to the fact that we are not deriving tax benefits from state and non-U.S. losses. In 2006, the income tax provision is further impacted by certain acquisition related expenses
not deductible for income tax purposes.

In December 2005, we divested our former teleservices business. We also commenced the closure of non-strategic
international market research operations due to inconsistent operating results and a determination that these operations were not strategic in providing the Companys services to its global clients. These closures were completed in the third
quarter of 2006. Loss from discontinued operations, net of tax, was $4.0 million and $365,000 in the third quarter of 2005 and 2006 respectively.

As a
result of the foregoing, net loss decreased from $4.7 million in the third quarter of 2005 to $868,000 in the third quarter of 2006.

During the third
quarter of 2005, we repurchased interests in the Company held by LLR. The transaction consisted of the repurchase of 1,176,458 common shares purchased by LLR on September 1, 2000, 740,500 warrants to purchase common shares, rights to convert
the common shares into preferred shares with an annual dividend obligation of $1.2 million, anti-dilution rights and warrants, as well as other rights. The transaction resulted in a $9.9 million increase in net loss available to common shareholders
from $4.7 million to $14.6 million.

Comparison of the nine-month periods ended September 30, 2005 and 2006

Consolidated revenues increased $3.2 million, or 2.2%, from $141.8 million in 2005 to $145.0 million in 2006. Revenues increased by $1.8 million, or 1.7%, in the social
research segment from $104.1 million in 2005 to $105.9 million in 2006. In the U.S. market research segment, revenues increased $1.8 million, or 9.5%, from $18.9 million in 2005 to $20.7 million in 2006. Revenues decreased by $303,000, or 1.8%, in
the U.K. market research segment from $17.2 million in 2005 to $16.9 million in 2006. The increase in revenues in the various operating segments was primarily due to higher demand for services, except for the U.K. market research, where the
appreciation of the U.S. dollar relative to the U.K. pound reduced revenues by $224,000.

Consolidated cost of revenues increased $2.0 million, or 2.0%,
from $102.8 million in 2005 to $104.8 million in 2006, consistent with increased revenues. Gross profit as a percentage of revenues increased from 27.5% in 2005 to 27.7% in 2006. In the social research segment, cost of revenues increased $1.4
million, or 1.8%, from $77.4 million in 2005 to $78.8 million in 2006, while gross profit as a percentage of revenues decreased from 25.7% in 2005 to 25.6% in 2006. In the U.S. market research segment, cost of revenues increased $1.1 million, or
8.4%, from $13.1 million in 2005 to $14.2 million in 2006, while gross profit as a percentage of revenues in the U.S. market research segment increased from 30.8% in 2005 to 31.5% in 2006. In the U.K. market research segment, cost of revenues
decreased $471,000 or 4.3% from $10.9 million in 2005 to $10.4 million in 2006, while gross profit as a percentage of revenues increased from 36.8% in 2005 to 38.4% in 2006, reflecting increased efficiency and productivity. Cost of revenues in the
U.K. market research was reduced by $138,000 from currency fluctuations.

SG&A expense increased $839,000 or 3.1% from $27.3 million in 2005 to $28.1
million in 2006. As a percentage of revenues, consolidated SG&A expenses increased from 19.3% in 2005 to 19.4% in 2006. In the U.S. market research segment, SG&A expenses increased $988,000 from $6.6 million in 2005 to $7.6 million in 2006,
or as a percentage of revenues, from 35.1% in 2005 to 36.8% in 2006. The increase in the U.S. market research segment SG&A expenses included share-based compensation expense of $432,000 resulting from our adoption of SFAS No. 123(R). The
increase



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was partially offset by a $29,000 decrease in the social research segment where SG&A was stable at $14.8 million, or as a percentage of revenues, a
decrease from 14.2% in 2005 to 13.9% in 2006, and a $124,000 decrease in the U.K. market research segment from $5.5 million in 2005 to $5.4 million in 2006, or as a percentage of revenues from 31.8% in 2005 to 31.6% in 2006. SG&A expense in the
U.K. market research segment was reduced by $71,000 from currency fluctuations.

