~~Table~~UNITED ofSTATES ~~Contents~~SECURITIES AND EXCHANGE COMMISSION

~~UNITED~~WASHINGTON, ~~STATES~~D.C. ~~SECURITIES AND EXCHANGE COMMISSION~~20549

~~WASHINGTON,~~FORM ~~D.C. 20549~~10-Q

~~FORM~~þ ~~10-Q~~ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

þFor ~~Quarterly~~the ~~report~~quarterly ~~pursuant~~period toended ~~Section~~April 1, 132008 or ~~15(d) of the Securities Exchange Act of 1934.~~

~~For~~o ~~the~~Transition ~~quarterly~~report ~~period~~pursuant ~~ended~~to ~~July 3,~~Section ~~2007~~13 or 15(d) of the Securities Exchange Act of 1934

oFor ~~Transition report pursuant to Section 13 or 15(d) of~~ the ~~Securities~~transition ~~Exchange~~period ~~Act of 1934~~from to

~~For~~Commission ~~the~~file ~~transition period from to~~ number: 001-31904

~~Commission~~CENTERPLATE, ~~file number: 001-31904~~INC.

~~CENTERPLATE,~~(Exact ~~INC.~~ name of registrant as specified in its charter)

(Exact name of registrant as specified in its charter)


Delaware		13-3870167

(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

2187 Atlantic Street, Stamford, Connecticut, 06902		(203) 975-5900

(Address of principal executive offices, including zip code)		(Registrant’s telephone number, including area code)

Delaware		13-3870167
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
2187 Atlantic Street, Stamford, Connecticut, 06902		(203) 975-5900
(Address of principal executive offices, including zip code)		(Registrant’s telephone number, including area code)

http:www.centerplate.com
(Registrant’s URL)

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

~~Indicate by check mark whether the registrant (1)~~þ ~~has~~Yes o filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. No

þ ~~Yes o~~Indicate Noby check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

~~Indicate~~Large ~~by check mark whether the registrant is a large~~ accelerated filer, ano ~~accelerated~~Accelerated filer ~~or a~~þ ~~non~~Non-accelerated filer o (~~see~~Do ~~definition~~not ofcheck ~~“accelerated~~if ~~filer”~~a ~~and~~smaller ~~“large~~reporting ~~accelerated~~company) ~~filer”~~Smaller ~~in Rule 12b-2~~reporting ofcompany ~~the Exchange Act).~~ o

~~o Large~~Indicate ~~accelerated~~by ~~filer þ~~check ~~Accelerated~~mark ~~filer o~~whether ~~Non~~the registrant is a shell company (as defined in Rule 12b-~~accelerated~~2 ~~filer~~of the Exchange Act).

~~Indicate~~o byYes þ ~~check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).~~ No

oAPPLICABLE ~~Yes þ~~ONLY NoTO CORPORATE ISSUERS:

~~APPLICABLE~~The ~~ONLY~~number TOof ~~CORPORATE~~shares ~~ISSUERS:~~of common stock of Centerplate, Inc. outstanding as of May [16 ] , 2008 was 20,981,813.

~~The number of shares of common stock of Centerplate~~CENTERPLATE, ~~Inc~~INC. ~~outstanding as of August 10, 2007 was~~ ~~22,524,992.~~

~~Table of Contents~~INDEX

CENTERPLATE, INC.


PART I - FINANCIAL INFORMATION			2

Item 1. Financial Statements (unaudited)			2

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			20

Item 3. Quantitative and Qualitative Disclosures About Market Risk			24

Item 4. Controls and Procedures			24

PART II - OTHER INFORMATION			25

Item 1. Legal Proceedings			25

Item 1A. Risk Factors			25

Item 6. Exhibits			25

~~INDEX~~- 1 -

PART I — FINANCIAL INFORMATION			2
Item 1. Financial Statements (unaudited)			2
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			21
Item 3. Quantitative and Qualitative Disclosures About Market Risk			26
Item 4. Controls and Procedures			27
PART II — OTHER INFORMATION			28
Item 1. Legal Proceedings			28
Item 1A. Risk Factors			28
Item 4. Submision of Matters to a Vote of Securities Holders			28
Item 6. Exhibits			29
EX-31.1: CERTIFICATION
EX-31.2: CERTIFICATION
EX-32.1: CERTIFICATION
EX-32.2: CERTIFICATION

