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  **SECURITIES AND EXCHANGE COMMISSION****Washington, D.C. 20549****FORM 10-KSB****(Mark One)**   þ **Annual Report under Section 13 or 15(d) of the Securities Exchange Act of 1934****For the fiscal year ended       November 30, 2006     **   o **Transition Report under Section 13 or 15(d) of the Securities Exchange Act of 1934****Forthe transition period from                      to                     ****Commission file number**      **1-13484**     **COHESANT TECHNOLOGIES INC.**(Exact name of Small Business Issuer in Its charter)   Delaware 34-1775913(State or Other Jurisdiction (I.R.S. Employerof Incorporation or Organization) Identification No.)5845 West 82nd Street, Ste. 102, Indianapolis, Indiana 46278   (Address of Principal Executive Offices) (Zip Code)Issuer’s Telephone Number, Including Area Code:  (317) 871-7611Securities registered pursuant to Section 12(b) of the Act: Common Stock, $.001 Par Valueregistered on the Nasdaq Capital MarketSecurities registered pursuant to Section 12(g) of the Act: None     Check whether the issuer is not required to file reports pursuant to Section 13 or 15(d) ofthe Exchange Act.  o     Check whether the issuer: (1) filed all reports required to be filed by Section 13 or 15(d)of the Exchange Act during the past 12 months (or for such shorter period that the registrant wasrequired to file such reports), and (2) has been subject to such filing requirements for past 90days. Yes þ   No  o     Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-Bcontained in this form, and no disclosure will be contained, to the best of registrant’s knowledge,in definitive proxy or information statements incorporated by reference in Part III of this Form10-KSB or any amendment to this Form 10-KSB.   þ     Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 ofthe Exchange Act). Yes o   No þ     State issuer’s revenues for its most recent fiscal year. $26,543,175.     State the aggregate market value of the voting stock held by non-affiliates computed byreference to the average bid and asked prices of such stock, as of January 31**,**2007**.**$13,935,868.     As of January 31, 2007, the Issuer had 3,285,997 shares of Common Stock, $.001 par value,outstanding.Documents incorporated by reference: None  

 
**TABLEOF CONTENTS**         **PAGE**PART I     Item 1. Description of Business 3 Item 2.   Properties 13 Item 3.   Legal Proceedings 13 Item 4.   Submission of Matters to a vote of Security Holders 14 PART II     Item 5. Market for Registrant's Common Equity and Related Stockholders Matters 14 Item 6.  Management's Discussion and Analysis of Financial Condition and Results of Operations 15 Item 7.   Financial Statements 22 Item 8.    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 22 Item 8A.     Controls and Procedures 22 Item 8B.    Other Information 23 PART III     Item 9.  Directors, Executive Officers, Promoters and Control Persons; Compliance with Section 16(a) 23 Item 10.   Executive Compensation 26 Item 11. Security Ownership of Certain Beneficial Owners and Management 29 Item 12. Certain Relationships and Related Transactions 30 Item 13.   Exhibits 30 Item 14.   Principle Accounting Fees and Services 32 Index to Financial Statements F-1 Signatures and Exhibits   EX-10.3 EX-10.4 EX-10.7 EX-21 EX-23 EX-31.1 EX-31.2 EX-32
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**FORWARD LOOKING STATEMENTS**          Certain statements contained in this report that are not historical facts are forward-lookingstatements that are subject to certain risks and uncertainties that could cause actual results todiffer materially from those set forth in the forward-looking statement. These risks anduncertainties include, but are not limited to, a slow-down in domestic and international marketsfor plural component dispensing systems, a reduction in growth of markets for the Company’s epoxycoating systems, customer resistance to Company price increases, the successful integration of theCuraFlo and Triton acquisitions and the Company’s ability to expand its franchising program andrehabilitation business.**PART I****ITEM 1. DESCRIPTION OF BUSINESS**     (a) General          Cohesant Technologies Inc. (the “Company” or “Cohesant”) was organized in 1994. SinceDecember 2005, the Company has conducted its operations through three wholly owned subsidiaries —GlasCraft Inc. (“GCI”), CIPAR Inc. (Cohesant Infrastructure Protection and Renewal or “CIPAR”), andCohesant Materials Inc. (“CMI”). GCI, the largest subsidiary, is engaged in the design,development, manufacture and sale of specialized dispense equipment systems, replacement parts andsupplies used in the operation of the equipment; CIPAR engages in the protection and renewal ofdrinking water distribution systems and wastewater collection systems for municipal, industrial,commercial and residential infrastructure; and CMI designs, develops, manufactures and sellsspecialty coatings.          Prior to August 2005, Cohesant had two subsidiaries, GCI and Raven Lining Systems Inc. RavenLining Systems manufactured and sold specialty structural and protective coatings through a networkof Certified Applicators. In August 2005, Cohesant acquired CuraFlo, a Vancouver based businessthat, through a network of licensed CuraFlo dealers utilized Raven’s specialty coatings to protectand renew drinking water pipes in single and multi-family residences, apartment buildings andcommercial buildings. Following the acquisition, in December 2005, in order to take advantage ofsupport and other synergies, Cohesant merged the CuraFlo Dealer Network and the Raven CertifiedApplicator Network to form CIPAR. Raven’s chemical manufacturing arm was renamed CohesantMaterials at that time.