Depreciation and amortization expense increased $388,000, or 15.7%, from
$2.5 million in 2005 to $2.9 million in 2006, as a result of increases in the related asset base in the second half of 2005 and first quarter in 2006 in the social research and U.K. market research segments, due to our investment in technology,
offset by reductions in the U.S. market research business unit. As a percentage of revenues, depreciation and amortization expense increased from 1.7% in 2005 to 2.0% in 2006.

Interest expense, net, increased $264,000, or 5.8%, from $4.5 million in 2005 to $4.8 million in 2006 due to interest expense from the subordinated debt issued in July 2005 and rising interest rates on our variable
rate debt, offset by a refinancing charge of $1.2 million in the March 2005 refinancing.

Other non-operating expenses decreased $179,000, or 12.6%, from
$1.4 million in 2005 to $1.2 million in 2006. The other non-operating expenses in 2005 were incurred mainly due to a cancelled equity offering and, for 2006, infoUSA acquisition related costs and legal expenses incurred arising from the
stockholders derivative lawsuit.

The provision for income tax expense for 2005 and 2006 was $1.9 million and $2.1 million, respectively. The income
tax provision is higher than statutory rates in 2005 and 2006 due to the fact that we are not deriving tax benefits from certain state and non-U.S. losses. In 2006, the income tax provision is further impacted by certain acquisition related expenses
not deductible for income tax purposes.

In December 2005, we divested our former teleservices business. We also commenced the closure of non-strategic
international market research operations due to inconsistent operating results and a determination that these operations were not strategic in providing the Companys services to its global clients. These closures were completed in the third
quarter of 2006. Loss from discontinued operations, net of tax, was $4.5 million and $503,000 in 2005 and 2006 respectively.

As a result of the foregoing,
net income increased from a loss of $3.2 million in 2005 to net income of $524,000 in 2006.

During the third quarter of 2005, we repurchased interests in
the Company held by LLR. The transaction consisted of the repurchase of 1,176,458 common shares purchased by LLR on September 1, 2000, 740,500 warrants to purchase common shares, rights to convert the common shares into preferred shares with an
annual dividend obligation of $1.2 million, anti-dilution rights and warrants, as well as other rights. The transaction resulted in a $9.9 million increase in net loss available to common shareholders from $3.2 million to $13.1 million.

Liquidity and Capital Resources

Cash Flows

At September 30, 2006, working capital was $20.5 million. Net cash provided by operating activities for the nine-month period ended
September 30, 2005 was $8.3 million compared to net cash provided by operating activities of $7.4 million for the same period in 2006. For the nine-month period ended September 30, 2005, the net cash provided by operating activities was
primarily generated by income from continuing operations of $1.4 million, adjusted for depreciation and amortization, and other non-cash items, totaling $3.6 million, increases in accrued expenses and other liabilities of $4.7 million,



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offset by decreases in accounts payable and deferred revenue of $896,000 and increases in unbilled services and other assets totaling $460,000. Net cash used
in operating activities of discontinued operations for the nine-month period ended September 30, 2005 was $608,000. For the same period in 2006, the net cash provided by operating activities was primarily generated by income from continuing
operations of $1.0 million, adjusted for depreciation and amortization, and other non-cash items, totaling $4.3 million, increases in accounts payable, accrued expenses, other liabilities and deferred revenue totaling $3.1 million, and a decrease in
billed accounts receivable of $4.3 million offset by increases in unbilled receivables and other assets totaling $5.3 million. Net cash used in operating activities of discontinued operations for the nine-month period ended September 30, 2006
was $72,000.

Investing activities for the nine-month period ended September 30, 2005 consisted of capital expenditures of $2.8 million as compared to
$2.0 million for the same period in 2006. The majority of the spending on capital items was for the replacement of technology. Capital expenditures incurred in discontinued operations for the nine month period ended September 30, 2005 was
$195,000.

Financing activities for the nine-month period ended September 30, 2005 included a net increase in borrowings of $17.1 million; payment for
the reacquisition of interests in the Company held by LLR for $20.0 million, plus transaction costs; proceeds from the sale of our common stock under our various stock purchase plans and the exercises of stock options totaling $477,000, payments of
loan origination and amendment fees of $495,000 and repayment under our capital leases of $145,000. Financing activities for the nine-month period ended September 30, 2006 included a net decrease in borrowings of $5.0 million, payments for loan
amendment fees and capital leases of $231,000 and $101,000, respectively, and proceeds of $686,000 from the sale of our common stock under our various stock purchase plans and exercise of options and warrants.