PART I
FINANCIAL INFORMATION

-CENTERPLATE, 1INC. -AND SUBSIDIARIES

~~Table~~CONSOLIDATED ofCONDENSED ~~Contents~~BALANCE SHEETS (UNAUDITED) APRIL 1, 2008 AND JANUARY 1, 2008

PART I FINANCIAL INFORMATION


	April 1,			January 1,
ASSETS	2008			2008
	(In thousands, except share data)
CURRENT ASSETS:
Cash and cash equivalents	$	41,405		$	33,853
Restricted cash		1,143			1,146
Accounts receivable, less allowance for doubtful accounts of $1,077 and $993 at April 1, 2008 and January 1, 2008, respectively		28,018			29,539
Inventories		29,083			23,300
Prepaid expenses and other		4,720			3,475
Deferred tax assets		5,123			4,204


Total current assets		109,492			95,517


PROPERTY AND EQUIPMENT:
Leasehold improvements		41,930			41,968
Merchandising equipment		87,324			84,727
Vehicles and other equipment		18,656			18,116
Construction in process		2,565			1,895

Total		150,475			146,706

Less accumulated depreciation and amortization		(97,963	)		(94,720	)


Property and equipment, net		52,512			51,986


OTHER LONG-TERM ASSETS:
Contract rights, net		82,829			85,183
Restricted cash		10,386			10,307
Cost in excess of net assets acquired		41,142			41,142
Deferred financing costs, net		9,719			10,361
Trademarks		17,523			17,523
Deferred tax assets		23,213			15,867
Other		7,485			4,465


Total other long-term assets		192,297			184,848


TOTAL ASSETS	$	354,301		$	332,351

~~CENTERPLATE,~~See ~~INC.~~notes ~~AND~~to ~~SUBSIDIARIES~~consolidated condensed financial statements.

~~CONSOLIDATED~~- ~~CONDENSED BALANCE SHEETS (UNAUDITED) JULY 3, 2007 AND JANUARY~~ 2, ~~2007~~-

	July 3,			January 2,
	2007			2007
	(In thousands, except share data)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	34,413		$	39,591
Restricted cash		12,231			13,080
Accounts receivable, less allowance for doubtful accounts of $1,002 and $1,013 at July 3, 2007 and January 2, 2007, respectively		28,109			23,172
Merchandise inventories		24,868			19,347
Prepaid expenses and other		4,010			3,865
Deferred tax assets		4,802			3,139
Total current assets		108,433			102,194
PROPERTY AND EQUIPMENT:
Leasehold improvements		41,855			41,770
Merchandising equipment		78,461			71,043
Vehicles and other equipment		17,848			17,350
Construction in process		1,989			1,708
Total		140,153			131,871
Less accumulated depreciation and amortization		(87,513	)		(81,187	)
Property and equipment, net		52,640			50,684
OTHER LONG-TERM ASSETS:
Contract rights, net		78,479			79,209
Restricted cash		9,273			9,041
Cost in excess of net assets acquired		41,142			41,142
Deferred financing costs, net		11,646			12,930
Trademarks		17,523			17,523
Deferred tax assets		16,355			14,612
Other		4,846			5,035
Total other long-term assets		179,264			179,492
TOTAL ASSETS	$	340,337		$	332,370

CENTERPLATE, INC. AND SUBSIDIARIES

~~See~~CONSOLIDATED ~~notes~~CONDENSED toBALANCE ~~consolidated~~SHEETS ~~condensed~~(CONTINUED)(UNAUDITED) APRIL ~~financial~~1, ~~statements.~~2008 AND JANUARY 1, 2008

- 2 -


	April 1,			January 1,
	2008			2008
LIABILITIES AND STOCKHOLDERS’ DEFICIENCY	(In thousands, except share data)
CURRENT LIABILITIES:
Current portion of long-term debt	$	1,075		$	1,075
Short-term borrowings		57,000			29,500
Accounts payable		31,330			24,367
Accrued salaries and vacations		14,574			15,704
Liability for insurance		4,866			4,847
Accrued taxes, including income taxes		4,824			5,220
Accrued commissions and royalties		25,194			24,608
Liability for derivatives		923			311
Accrued interest		1,788			1,037
Accrued dividends		1,385			1,385
Advance deposits		4,825			3,436
Other		3,364			3,502


Total current liabilities		151,148			114,992


LONG-TERM LIABILITIES:
Long-term debt		222,796			223,334
Liability for insurance		10,645			9,370
Other liabilities		2,976			2,189