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          The Company has four revenue categories — Equipment and Parts, Coatings, Licensee, andProtection and Renewal Services(Rehabilitation). As used herein, the term “Company” includes theoperations of Cohesant, GCI, CIPAR, and CMI unless the context indicates otherwise. The Company’sprincipal offices are located at 5845 West 82nd Street, Suite 102,Indianapolis, Indiana 46278. The Company’s web address is www.cohesant.com.          GCI manufactures, markets and sells high-quality equipment for metering, mixing and dispensingmultiple component formulations such as composites, polyurethanes, and polyureas. These equipmentsystems are commonly employed in the construction, transportation and marine industries to applyinsulation, protective coating, sealant and anti-corrosive products. GCI primarily sells itsproducts through independent distributors in the United States and overseas.          CIPAR is organized into two divisions: CIPAR Licensing and CIPAR Rehabilitation. CIPARLicensing provides protection and renewal services 1) through Dealers licensed to use the CuraFloEngineered Flow Lining SystemTM (the “CEFLS”) and operating under the CuraFlo® brand; 2) throughCertified Applicators trained and supported in the use of the Raven Engineered System; and3)starting in February 2007, CIPAR also began offering CuraFlo Franchises to qualified applicantsin certain geographic areas. CIPAR Rehabilitation operates three “company-owned” CuraFlo dealerswhich perform protection, renewal and replacement of plumbing lines using the CEFLS and othertechniques in Western Canada and the United States.          In September 2006, CIPAR added the Triton Spincast SystemTM (“TSS”) to its process offeringsthrough the acquisition of the assets of Triton Insitutech LLC. Like CEFLS, TSS is designed forthe protection and renewal of piping systems, but focuses on larger diameter pipes. TSS will bemarketed and sold by CuraFlo Dealers and Franchisees, but will be delivered on a subcontractingbasis by CuraFlo Spincast Services Inc. and reported as part of CIPAR Rehabilitation.          CMI manufactures, markets and sells corrosion protection and other specialty coatings used inthe protection and renewal of infrastructure. CMI represents the research and development andmanufacturing arms of the former Raven Lining Systems subsidiary and has a sales and marketingfocus on developing new markets for its AquataPoxy products. Currently substantially all of CMI’sCoating sales are to CIPAR.          For the years ended November 30, 2006 and 2005, the Company had net sales of $26,543,175 and$22,197,702, respectively, of
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which $15,854,495 and $14,528,485, respectively, were for equipment and parts, $6,156,953 and$6,470,706, respectively, were for coatings, $4,255,588 and $1,114,865, respectively, were forrehabilitation revenue and $276,139 and $83,646, respectively, were for licensee revenue.(b) Narrative Description of Business**PRODUCTS***CIPAR Inc.*          CIPAR operates through its two divisions — CIPAR Licensing and CIPAR Rehabilitation. CIPARLicensing in turn sells under two brands; Raven and CuraFlo. Net sales of Raven and CuraFlocoatings amounted to $5,854,439 and $5,946,259, representing 22.1% and 26.8% of net sales for thefiscal years ended November 30, 2006 and 2005, respectively. Net sales of coating equipmentamounted to $981,811 and $787,202, representing 3.7% and 3.5% of net sales for the fiscal yearsended November 30, 2006 and 2005, respectively. Rehabilitation revenue amounted to $4,255,588 and$1,114,865, representing 16.0% and 5.0% of net sales for the fiscal years ended November 30, 2006and 2005, respectively. Fiscal 2005 reflects less than four months of rehabilitation revenue afterthe August 2005 CuraFlo acquisition. Additionally, CIPAR had license revenue of $276,139 and$83,646, for the fiscal years ended November 30, 2006 and 2005, respectively.     *CIPAR Licensing.*     *Raven.*Raven engages in the protection and renewal of collection systems, treatment plantsand other government and industrial underground structures through its network of CertifiedApplicators. Raven Certified Applicators are trained to utilize the Raven Engineered systemconsisting of high performance structural and protective coatings manufactured by CMI and soldunder the Raven and AquataPoxy brands, specially designed application equipment and provenapplication and training methods.          Raven high performance sprayable epoxies are formulated for ultra high-build (20-250 mils percoat) application on concrete, masonry and steel surfaces providing protection from atmospheric andchemical corrosion. The high physical strengths of some Raven formulations permit the epoxy toenhance the structural integrity of damaged structures. Raven products can be quickly appliedunder harsh environmental conditions providing quick return to service and substantial savings forindustrial facilities by lessening downtime. The life span of the infrastructure exposed to theseconditions can increase
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dramatically with the use of Raven high performance protective coatings and linings. TheCompany’s unique high performance line of products and network of Certified Applicators provideaccess to specialty coating contractors and key end-users in the wastewater, pulp and paper,petrochemical, power and other industries.          Raven coatings are solvent-free, nontoxic, 100% solids epoxy products, emitting no volatileorganic chemicals VOC’s. Raven benefits significantly from increasing United States EnvironmentalProtection Agency (“EPA”) and Clean Air Act regulations.          Raven sells equipment, spare parts and supplies, which is used to apply its coatings.Typically, Raven does not sell equipment unless new Certified Applicators needing equipment areadded or existing applicators decide to increase their capacity by buying additional equipment.Additionally Raven had licensee revenue which is comprised of license, training and consulting feescharged to Certified Applicators.     *CuraFlo*. The CuraFlo Engineered Flow Lining System (“CEFLS”) consists of proprietaryequipment and processes and protective coatings (manufactured by CMI) to clean and line potablewater pipes in apartment buildings, private homes and other commercial, industrial and residentialbuildings. In the past, CuraFlo licensed the CEFLS to Licensed CuraFlo dealers and continues tosell and rent equipment, and provide value added services to its licensed dealers. CuraFlo focuseson the renewal and rehabilitation of water pipes in apartment buildings, private homes and othercommercial, industrial and residential buildings in Western Canada and the United States. CuraFlolicenses its technology to plumbers and/or mechanical contractors throughout North America. CEFLS,a proprietary technology known generically as “lining”, consists of know-how and methods first toclean the old metal pipes using an abrasive and then to refurbish the inner walls of the pipe withCuraPoxy, a proprietary epoxy manufactured and supplied by CMI. CuraPoxy is certified to ANSI/NSFStandard 61 for use in drinking water applications. Lining technology is considered a vastimprovement over the traditional “repipe” technique used to rehabilitate water pipes which consistsof ripping out the old pipes and replacing them with new piping. Lining technology is lessintrusive, offers quicker return to service and is more cost effective than repiping. Licensinghas provided the Company with consideration in the form of an up-front license fee and subsequentpayments for the purchase of equipment and epoxy coatings. A typical license agreement contains a10-year term and provides the licensee with an exclusive right to utilize the Company’s proprietypipe lining and restoration system within a specified geographical territory. Under the relatedsupply agreement a licensed dealer purchases
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equipment and epoxy for use in the pipe lining and restoration system. The arrangement provides thelicensed dealer with access to technical assistance, operational and other support from theCompany.          Starting in February 2007, CuraFlo began offering Franchisees to qualified applicants incertain geographies. The CuraFlo System offered to potential Franchisees includes thefollowing: the use of the CEFLS to clean and line potable water and drain, waste and vent pipesthat are between one half inch and four inches in diameter; professional image and rigid customerservice standards; our techniques for training qualified, certified technicians; our techniques formarketing services; our web site; and the accumulated experience reflected in our training programand operating procedures.     *CIPAR Rehabilitation*          *Rehabilitation Services.*Rehabilitation Services performs replacement and renewal of plumbinglines in Western Canada and the United States using both the renewal and repipe technologies. TheCompany uses these opportunities to continually refine its processes, provide hands on training toits licensees and develop markets for future licensing prospects. In September 2006, CuraFloSpincast Services Inc. was formed to perform protection and renewal of pipe larger than four inchesin diameter using the Triton Spincast System. CuraFlo Spincast Services will function as asubcontractor for CuraFlo Dealers, Raven Certified Applicators and others. In late 2006, theCompany formed CuraFlo Midwest to perform rehabilitation services in the Midwest and to be atraining ground for Franchisees.*GlasCraft Inc.*          GCI designs and manufactures a wide range of specialized dispense equipment systems, which areused to dispense multi-component formulations such as composite, polyurea and polyurethane coatingsand polyurethane foam. Net sales of dispense equipment systems amounted to $7,203,726 and$6,815,686 for the fiscal years ended November 30, 2006 and 2005, respectively, representing 27.1%and 30.7%, respectively, of net sales. A significant portion of the Company’s business is the saleof dispense guns, replacement and spare parts and supplies for its current and discontinueddispense equipment. The Company maintains an inventory of approximately 6,000 items to enable itto efficiently fill orders and service repairs. Net sales of dispense guns, replacement and spareparts and supplies amounted to $7,668,958 and $6,925,597, representing 28.9% and 31.2% of net salesfor the fiscal years ended November 30, 2006 and 2005, respectively.