Credit Facilities

In May 2004, we entered into a secured
revolving credit facility of $35.0 million with Citizens Bank of Pennsylvania and First Horizon Bank (the Senior Revolving Facility). The Senior Revolving Facility was for a three-year term and is secured by substantially all of
our assets. In May 2006, we extended the maturity on the Senior Revolving Facility from May 3, 2007 to April 30, 2009. The Senior Revolving Facility carries an interest rate at our discretion of either the financial institutions
designated base rate (8.25% at September 30, 2006) plus 100 basis points or LIBOR (3-month LIBOR was 5.37% at September 30, 2006) plus 300 basis points. As of September 30, 2006, the amount outstanding was $22.8 million and there was
approximately $11.7 million of additional credit available under the Senior Revolving Facility.

In March 2005, we entered into a new secured term loan of
$15.0 million with Citizens Bank of Pennsylvania and First Horizon Bank (the Term Loan). The Term Loan is for a five-year term and is secured by substantially all of our assets. The Term Loan carries an interest rate of LIBOR plus 350
basis points, requires principal payments of $750,000 per quarter and matures in 2010. The proceeds from the Term Loan and a drawdown from the Senior Revolving Facility were used to prepay secured and unsecured subordinated notes in the combined
amount of $20.5 million. We wrote-off unamortized fees in the amount of $813,000 and incurred prepayment penalties in the amount of $362,000 in connection with this transaction in the first quarter of 2005.

In July 2005, we issued $20.0 million of unsecured subordinated notes to The Royal Bank of Scotland. These notes mature in July 2011, carry cash interest of 14% per
year and have no interim principal amortization. The proceeds from the issuance of these unsecured subordinated notes were used to finance the repurchase of interests in the Company held by LLR Equity Partners, L.P. and



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LLR Equity Partners Parallel, L.P. (the LLR Partnerships or LLR). The transaction consisted of (i) the repurchase of 1,176,458
common shares purchased by LLR on September 1, 2000; (ii) a warrant to purchase 740,500 common shares; (iii) rights to convert the common shares into preferred shares with an annual dividend obligation of $1.2 million;
(iv) anti-dilution rights and warrants; and (v) other rights.

We are required to maintain certain financial covenants under our credit
facilities, such as minimum earnings, debt-to-earnings, interest coverage, and other financial ratios. In addition, covenants under our credit facilities limit or prohibit our ability to incur additional debt, prepay specified types of indebtedness,
pay dividends, make investments, sell assets, or engage in mergers and acquisitions.

In September 2005, we entered into an interest rate cap agreement
with Citizens Bank to hedge our interest rate risk exposure on the Term Loan due to its variable interest rate. The interest rate cap qualified as a cash flow hedge pursuant to SFAS No. 133. The interest rate cap is set at a LIBOR rate of 4.5%,
has a remaining life matching the Term Loan, is based upon a notional amount of $13.5 million, and was purchased for a premium of $106,000. Changes in the fair value of the interest rate cap are reported as a component of Other Comprehensive Income.
Cash received from the interest rate cap arrangement is recorded as an offset to interest expense in the period or periods during which the interest rate on the Term Loan exceeds the interest rate cap.

For the three months ended September 30, 2006, the fair value of the interest rate cap decreased by approximately $90,000. For the nine months ended
September 30, 2006, the value of the interest rate cap increased by approximately $2,100. The change in the fair value of the interest rate cap, net of tax, is reflected in Other Comprehensive Income. For the three months and nine months ended
September 30, 2006, we have recorded cash received and expected receipt of approximately $23,000 and $40,000, respectively, as an offset to interest expense.

Capital Expenditures

We currently have no material capital expenditure commitments and no acquisition related commitments.

We believe that our current sources of liquidity and capital will be sufficient to fund our long-term obligations and working capital needs until April
2009, at which time our Senior Revolving Facility matures.

Critical Accounting Policies

The foregoing discussion of our financial condition and results of operations is based on the consolidated financial statements included in this Form 10-Q, which have
been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, sales
and expenses, and the related disclosures of contingencies. We base these estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making
judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

During the nine months ended September 30, 2006, there were no significant changes to the critical accounting policies we disclosed in Managements Discussion and Analysis of Financial Condition and Results of Operations in our
Annual Report on Form 10-K for the year ended December 31, 2005.