Total long-term liabilities		236,417			234,893


COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS’ DEFICIENCY:
Common stock, $0.01 par value - 100,000,000 shares authorized: 39,995,147 shares issued at April 1, 2008 and January 1, 2008; 20,981,813 shares outstanding at April 1, 2008 and January 1, 2008		400			400
Additional paid-in capital		218,331			218,331
Accumulated deficit		(132,712	)		(117,375	)
Accumulated other comprehensive income		1,657			2,050
Treasury stock - at cost (19,013,332 shares)		(120,940	)		(120,940	)


Total stockholders’ deficiency		(33,264	)		(17,534	)


TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIENCY	$	354,301		$	332,351

~~Table~~See ofnotes ~~Contents~~to consolidated condensed financial statements.

~~CENTERPLATE,~~- ~~INC.~~3 ~~AND SUBSIDIARIES~~-

~~CONSOLIDATED CONDENSED BALANCE SHEETS (CONTINUED)(UNAUDITED) JULY 3~~CENTERPLATE, ~~2007~~INC. AND ~~JANUARY 2, 2007~~SUBSIDIARIES

	July 3,			January 2,
	2007			2007
	(In thousands, except share data)
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIENCY)
CURRENT LIABILITIES:
Current portion of long-term debt	$	1,075		$	1,075
Short-term borrowings		12,500			15,000
Accounts payable		26,959			21,710
Accrued salaries and vacations		15,326			15,437
Liability for insurance		4,701			4,975
Accrued taxes, including income taxes		6,189			5,307
Accrued commissions and royalties		40,514			23,458
Liability for derivatives		1,369			1,251
Accrued interest		1,028			1,020
Accrued dividends		1,487			1,487
Advance deposits		6,601			3,662
Other		3,779			4,318
Total current liabilities		121,528			98,700
LONG-TERM LIABILITIES:
Long-term debt		209,251			209,789
Liability for insurance		8,195			7,744
Other liabilities		358			535
Total long-term liabilities		217,804			218,068
COMMITMENTS AND CONTINGENCIES
COMMON STOCK WITH CONVERSION OPTION, PAR VALUE $0.01, EXCHANGEABLE FOR SUBORDINATED DEBT, NET OF DISCOUNT		14,352			14,352
STOCKHOLDERS’ EQUITY (DEFICIENCY):
Common stock, $0.01 par value — authorized: 100,000,000 shares;
issued: 18,463,995 shares without conversion option; outstanding:
18,463,995 shares without conversion option		185			185
issued: 21,531,152 shares with conversion option; outstanding:
4,060,997 shares with conversion option		215			215
Additional paid-in capital		218,331			218,331
Accumulated deficit		(112,589	)		(97,282	)
Accumulated other comprehensive income		1,451			741
Treasury stock — at cost (17,470,153 shares)		(120,940	)		(120,940	)
Total stockholders’ equity (deficiency)		(13,347	)		1,250
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIENCY)	$	340,337		$	332,370

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)
THIRTEEN WEEK PERIODS ENDED APRIL 1, 2008 AND APRIL 3, 2007

See notes to consolidated condensed financial statements.


	Thirteen Weeks Ended
	April 1,			April 3,
	2008			2007
	(In thousands, except for share data)
Net sales	$	133,224		$	125,333

Cost of sales (excluding depreciation & amortization)		116,174			106,258
Selling, general, and administrative		19,209			17,200
Depreciation and amortization		8,286			7,382


Operating loss		(10,445	)		(5,507	)
Interest expense		9,395			8,052
Other income		(173	)		(502	)


Income before income taxes		(19,667	)		(13,057	)

Income tax benefit		(8,485	)		(5,009	)


Net loss	$	(11,182	)	$	(8,048	)


Basic and diluted net loss per share with and without conversion option	$	(0.53	)	$	(0.36	)


Weighted average shares outstanding with conversion option		—			4,060,997
Weighted average shares outstanding without conversion option		20,981,813			18,463,995