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     *Composite dispense equipment systems.*GCI develops dispense equipment systems for both openand closed mold methods of composite product manufacturing. GCI’s dispense equipment systems canbe used to manufacture a wide variety of products, including such diverse products as boat hullsand construction components. The open mold method is ideally suited for small quantity and customproduction.          The United States Occupational Safety and Health Administration (“OSHA”) and environmentalregulatory agencies in the United States and abroad regulate the use of various VOC’s such asstyrene, acetone, methylene chloride and organic peroxides. These chemicals are often used in theprocess of fiberglass manufacturing. GCI primarily sells dispense equipment systems in thecomposite market outfitted with its patented Multiport Impingement Technology which reduces VOC’sand increases transfer efficiency. Multiport Impingement Technology is spray technology thatreduces atomization by increasing the size of the sprayed droplets, while maintaining a qualityspray pattern. Increased transfer efficiency results in less waste of product. GCI also sellsdispense equipment systems which utilize its patented Air Assist Containment (“AAC”) which improvescontainment of an atomized spray pattern. Improved containment limits emissions of VOC’s. Anincreasing portion of GCI’s composite equipment systems are used in Resin Transfer Molding (RTM)and RTM Lite closed mold processes. RTM, RTM Lite and other closed molded processes have theability to further reduce waste and pollutants.     *Polyurea and polyurethane coatings dispense equipment systems.*The Company designs andmanufactures equipment systems for dispensing polyurea and polyurethane coatings. A portion ofthese sales go to Original Equipment Manufacturers (OEM). Polyurea and polyurethane coatings areused to coat concrete in new construction, tanks, cargo beds and metal substrates. The Company’stechnology has many applications in the coatings industry. Consequently, the Company continuouslyseeks and develops new and different uses for its equipment systems. The Company, when necessary,will modify existing equipment system designs or will design new equipment systems to meet therequirements of new coatings as well as changing regulation and manufacturing methods.     *Polyurethane foam dispense equipment systems.*The Company also designs and manufacturesequipment systems for dispensing polyurethane foam. Polyurethane foam is used for commercial andresidential insulation, packaging, flotation devices and many other uses.
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*Cohesant Materials Inc.*          CMI manufactures, develops, markets and sells corrosion protection and other specialtycoatings used in the protection and renewal of infrastructure. Currently substantially all ofCMI’s Coating sales are to CIPAR. Net sales of coatings to customers other than CIPAR amounted to$302,514 and $524,447, representing 1.1% and 2.4% of net sales for the fiscal years ended November30, 2006 and 2005, respectively.          *AquataPoxy Products*. The AquataPoxy line of solvent-free epoxy coating products are designedto extend the life of a structure by protecting it from corrosion. These products are formulatedto have high performance characteristics such as excellent resistance to moisture, corrosion andchemical attack. AquataPoxy products are used in the construction, repair, rehabilitation andmaintenance of food processing and water storage structures, commercial and residential water pipelining, wastewater treatment and collection systems of municipalities and industrial andrecreational facilities. AquataPoxy products are unique with their high moisture tolerantcharacteristics that allow them to be applied to underwater and moisture filled concrete surfaces.AquataPoxy products are ideally suited for the rapidly growing market in underground rehabilitationof infrastructure. AquataPoxy products are specified for use by many engineers and governmentalagencies in connection with the rehabilitation of potable and/or wastewater facilities by trainedapplicators.          AquataPoxy products contain no solvents or VOC’s. Properly applied, AquataPoxy products areinert once cured and do not release harmful by-products into air, water or the environment.Conversely, competitive solvent-borne coatings have the potential to release carcinogens and otherhazardous substances into the environment and generally are not desirable for applications thatinvolve contact with food, drinking water, animals or people. AquataPoxy is certified to ANSI/NSFStandard 61 for use in drinking water applications and meets qualifications of the United States Department of Agriculture for agriculturalapplications, food processing and potable water facilities and marine environments.**MARKETING**     *Distributors, Certified Applicators and Licensed Dealers*          Most of the Company’s products are sold through a growing network of independent distributors,Certified Applicators and Licensed Dealers in the United States and overseas. A portion of theCompany’s sales are made directly to end-users and OEM accounts by Company sales personnel.