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##### Table of Contents

|ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
|------- | ---------------------------------------------------------

There
have been no significant changes in market risk since December 31, 2005 that would have a material effect on the Companys risk exposure as previously disclosed in the Companys Annual Report on Form 10-K for the year ended
December 31, 2005.

It has not been our practice to enter into foreign exchange contracts, but we may use such contracts in the future if we deem them
to be an appropriate resource to manage our exposure to movements in foreign currency exchange rates. We do not consider our current foreign exchange exposure, which is primarily related to changes between the U.S. dollar and the U.K. pound, to be
material. Although the impact of changes in foreign exchange rates may be significant to our revenues, cost of revenues and operating expenses when considered individually, the net impact on our results of operations has not been significant.

The following table provides information about the financial instruments that are sensitive to changes in interest rates. For debt obligations, the table
presents the expected principal cash flows and related weighted average interest rates as of September 30, 2006 by expected maturities.

Principal (Notional) Amount by Expected Maturity

Average Interest (Cap) Rate

(in thousands)



|                                          |  |      |  |       |  |       |  |        |  |      |  |        |  |             |  |        |  |                    
|----------------------------------------- |  | ---- |  | ----- |  | ----- |  | ------ |  | ---- |  | ------ |  | ----------- |  | ------ |  | -------------------
|                                          |  | 2006 |  | 2007  |  | 2008  |  | 2009   |  | 2010 |  | 2011   |  | There-after |  | Total  |  | FairValue at9/30/06
|Liabilities                               |  |      |  |       |  |       |  |        |  |      |  |        |  |             |  |        |  |                    
|Long-term debt including current portion: |  |      |  |       |  |       |  |        |  |      |  |        |  |             |  |        |  |                    
|Variable rate debt:                       |  |      |  |       |  |       |  |        |  |      |  |        |  |             |  |        |  |                    
|LIBOR + 3.0%, Prime +1%                   |  |     |  |      |  |      |  | 22,806 |  |     |  |        |  |            |  | 22,806 |  | 22,806             
|LIBOR + 3.5%                              |  | 750  |  | 3,000 |  | 3,000 |  | 3,000  |  | 750  |  |        |  |             |  | 10,500 |  | 10,500             
|Fixed rate debt - 14.0%                   |  |     |  |      |  |      |  |       |  |     |  | 20,000 |  |            |  | 20,000 |  | 18,957             
|Interest Rate Derivative Financial        |  |      |  |       |  |       |  |        |  |      |  |        |  |             |  |        |  |                    
|Instrument Related to Debt                |  |      |  |       |  |       |  |        |  |      |  |        |  |             |  |        |  |                    
|Interest Rate Cap:                        |  |      |  |       |  |       |  |        |  |      |  |        |  |             |  |        |  |                    
|Cap rate at 4.5%                          |  |     |  |      |  |      |  |       |  | 126  |  |       |  |            |  | 126    |  | 126                



|ITEM 4. | CONTROLS AND PROCEDURES
|------- | -----------------------

Our chief executive officer and chief
financial officer, with the assistance of management, evaluated the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange
Act) as of the end of the period covered by this report (the Evaluation Date). Based on that evaluation, our chief executive officer and chief financial officer concluded that, as of the Evaluation Date, our disclosure controls and
procedures were effective to ensure that information required to be disclosed in our reports under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commissions
rules and forms, and that such information is accumulated and communicated to management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosures.

There has not been any change in our internal control over financial reporting during the three and nine month periods ended September 30, 2006 that has materially
affected, or is reasonably likely to materially affect, our internal control over financial reporting.



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##### Table of Contents

PART II: OTHER INFORMATION

Item 1. Legal Proceedings

On December 2, 2004, several persons who purported to be stockholders of
the Company filed a derivative complaint against the Company and its directors in the Chancery Court of the State of Delaware challenging the decision to repurchase certain interests in the Company held by LLR. The plaintiffs alleged, among other
things, that the purchase price the Company intended to pay for certain of the interests held by LLR would constitute a waste of corporate assets. The complaint further alleged that, in approving the offering and the repurchase of the interests held
by LLR, the directors did not act on the Companys behalf or on behalf of its stockholders but, rather, breached their fiduciary duties of good faith and loyalty to the Company and its stockholders. Finally, the complaint alleged that Janney
Montgomery Scott LLC (JMS), an independent valuation firm, materially overvalued the LLR interests in its opinion to the Companys board of directors that the Companys repurchase of the LLR interests was fair, from a financial
point of view, to the stockholders other than LLR. The complaint, however, did not assert any legal claims against JMS.