Total weighted average shares outstanding		20,981,813			22,524,992


Dividends declared per share	$	0.20		$	0.20

- 34 -

~~Table~~CENTERPLATE, ofINC. ~~Contents~~AND SUBSIDIARIES

~~CENTERPLATE~~CONSOLIDATED CONDENSED STATEMENTS OF STOCKHOLDERS’ DEFICIENCY AND COMPREHENSIVE LOSS (UNAUDITED) FOR THE PERIOD FROM JANUARY 1, ~~INC.~~2008 TO APRIL 1, 2008 AND ~~SUBSIDIARIES~~THE THIRTEEN WEEKS ENDED APRIL 1, 2008 AND APRIL 3, 2007

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED) THIRTEEN AND TWENTY-SIX WEEK PERIODS ENDED JULY 3, 2007 AND JULY 4, 2006


										Accumulated
					Additional					Other
	Common		Common		Paid-in		Accumulated			Comprehensive			Treasury
	Shares		Stock		Capital		Deficit			Income			Stock			Total
	(In thousands, except share data)
BALANCE, JANUARY 1, 2008		39,995,147	$	400	$	218,331	$	(117,375	)	$	2,050		$	(120,940	)	$	(17,534	)
Foreign currency translation		—		—		—		—			(393	)		—			(393	)
Dividends declared		—		—		—		(4,155	)		—			—			(4,155	)
Net loss		—		—		—		(11,182	)		—			—			(11,182	)


BALANCE, APRIL 1, 2008		39,995,147	$	400	$	218,331	$	(132,712	)	$	1,657		$	(120,940	)	$	(33,264	)

	Thirteen Weeks Ended						~~Twenty-six Weeks Ended~~
	July 3,			July 4,			July 3,			July 4,
	April 1,			April 3,
	2007			2006			2007			2006
	2008			2007
	(In thousands, except for share data)
Net loss	$	(11,182	)	$	(8,048	)
Net sales	$	200,839		$	190,699		$	326,172		$	304,204
Other comprehensive (loss) income - foreign currency translation adjustment		(393	)		74
Cost of sales (excluding depreciation & amortization)		162,948			154,174			269,206			249,834
Comprehensive loss	$	(11,575	)	$	(7,974	)
Selling, general, and administrative		20,161			17,413			37,361			32,096
Depreciation and amortization		7,713			7,074			15,095			14,125
Transaction related expenses		333			—			333			—
Contract related losses		—			—			—			100
Operating income		9,684			12,038			4,177			8,049
Interest expense		7,079			6,207			15,131			12,746
Other income		(542	)		(341	)		(1,044	)		(663	)
Income (loss) before income taxes		3,147			6,172			(9,910	)		(4,034	)
Income tax provision (benefit)		907			6,238			(4,102	)		1,630
Net income (loss)	$	2,240		$	(66	)	$	(5,808	)	$	(5,664	)
Basic and diluted net income (loss) per share with and without conversion option	$	0.10		$	(0.00	)	$	(0.26	)	$	(0.25	)
Weighted average shares outstanding with conversion option		4,060,997			4,060,997			4,060,997			4,060,997
Weighted average shares outstanding without conversion option		18,463,995			18,463,995			18,463,995			18,463,995
Total weighted average shares outstanding		22,524,992			22,524,992			22,524,992			22,524,992
Dividends declared per share	$	0.20		$	0.20		$	0.40		$	0.40

-See 4notes -to consolidated condensed financial statements.

~~Table~~- of5 ~~Contents~~-

CENTERPLATE, INC. AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF ~~STOCKHOLDERS’~~CASH ~~EQUITY~~FLOWS (~~DEFICIENCY) AND COMPREHENSIVE INCOME (LOSS) (~~UNAUDITED) ~~FOR THE PERIOD FROM JANUARY 2, 2007 TO JULY 3, 2007 AND THE~~ THIRTEEN ~~AND TWENTY-SIX~~ WEEKS ENDED ~~JULY~~APRIL 31, ~~2007~~2008 AND ~~JULY~~APRIL 43, ~~2006~~2007