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          Generally, the products of GCI are sold through a network of independent domestic andinternational factory authorized equipment distributors. Most of these distributors are engaged inthe sale of polyester resins and gel coats, fiberglass strand and mat, polyurethane foams andcoatings and similar items. Many of the international distributors sell only industrial equipment.In the fiscal years ended November 30, 2006 and 2005, GCI’s ten largest distributors accounted for38% and 37% of equipment system and dispense guns, replacement and spare parts sales, respectively.Of the foregoing, four of the distributors in fiscal 2006 and five of the distributors in fiscal2005 were internationally based. GCI provides training to the distributors and customers in theuse of its equipment systems and products.          CIPAR markets its licenses and products primarily through its network of independent LicensedDealers and Certified Applicators. The Company presently has forty-eight domestic CertifiedApplicators and one international Certified Applicator and 13 independent Licensed Dealers. Forthe fiscal years ended November 30, 2006 and 2005 the Company’s ten largest Certified Applicatorsand Licensed Dealers accounted for 62% and 66%, respectively, of coating product sales.Additionally, CIPAR’s rehabilitation services are marketed to property managers and owners ofapartment buildings, private homes and other commercial, industrial and residential buildings.Starting in February 2007, CuraFlo began offering Franchisees to qualified applicants in certaingeographic areas.  *Brochures, Advertising and Trade Shows*          The Company supports its marketing with brochures, sales catalogues, direct mailings and mediainsertions in various trade publications. In connection with coating products, the Company alsoprepares media promotion kits and product demonstration kits for use by Certified Applicators anddistributors. Company personnel, representatives and distributors attend trade shows in the UnitedStates and overseas. Typically, potential customers and distributors attend these shows. Inaddition, these shows afford the Company the opportunity to keep abreast of its competitors’products and developments in the industry. Company personnel also participate in various industryorganizations and work with complementary technologies to present educational and technicalseminars. These seminars assist in industry growth and guide prospective customers to theCompany’s products and methods.
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**MANUFACTURING AND RAW MATERIALS SUPPLY**     The Company assembles its dispense equipment system products from commercially availablecomponents and components manufactured to specification by a variety of vendors. The Companyperforms minimal fabrication of components. The Company is not dependent upon any single vendorfor the conduct of its business, and generally has alternative sources for all necessarycomponents.     Similarly, there are a number of alternative sources of the raw materials used in themanufacture of the coating products of the Company. The Company maintains good workingrelationships with major resin suppliers. The Company does not believe that it is dependent on anyone vendor of raw materials for its coating products and the Company does not believe the loss ofany one supplier would have a material adverse impact on the Company.**COMPETITION**     The markets for all of the Company’s products and services are highly competitive. TheCompany competes with numerous well-established companies, most of which possess substantiallygreater financial, marketing, personnel and other resources than those of the Company.     There are a number of competitive equipment manufacturers, which include Graco Inc. andMagnumVenus Plastech. Coating competitors include Carboline Company, Tnemec Company, Inc. andSauereisen. Licensing and rehabilitation competitors include ACE DuraFlo on a national level andvarious regional players. The Company competes by increasing customer awareness of its technologyand quality products, by offering its products at a competitive price, and through product lineextensions.     The markets for the Company’s products are characterized by changing technology and industrystandards. Accordingly, the ability of the Company to compete is dependent upon the Company’sability to complete development and effectively market its technology and state-of-the-artequipment and coating products.**RESEARCH AND DEVELOPMENT**     The Company has a research and development program to continually improve its existingproducts, to develop new products and to custom engineer equipment and products to meet specificcustomer requests. In fiscal 2006, the Company introduced its newly developed and patent pendingGuardian A series dispense systems, Guardian MMH dispense system and the
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Formula X gun. In fiscal 2005, the Company introduced its patented Probler P2 gun and Formula gun.The Company has eleven full-time and one part-time employees devoted to research and development.Virtually all of the products marketed by the Company were developed internally, either by theCompany or its predecessors. Research and development expenses for the fiscal years ended November30, 2006 and 2005 were $1,164,229 and $990,224, respectively, or 4.4% and 4.5%, respectively of netsales. The Company expects this level of research and development expense to continue or slightlyincrease in the future.**GOVERNMENT REGULATION**     The Company is subject to regulations administered by the EPA, OSHA, various state agencies,county and local authorities acting in cooperation with Federal, state and Canadian authorities andinternational governmental regulatory agencies. Among other things, these regulatory bodies imposerestrictions to control air, soil and water pollution, to protect against occupational exposure tochemicals, including health and safety risks, and to require notification or reporting of thestorage, use and release of certain hazardous chemicals and substances. The extensive regulatoryframework imposes significant compliance burdens and risks on the Company’s operating subsidiaries.Governmental authorities have the power to enforce compliance with these regulations and to obtaininjunctions or impose civil and criminal fines in the case of violations.     The Company has in place programs to achieve and maintain substantial compliance with thecurrently existing environmental and worker exposure laws and regulations, which materially affectthe Company’s continuing businesses. As of the date of this Report, based on its experience andconsultations with environmental consultants, management believes that the Company is taking or hastaken all necessary measures to comply with applicable Federal, state and local environmental lawsand regulations and worker exposure regulations.     As a product exporter, the Company is subject to import and other regulations by internationalgovernments. While the Company currently does not experience any significant difficulties withexports, future changes to international laws and regulations could impact international sales.**PATENTS, TRADEMARKS AND PROPRIETARY INFORMATION**     The Company holds several U.S. patents and patent applications, all of which are applicable tothe Company’s