Thereafter, the
Company and LLR modified the terms on which the repurchase would be completed, the Company issued senior subordinated notes to finance the repurchase and, in July of 2005, the Company repurchased all of LLRs interests in the Company for $20
million. The plaintiffs then amended their complaint to challenge the repurchase as completed and alleged that the Company paid too much for the LLR interests, that the directors breached their duties of good faith and loyalty in approving the
repurchase on the modified terms and that JMS overvalued the LLR interests when it opined that the repurchase of the LLR interests was fair from a financial point of view, to the stockholders other than LLR.

The defendants then moved to dismiss plaintiffs amended complaint arguing, among other things, that it failed to state a claim for relief. At the
conclusion of oral argument on May 1, 2006, the Court granted in part and denied in part defendants motion to dismiss.

Although
the Court did not dismiss the plaintiffs amended complaint in full, the Board of Directors believes plaintiffs allegations lack merit and intends to vigorously defend the actions challenged in the amended complaint. Because the lawsuit
is a derivative action, if successful, it could result in the defendants owing damages to the Company. We have not accrued any expenses or benefits, beyond incurred legal costs.

Item 1A. Risk Factors

Not Applicable.

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

None.

Item 3. Defaults upon Senior Securities

None.



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##### Table of Contents

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

None.



|Item 5. | Other Information
|------- | -----------------

None.



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



|     |  |                                                                                                                                                                                                                                                                                
|---- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2.1  |  | Agreement and Plan of Merger, dated August 4, 2006, among the Company, infoUSA Inc. and Spirit Acquisition, Inc. - Incorporated by reference to Exhibit 2.1 to the
Registrants Current Report on Form 8-K filed with the Securities and Exchange Commission on August 8, 2006.
|     | 
|2.2  |  | Amendment No. 1 to Agreement and Plan of Merger, dated as of October 16, 2006, among the Company, infoUSA Inc. and Spirit Acquisition, Inc.                                                                                                                                    
|     | 
|4.1  |  | Amendment No. 3 to Rights Agreement, dated August 4, 2006, between the Company and StockTrans Inc. - Incorporated by reference to Exhibit 4.1 to the Registrants Current
Report on Form 8-K filed with the Securities and Exchange Commission on August 8, 2006.              
|     | 
|4.2  |  | Rights Agreement, dated September 27, 2006, between the Company and StockTrans Inc. - Incorporated by reference to Exhibit 4.1 to the Registrants Current Report on
Form 8-K filed with the Securities and Exchange Commission on September 29, 2006.                         
|     | 
|10.1 |  | Executive Agreement with Frank J. Quirk entered into July 14, 2006 - Incorporated by reference to Exhibit 10.1 to the Registrants Current Report on Form 8-K filed
with the Securities and Exchange Commission on July 20, 2006.                                              
|     | 
|31.1 |  | Certification of Principal Executive Officer Pursuant to Rule 13a-15(e) or 15d-15(e) of the Exchange Act, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.                                                                                                
|     | 
|31.2 |  | Certification of Principal Financial Officer Pursuant to Rule 13a-15(e) or 15d-15(e) of the Exchange Act, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.                                                                                                
|     | 
|32.1 |  | Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                             
|     | 
|32.2 |  | Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                             



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SIGNATURE

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



|                        |  |  |  |                                                                                                                 
|----------------------- |  |  |  | ----------------------------------------------------------------------------------------------------------------
|                        |  |  |  | Opinion Research Corporation                                                                                    
|                        |  |  |  | (Registrant)                                                                                                    
|                        |  | 
|Date: November 13, 2006 |  |  |  | /s/ Douglas L. Cox                                                                                              
|                        |  |  |  | Douglas L. Cox Executive Vice President and Chief
Financial Officer (Principal Financial and Accounting Officer)



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