	Common			Common			Common		Common
	Thirteen Weeks Ended
	Shares			Stock			Shares		Stock							Accumulated
	April 1,			April 3,
	without			without			with		with		Additional					Other
	2008			2007
	Conversion			Conversion			Conversion		Conversion		Paid-in		Accumulated			Comprehensive		Treasury
	(In thousands)
	Option			Option			Option		Option		Capital		Deficit			Income		Stock			Total
CASH FLOWS FROM OPERATING ACTIVITIES:
	(In thousands, except share data)
Net loss	$	(11,182	)	$	(8,048	)
BALANCE, JANUARY 2, 2007		18,463,995		$	185			21,531,152	$	215	$	218,331	$	(97,282	)	$	741	$	(120,940	)	$	1,250
Adjustments to reconcile net loss to net cash used in operating activities:
Foreign currency translation		—			—			—		—		—		—			710		—			710
Depreciation and amortization		8,286			7,382
Dividends declared		—			—			—		—		—		(8,920	)		—		—			(8,920	)
Amortization of deferred financing costs		642			642
FIN 48 transition amount		—			—			—		—		—		(579	)		—		—			(579	)
Interest earned on restricted cash		(79	)		(115	)
Net loss		—			—			—		—		—		(5,808	)		—		—			(5,808	)
Change in fair value of derivative		217			672
BALANCE, JULY 3, 2007		18,463,995		$	185			21,531,152	$	215	$	218,331	$	(112,589	)	$	1,451	$	(120,940	)	$	(13,347	)
Deferred tax benefit		(8,264	)		(4,734	)
Gain on disposition of assets		(1	)		—
(Increase) decrease in assets and liabilities:
Accounts receivable		1,521			302
Inventories		(5,783	)		(2,921	)
Prepaid expenses		(1,245	)		(1,650	)
Other assets		(1,166	)		(90	)
Accounts payable		12,569			(1,905	)
Accrued salaries and vacations		(1,130	)		(1,422	)
Liability for insurance		1,294			10
Accrued commissions and royalties		1,054			2,734
Other liabilities		1,826			(257	)
Non-cash effect of foreign currency translation on assets and liabilities		(47	)		74
Net cash used in operating activities		(1,488	)		(9,326	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of business		(1,000	)		—
Purchase of property and equipment		(3,424	)		(3,306	)
Proceeds from sale of property and equipment		26			2
Contract rights acquired		(2,796	)		(2,397	)
Decrease in restricted cash		3			458
Net cash used in investing activities		(7,191	)		(5,243	)

	Thirteen Weeks Ended					Twenty-six Weeks Ended
	July 3,		July 4,			July 3,			July 4,
	2007		2006			2007			2006
Net income (loss)	$	2,240	$	(66	)	$	(5,808	)	$	(5,664	)
Other comprehensive income - foreign currency translation adjustment		636		308			710			313
Comprehensive income (loss)	$	2,876	$	242		$	(5,098	)	$	(5,351	)

- 6 -

~~See~~CENTERPLATE, ~~notes~~INC. toAND ~~consolidated condensed financial statements.~~SUBSIDIARIES

-CONSOLIDATED 5CONDENSED -STATEMENTS OF CASH FLOWS (CONTINUED)(UNAUDITED) THIRTEEN WEEK PERIODS ENDED APRIL 1, 2008 AND APRIL 3, 2007


	Thirteen Weeks Ended
	April 1,			April 3,
	2008			2007
	(In thousands)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments - revolving loans	$	(7,500	)	$	(11,000	)
Borrowings - revolving loans		36,000			23,500
Swingline borrowings, net		(1,000	)		4,000
Principal payments on long-term debt		(538	)		(269	)
Dividend payments		(4,155	)		(4,460	)
Decrease in bank overdrafts		(6,243	)		(3,838	)


Net cash provided by financing activities		16,564			7,933


EFFECT OF FOREIGN CURRENCY TRANSLATION ON CASH		(333	)		—


INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS:		7,552			(6,636	)

CASH AND CASH EQUIVALENTS:
Beginning of period		33,853			39,591


End of period	$	41,405		$	32,955


SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid	$	7,390		$	6,627
Income taxes paid	$	419		$	335

SUPPLEMENTAL NON CASH FLOW INVESTING AND FINANCING ACTIVITIES:
Capital investment commitment accrued	$	2,741		$	2,490
Dividends declared and unpaid	$	1,384		$	1,487

~~CENTERPLATE,~~See ~~INC.~~notes ~~AND~~to ~~SUBSIDIARIES~~consolidated condensed financial statements.