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specializedtwo component dispense equipment. No single patent is material to the Company. The Company’s patents expire at various times in the future through2022. In fiscal 2006, GCI received two patents and has four applications pending covering theProbler P2 gun. Also, GCI has two applications pending covering the Guardian dispense system.     The Company believes that product recognition is an important competitive factor in theequipment and chemical industries. Accordingly, the Company holds a United States trademarkregistration for AACâ, AquataPoxyâ, CuraFloâ,CuraPoxyâ, GlasCraftâ, Guardianâ andRavenâand has several trademark applications pending. The Company promotes thesetrade names in connection with its marketing activities.     The Company also relies on proprietary know-how and confidential information and employsvarious methods to protect the processes, concepts, ideas and documentation associated with itsproducts.**EMPLOYEES**     As of January 26, 2007, the Company employed 124 full time and 5 part time persons. TheCompany believes its relations with its employees are good.**ITEM 2. PROPERTIES**     The Company’s executive offices are located in Indianapolis, Indiana, with its principalmanufacturing, warehouse and distribution facilities located in or near Cleveland, Ohio,Indianapolis, Indiana, Tulsa, Oklahoma and Vancouver, Canada. GCI leases approximately 51,200square feet of office, manufacturing and warehouse space in Indianapolis, Indiana through January2009. CMI leases approximately 15,000 square feet of combined office and manufacturing space nearTulsa, Oklahoma through March 2011. CIPAR’s Vancouver operation leases approximately 4,100 squarefeet of combined office and warehouse space through August 2009. CIPAR expanded its operationsduring the first quarter of fiscal 2007 by adding approximately 15,000 square feet of office andwarehouse space near Cleveland, Ohio leased through July 2012.**ITEM 3. LEGAL PROCEEDINGS**     The Company is a party to certain legal matters arising in the ordinary course of business.Management believes the ultimate disposition of these matters will not have a material
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adverseeffect on the Company’s financial position or results of operations.**ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**     No matters were submitted to a vote of the Company’s shareholders during the fourth quarter ofthe fiscal year ended November 30, 2006.**PART II****ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDERS MATTERS**     The Common Stock of the Company is quoted on the Nasdaq Capital Market under the symbol“COHT”.     The following table sets forth the high and low prices of the Company’s Common Stock for eachquarter in the two year period ended November 30, 2006, as reported by Nasdaq.**CommonStock**                High LowYear Ended November 30, 2005        First Quarter $15.38  $9.22 Second Quarter  10.98   7.06 Third Quarter  10.00   8.00 Fourth Quarter  9.80   7.36          Year Ended November 30, 2006        First Quarter $10.00  $7.04 Second Quarter  12.50   9.75 Third Quarter  12.03   9.13 Fourth Quarter  10.45   8.14      Substantially all of the holders of common stock maintain ownership of their shares in“street name” accounts and are not, individually, shareholders of record. At November 30, 2006,the Company believes there are in excess of 1,000 beneficial owners of common stock, althoughthere are only 70 holders of record.     The following table depicts the dates and payments of dividends made in fiscal 2006 and 2005.           Per    ShareRecord Date Payment Date AmountNovember 17, 2006 November 30, 2006 $0.14 May 22, 2006 June 5, 2006  0.14 November 18, 2005 November 30, 2005  0.135 May 18, 2005 May 27, 2005  0.135 
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     The Board of Directors reviews the dividend policy on at least a semi-annual basis to ensuresufficient cash availability for capital expenditures and potential acquisitions.     The following table sets forth certain information regarding the Company’s equity compensationplans as of November 30, 2006:               Number of securities  Weighted-average      to be issued upon  exercise price of  Number of securities   exercise of  outstanding  remaining available for   outstanding options,  options, warrants  future issuances under Plan Category warrants and rights  and rights.  equity compensation plans. Equity compensationPlans approved bySecurity holders  306,384(1) $7.39   67,266(2)             Equity compensationPlans not approvedby Security holders  65,525(3)  N/A   0                        Total  371,909  $7.39   67,266  (1) Represent shares granted under the Company’s 1994 Employee Stock Option Plan,as amended and the Company’s 2005 Long-Term Incentive Plan. (2) Represent shares available for grant under the Company’s 2005 Long-TermIncentive Plan. (3) Represents restricted stock awards granted to employees in fiscal 2004. AtNovember 30, 2006, 8,175 of these shares were not vested.**ITEM 6. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS****Acquisition**     We maintain a strategy for growth through steady organic expansion supported by selectacquisitions. Our long-term strategic plan is to be a global leader providing technologies forinfrastructure rehabilitation and protection.Triton     On September 5, 2006 the Company completed the purchase of the operations and assets of TritonInsitutech, LLC, of Orlando, Florida. The Triton SpinCast System utilizes epoxy and other polymerlinings to rehabilitate aging medium and large diameter water, wastewater and other pipelines,including public and private water mains. Triton, now known as CuraFlo SpinCast Services, isreported as part of the Company’s CIPAR Rehabilitation division and is expected to benefit from asignificant marketing relationship with the Company’s CuraFlo dealer network.
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     Acquisition consideration included an initial cash payment of $400,000, an unsecured $387,500three-year promissory note bearing interest at 5.16% per annum paid in quarterly installments andan additional unsecured three-year, $387,500 promissory note, which is contingent on certainperformance achievements and payable on an annual basis. In addition, the Company incurred $30,825of direct legal costs related to the acquisition.CuraFlo     On August 12, 2005, the Company acquired substantially all of the assets and assumed certainliabilities of 4279 Investments Ltd., a British Columbia corporation, and its subsidiaries, CuraFloTechnologies Inc., a Canadian federal company, Curalease Ltd., a British Columbia corporation,CuraFlo Technologies (Canada) Inc., a British Columbia corporation, CuraFlo of BC Inc. (dba WestCoast Pipe Restoration Ltd.), a British Columbia corporation, CuraFlo Technologies (USA) Inc., aNevada corporation, and CuraFlo of the Silicon Valley, Inc., a California corporation (collectively“CuraFlo”). CuraFlo, formerly based in Vancouver, Canada, licenses technology for the protectionand renewal of small diameter water pipes. The process is used to rehabilitate aging water pipesin apartment buildings, private homes and other commercial, industrial and residential buildings.This process is an alternative to the process of tearing out and replacing the old pipes. CuraFloalso provides equipment, epoxy (supplied by CMI) and other supplies to its licensees. In additionCuraFlo performs protection, renewal and replacement of plumbing lines in Western Canada and theUnited States. The integration of CuraFlo into Cohesant’s brand portfolio enables the Company toextend its infrastructure protection and rehabilitation offerings beyond its historical municipalfocus by adding CuraFlo’s industry position in the commercial and light industrial sectors and itsoperations in the residential sectors.     Acquisition consideration consisted of $4,104,000 in cash and 461,124 shares of non-registeredcommon stock valued at $4,265,397 based on the closing price of Cohesant’s stock on the acquisitiondate. In addition, the Company incurred $519,885 of direct costs related to the acquisition,including primarily legal and accounting fees. A portion of the purchase price was deposited intoan escrow account to secure customary indemnity and other obligations of the Sellers that may arisepost-closing. The escrow expires on August 12, 2010. The assumed liabilities of $768,022 includea $342,136 payment made in the
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first quarter of fiscal 2006 to the Sellers relating to a closingdate working capital adjustment required by the purchase agreement. During the first quarter offiscal 2006, $77,250 cash and 7,500 shares werepaid from the escrow to the Company to resolve outstanding claims; another 75,000 shares werereleased from escrow to the Sellers. At November 30, 2006, there were 149,241 shares remaining inescrow.**Results of Operations**     *Fiscal Year Ended November 30, 2006 as compared to Fiscal Year Ended November 30, 2005*     Net sales for the fiscal year ended November 30, 2006, were $26,543,175 representing anincrease of $4,345,473 or 19.6%, from fiscal 2005 net sales of $22,197,702. Equipment and Partssales increased $1,326,010 or 9.1%, while Coatings sales decreased $313,753 or 4.8%. Additionally,the Company had Rehabilitation and License revenue of $4,255,588 and $276,139, respectivelycompared to $1,114,865 and $83,646, respectively, in the 2005 period. Net income was $1,577,157,an $51,022 or 3.1% decrease from last year.     During 2006, Cohesant expended approximately $225,000 on one time costs associated with thestart-up of 1) the Company’s new franchise program which launched in February 2007; 2) a newCompany owned CuraFlo Dealer in Cleveland, Ohio and 3) CuraFlo Spincast Services, a new businessoffering the Triton Spincast System to CuraFlo Dealers, Raven Certified Applicators, and others ona subcontracted basis. The Company expects additional start-up costs to be incurred in early fiscal2007. Additionally, during the fourth quarter of 2006 and continuing into fiscal 2007, Cohesanthas added and will add personnel and other overhead expenses relating to these three newbusinesses. The Company believes that this investment in its future is both prudent and necessaryto support and grow these important new businesses. Until the new businesses begin to producerevenues, these additional overhead expenses will adversely affect the Company’s net income.Management anticipates these businesses will begin to produce meaningful revenues in the secondhalf of fiscal 2007 and be fully operational in fiscal 2008.     CIPAR’s net sales increased $3,436,005, or 43.3% to $11,367,977. Coatings sales were$5,854,439 compared to $5,946,259 in the prior period, a decrease of $91,820, or 1.5%. CIPAR hadEquipment and Parts sales of $981,811 compared to $787,202 for the comparable period last year.Typically, CIPAR does not sell equipment unless new Licensed Dealers or Certified Applicatorsneeding equipment are added or existing dealers and applicators decide to increase capacity bybuying additional equipment. Additionally CIPAR had Rehabilitation revenue of $4,255,588 andLicensee revenue of $276,139. CIPAR had
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$1,114,865 Rehabilitation revenue and $83,646 Licenseerevenue in the 2005 period. The increase in rehabilitation revenue reflectsa full year’s activity compared to the less than four month’s activity post acquisition in2005. License revenue includes license fees, equipment rental and other value added services.Rehabilitation revenue is derived from replacement and renewal of plumbing lines.     GCI’s net sales increased $1,131,401 or 8.2% to $14,872,684. This increase was primarilyattributable to increased sales of polyurethane foam systems, resulting from the introduction ofthe new Guardian dispense system, increased spare and replacement parts sales and, to a lesserextent, increased composite dispense system sales. This sales increase was partially offset bydecreased sales of coatings dispense systems. International Equipment and Parts sales were up11.9%, while domestic Equipment and Parts sales were up 5.8%. The increase in international saleswas reflective in most geographic areas.     CMI’s net sales were $302,514 compared to $524,447 for the comparable 2005 period. Theprimary reasons for this decrease is that for most of 2005 sales to CuraFlo were classified asexternal sales, but following the August 2005 acquisition, sales to CuraFlo were reclassified asintercompany sales. Following the acquisition, the Company elected not to sell CuraPoxy toexternal customers.     The Company’s gross margin increased to $12,201,125, or 46.0% of net sales, in the 2006 periodfrom $10,394,707, or 46.8% of net sales, in the 2005 period. The dollar increase was primarily dueto increased sales at CIPAR and to a lesser extent increased sales at GCI. Equipment, Coatings andRehabilitation margin percentages have all improved; however margins on Rehabilitation Revenue –which historically have lower gross margins than any of the Company’s other revenue categories –lowered the Company’s overall gross margin percentage.     Research and development expenses were $1,164,229 and $990,224 for the fiscal years endedNovember 30, 2006 and 2005, respectively. This increase of $174,005, or 17.6% was primarilyattributable to increased costs at GCI and to a lesser extent CMI. In fiscal 2006 GCI introducedits newly developed and patent pending Guardian A series dispense systems, Guardian MMH dispensesystem and the Formula X gun.     Selling, general and administrative expenses were $8,523,554 and $6,987,629 for the fiscalyears ended November 30, 2006 and 2005, respectively. This increase of $1,535,925, or 22.0% wasprimarily attributable to increased sales and marketing and
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administrative costs at CIPAR(reflective of the CuraFlo and Triton acquisitions), costs incurred relating to the development ofCuraFlo Franchise program launched in the first quarter offiscal 2007 and increased sales and marketing expenses (increased personnel and various othercosts) at GCI.     Other income, net of other expenses for the fiscal year ended November 30, 2006, decreased$77,779 to $32,194. This decrease was primarily attributable to decreased interest earned on lowercash balances.     The effective tax rate for the years ended November 30, 2006 and 2005 was 38.0% and 35.6%,respectively.**Liquidity and Capital Resources**     The Company’s primary sources of liquidity are its cash reserves, cash provided by operations,and availability under the revolving line of credit. At November 30, 2006 the Company hascash of $1,318,607, net working capital of $6,582,099 and $3,500,000 available under therevolving line of credit.     For the fiscal year ended November 30, 2006 cash provided by operations was $1,870,218compared to $3,146,571 in the prior year. This decrease was primarily attributable to increasedinventory and accounts receivable balances at GCI resulting from new product introductions andincreased sales and a decrease in other current liabilities due to timing differences and reducedincentive payments to employees. Cash usage in investing activities decreased to $2,273,877 in thecurrent period from $5,160,244 in the prior year period. This decrease was attributable to thecash payment made in 2005 for the CuraFlo acquisition, partially offset by increased spending in2006 on leasehold improvements, website development and capital equipment (enterprise system, phonesystem, pipe lining equipment and office furniture). Cash used in financing activities was $516,015in the current period compared to $784,628 in the prior year period. This decrease was primarilydue to the cash received from the exercise of stock options and timing differences in the paymentof dividends to the shareholders.     On June 20, 2006, the Company announced that its Board of Directors approved a sharerepurchase program of up to 100,000 of its issued and outstanding shares of common stock. InSeptember 2006, the Company repurchased and retired 10,000 shares of common at a cost of $88,300.     On April 26, 2006, the Company renewed, through May 1, 2007, its $3,500,000 unsecuredrevolving line of credit facility. This
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facility accrues interest at the bank’s prime lendingrate. Among other restrictions, the credit facility requires that the Company meet certaincovenants including financial ratios. The Company does not foresee any problems renewing thisfacility orobtaining an equivalent facility from another lender. As of November 30, 2006, the Company was incompliance with all covenants and did not have a balance outstanding under this facility.     The Company has paid dividends of $0.28 and $0.27, in fiscal 2006 and 2005, respectively. TheBoard of Directors reviews the dividend policy on at least a semi-annual basis to ensure sufficientcash availability for capital expenditures, potential acquisitions, and dividends.     The Company does not have any other significant commitments or guarantees except for rentalcommitments, which are disclosed in Note 11 to the Consolidated Financial Statements.     The Company believes that its cash flow from operating activities, existing cash resources andworking capital coupled with its bank line will be adequate to meet its capital needs for theforeseeable future.**Critical Accounting Policies**     The Company has disclosed those accounting policies that it considers to be significant indetermining the amounts to be utilized for communicating its consolidated financial position,results of operations and cash flows in the notes to its consolidated financial statements.     The preparation of financial statements in conformity with these principles requiresmanagement to make estimates and assumptions that affect amounts reported in the financialstatements and accompanying notes. Management continually evaluates the information used to makesuch estimates as its business and economic environment changes and has discussed these estimateswith the Audit Committee of the Board of Directors. Actual results are likelyto differ from these estimates, but management does not believe such differences will materiallyaffect the Company’s financial position or results of operations.     The following accounting policies represent the most critical based on management’s analysisdue the impact on the Company’s results of operations.     *Revenue Recognition.*The Company recognizes revenue in accordance with SEC Staff AccountingBulletin No. 104, “Revenue Recognition” (“SAB 104”). Under SAB 104 revenue is recognized
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when thereis persuasive evidence of an arrangement, delivery has occurred or services have been rendered, thesales price is fixed or determinable, and collectibility is reasonably assured.     For equipment, coatings, and replacement and spare part revenue, the criteria of SAB 104 aregenerally met upon shipment to independent distributors, certified applicators, large end users andOriginal Equipment Manufacturer accounts, at which time title and risks ownership are transferredto these customers. Therefore, revenue is recognized at the time of shipment. The Company does nothave any rights of return, customer acceptance, installation or other post-shipment obligationswith any of these products. The Company’s pricing is fixed at the time of shipment.     Rehabilitation revenues are recognized on the percentage of completion method in the ratiothat total incurred costs bear to total estimated costs. The estimated total cost of a contract isbased on management’s best estimate of the remaining costs that will be required to complete aproject.     License revenue is recognized when all material services or conditions relating to the salehave been substantially performed and collectibility is assured. The Company defers revenue forlicense fees for which it is obligated to provide training and other services to its LicensedDealers.     *Accounts receivable.*The Company evaluates the allowance for doubtful accounts on a periodicbasis and reviews any significant customers with delinquent balances to determine futurecollectibility. The determination includes a review of legal issues (such as bankruptcy status),past payment history, current financial information and credit reports, and Company experience.Allowances are established in the period in which the account is deemed uncollectable or whencollection becomes uncertain.     *Inventories****.***The Company’s inventories are valued at the lower of cost or market. Reserves forobsolescence are estimated and based on projected sales volume. Though management considers thesebalances adequate and proper, changes in sales volumes due to unexpected economic conditions couldresult in materially different amounts for this item.     *Goodwill.*In accordance with SFAS No. 142, the Company tests goodwill for impairment on anannual basis or more frequently if an event occurs or circumstances change that could more likelythan not reduce the fair value of a reporting unit below its carrying amount. The Company estimatesfair value based upon the present value of future cash flows. In estimating the future cash flows,the Company takes into consideration the overall and
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industry economic conditions and trends,market risk of the Company and historical information.     Based on a critical assessment of its accounting policies and the underlying judgments anduncertainties affecting the application of those policies, management believes that the Company’sconsolidated financial statements provide a meaningful and fair perspective of the Company. Thisis not to suggest that other risk factors such as changes in economic conditions, changes inmaterial costs, and others could not adversely impact the Company’s consolidated financialposition, results of operations and cash flows in future periods.**New Accounting Standards**     On December 16, 2004, the FASB finalized SFAS No. 123R “Share-Based Payment,” which will beeffective for small business issuers for the fiscal years beginning after December 15, 2005 (fiscal2007). The new standard will require the Company to recognize share based payments, includinggrants of stock options, in the financial statements based upon their fair value. The Company willadopt the new standard using the modified-prospective method. The current pro forma disclosure ofthe impact on earnings using the Black-Scholes model is presented in the table in Note 2q.     In June 2006, the FASB issued Interpretation No 48. “Accounting for Uncertainty in IncomeTaxes an interpretation of FASB Statement No 109” (“FIN 48”). FIN 48 clarifies the recognitionthreshold and measurement principles for the financial statement recognition and measurement of atax position taken or expected to be taken in a tax return. FIN 48 also provides guidance onderecognition, classification, interest and penalties, accounting in interim periods, disclosureand transition. FIN 48 is effective for fiscal years beginning after December 15, 2006 (fiscalyear 2008). The Company is currently evaluating the provisions of FIN 48.**ITEM 7. FINANCIAL STATEMENTS**     This information appears in a separate section of this report following Part III.**ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE**     None.**ITEM 8A. CONTROLS AND PROCEDURES**
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     Based on their evaluation as of a date within 90 days of the filing date of this Annual Reporton Form 10-KSB, the Company’s principal executive officer and principal financial officer haveconcluded that the Company’s disclosure controls and proceduresas defined in Rules 13a-14(c) and 15d-14(c) under the Securities Exchange Act of 1934 (the ExchangeAct) are effective to ensure that information required to be disclosed by the Company in reportsthat it files or submits under the Exchange Act is recorded, processed, summarized and reportedwithin the time periods specified in Securities and Exchange Commission rules and forms.     There were no significant changes in the Company’s internal controls or in other factors thatcould significantly affect these controls subsequent to the date of their evaluation and up to thefiling date of this Annual Report on Form 10-KSB. There were no significant deficiencies ormaterial weaknesses, and therefore there were no corrective actions taken.     It should be noted that any system of controls, however well designed and operated, canprovide only reasonable, and not absolute, assurance that the objectives of the system are met. Inaddition, the design of any control system is based in part upon certain assumptions about thelikelihood of future events. Because of these and other inherent limitations of control systems,there can be no assurance that any design will succeed in achieving its stated goals under allpotential future conditions, regardless of how remote.**ITEM 8B. OTHER INFORMATION**     None.**PART III****ITEM 9.** **DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION16(a)**     The following table sets forth certain information regarding the current Directors andExecutive Officers of the Company as of November 30, 2006. Each director holds office fromelection until the next annual meeting of stockholders or until their successors are duly electedand qualified.
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           DIRECTORNAME PRINCIPAL OCCUPATION AND AGE SINCEMichael L. Boeckman Chief Financial Officer andAdministrative Partner of Cohen & Co.;age 59  1994        Morton A. Cohen Chairman, Chairman and Chief ExecutiveOfficer of Clarion Capital Corp.; age 71  1994        Dwight D. Goodman Director; age 73  1994        Richard L. Immerman President of BleachTech LLC; age 56  1998        Terrence R. Ozan Director of Capgemini; age 60  2006        Morris H. Wheeler President and Chief Executive Officer,Acting President of GCI; age 46  1996        Stuart C. McNeill President of CIPAR Inc.; age 43  N/A        Robert W. Pawlak Chief Financial Officer and Secretary;age 38  N/A      *Michael L. Boeckman*has been a Director of the Company since 1994. Mr. Boeckman has beenAdministrative Partner and Chief Financial Officer of Cohen & Co., a Northeast Ohio regional basedaccounting firm (no relation to Morton A. Cohen) for more than five years.     *Morton A. Cohen*has been a Director of the Company since 1994 and resumed as Chairman of theBoard in September 2006. From July 1994 until December 2001, Mr. Cohen had been the Chairman ofthe Board. He served as the Company’s Chief Executive Officer from 1994 to January 1998. Mr.Cohen has been Chairman of the Board of Directors and Chief Executive Officer of Clarion CapitalCorporation (“Clarion”), a private, small business investment company, for more than five years.Mr. Cohen is the father-in-law of Morris H. Wheeler.     *Dwight D. Goodman*has been a Director of the Company since 1994. Mr. Goodman was Chairman ofthe Board from January 2002 to August 2006. Mr. Goodman was Chief Executive Officer of the Companyfrom January 1998 to December 2001 and President of the Company from July 1996 to December 2001,and prior thereto commencing in 1984 held various executive offices with the Company and itssubsidiary GlasCraft Inc. (“GCI”).     *Richard L. Immerman*has been a Director of the Company since 1998. Mr. Immerman has beenPresident of BleachTech LLC, a manufacturer of sodium hypochlorite, since its inception in
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January 2002. Mr. Immerman is a partner of Chemical Ventures (marketer of magnesiumchloride), a position he has held for over five years.     *Terrence R. Ozan*has been a Director of the Company since March 2006. Mr. Ozan was a memberof the Global Management Committee, CEO of North American operations and the Managing Director ofworld wide consulting services of Capgemini from May 2000 until his retirement in June 2003. Priorthere to, Mr. Ozan held various executive positions at Ernst & Young including CEO of WorldwideConsulting and Director of US Manufacturing Services. Mr. Ozan currently serves on the Board ofDirectors of Capgemini.     *Morris H. Wheeler*has been a Director of the Company since 1996 and Chief Executive Officerand President since January 2002. In June 2004 Mr. Wheeler became Acting President of GCI. In1999, Mr. Wheeler founded Drummond Road LLC, an investment management company involved in themanagement of the venture capital portfolio of Clarion. Prior to founding Drummond Road, fromApril 1998 to June 1999, Mr. Wheeler was the founder and Chief Executive Officer of sputnik7.com(formerly BlueTape, LLC), an Internet media company, which won a Webby for Music Entertainment.Mr. Wheeler holds a degree in economics from the University of Massachusetts at Amherst and a J.D.from the Yale Law School. Mr. Wheeler is the son-in-law of Morton A. Cohen, the Company’s majorbeneficial shareholder.     *Stuart C. McNeill*has been an executive officer of the Company since March 2006 and has beenPresident of CIPAR Inc. since August 2005. Mr. McNeill was Chief Financial Officer of CuraFlo fromNovember 2003 until the acquisition in August 2005. Prior to joining CuraFlo Mr. McNeill wasfounder and President of McNeill & Associates, a venture capital firm, since its inception in 1990.     *Robert W. Pawlak*has been Vice President-Finance and Chief Financial Officer of the Companysince June 1998, Secretary of the Company since June 1997 and Controller of the Company sinceOctober 1996. Mr. Pawlak held various accounting positions for GCI since March 1994.     The audit committee consists of Michael L. Boeckman, Dwight D. Goodman, Chairman, and RichardL. Immerman. Michael L. Boeckman has been designated by the Board of Directors as the “AuditCommittee Financial Expert” under SEC rules and he also meets the NASD’s professional experiencerequirement.     Each non-employee director currently receives an annual retainer of $8,000, plus $750 andreimbursement for expenses for each meeting attended. Also, each non-employee director receives$1,500 and reimbursement for expenses for the Annual Stockholders
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and the Budget meetings attended. The Chairman of the Board receives an additional $10,000and the Chairman of both the Audit and Compensation Committees receive an additional $5,000 forservices performed at those positions.     The Company has a Code of Ethics for Executive Officers and All Senior Financial Officers.The Code has been filed as an Exhibit to this Form 10-KSB and has been posted on the Company’swebsite: www.cohesant.com**ITEM 10. EXECUTIVE COMPENSATION**     The following table sets forth information relating to the annual and long-term compensationfor the fiscal years ended November 30, 2006, 2005 and 2004 for the Chief Executive Officer, theother two most highly compensated executives of the Company, and another officer whose disclosurewould have been required but for the fact that he was not an executive officer at fiscal year-end.No other executive officer received compensation in excess of $100,000 during such years.**SUMMARYCOMPENSATION TABLE**                                                              **Long-Term**                    **Compensation Awards**                        **Securities**                    **Restricted** **Underlying**                **Other Annual** **Stock** **Options** **All other****Name and Principal** **Fiscal**     **Bonus** **Compensation** **Awards($)** **(shares)** **Compensation**          **Position** **Year** **Salary** **(1)** **(2)** **(3)** **(4)** **(5)**Morris H. Wheeler  2006  $201,000  $118,147  $0  $0   17,500  $7,584 President, Chief  2005   175,000   132,619   0   0   16,800   7,099 Executive Officer &  2004   153,010   91,869   0   70,125   0   6,510 Acting President ofGCI                                                         Stuart C. McNeill  2006   100,000   5,000   0   0   0   0 President – CIPAR