~~CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED) TWENTY~~-~~SIX~~ ~~WEEKS~~7 ~~ENDED JULY 3, 2007 AND JULY 4, 2006~~-

	Twenty-six Weeks Ended
	July 3,			July 4,
	2007			2006
	(In thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(5,808	)	$	(5,664	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		15,095			14,125
Amortization of deferred financing costs		1,284			1,285
Charge for impaired assets		—			100
Non-cash interest earned on restricted cash		(232	)		(198	)
Change in fair value of derivative		118			(932	)
Deferred tax benefit		(3,985	)		1,515
Gain on disposition of assets		(26	)		(31	)
Other		710			313
(Increase)/decrease in assets and liabilities:
Accounts receivable		(4,884	)		(1,649	)
Merchandise inventories		(5,521	)		(3,682	)
Prepaid expenses		(145	)		(1,472	)
Other assets		(167	)		(1,735	)
Accounts payable		3,219			5,055
Accrued salaries and vacations		(111	)		3,444
Liability for insurance		177			(432	)
Accrued commissions and royalties		13,888			16,680
Other liabilities		3,113			4,366
Net cash provided by operating activities		16,725			31,088
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment		(8,110	)		(4,833	)
Proceeds from sale of property and equipment		17			165
Contract rights acquired		(4,043	)		(6,818	)
Restricted cash		849			—
Return on unamortized capital investment		—			1,828
Net cash used in investing activities		(11,287	)		(9,658	)

CENTERPLATE, INC. AND SUBSIDIARIES

~~See~~NOTES ~~notes~~TO toCONSOLIDATED ~~consolidated~~CONDENSED ~~condensed~~FINANCIAL ~~financial~~STATEMENTS ~~statements.~~(UNAUDITED) THIRTEEN WEEK PERIODS ENDED APRIL 1, 2008 AND APRIL 3, 2007

-1. ~~6 -~~GENERAL

~~Table~~ Centerplate, Inc. (“Centerplate” and together with its subsidiaries, the “Company”) is a holding company, the principal assets of ~~Contents~~which are the capital stock of its subsidiary, Volume Services America, Inc. (“Volume Services America”). Volume Services America is also a holding company, the principal assets of which are the capital stock of its subsidiaries, Volume Services, Inc. (“Volume Services”) and Service America Corporation (“Service America”).

~~CENTERPLATE~~ The accompanying financial statements of Centerplate have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission for interim financial reporting. Accordingly, ~~INC~~they do not include all of the information and footnotes required by generally accepted accounting principles for complete annual financial statements. ~~AND~~However, ~~SUBSIDIARIES~~such information reflects all adjustments (consisting solely of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of results for the interim periods.

~~CONSOLIDATED~~ The ~~CONDENSED~~results ~~STATEMENTS~~of OFoperations ~~CASH~~for ~~FLOWS~~the 13 week period ended April 1, 2008 are not necessarily ~~(CONTINUED)(UNAUDITED) TWENTY-SIX~~indicative ~~WEEK~~of ~~PERIODS~~the ~~ENDED~~results ~~JULY~~to 3be expected for the 52 week fiscal year ending December 30, ~~2007~~2008 ~~AND~~due to ~~JULY~~the 4seasonal aspects of the business. The accompanying consolidated condensed financial statements and notes thereto should be read in conjunction with the audited financial statements and notes thereto for the year ended January 1, ~~2006~~2008 included in the Company’s annual report on Form 10-K.

	Twenty-six Weeks Ended
	July 3,			July 4,
	2007			2006
	(In thousands)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments — revolving loans	$	(41,000	)	$	(5,000	)
Borrowings — revolving loans		38,500			5,000
Principal payments on long-term debt		(538	)		(538	)
Dividend payments		(8,920	)		(8,920	)
Increase in bank overdrafts		1,342			1,716
Net cash used in financing activities		(10,616	)		(7,742	)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS:		(5,178	)		13,688
CASH AND CASH EQUIVALENTS:
Beginning of period		39,591			41,410
End of period	$	34,413		$	55,098
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid	$	13,721		$	12,034
Income taxes paid	$	452		$	173
SUPPLEMENTAL NON CASH FLOW INVESTING AND FINANCING ACTIVITIES:
Capital investment commitment accrued	$	5,909		$	979
Dividends declared and unpaid	$	1,487		$	1,487

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

~~See~~ There ~~notes~~have tonot ~~consolidated~~been ~~condensed~~any ~~financial~~changes ~~statements~~in our significant accounting policies from those disclosed in the Company’s annual report for fiscal year 2007 on Form 10-K for the fiscal year ended January 1, 2008.

- Cost 7in -Excess of Net Assets Acquired and Trademarks – The Company performed its annual impairment tests of goodwill and trademarks as of April 1, 2008 in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 142, Goodwill and Other Intangible Assets, and determined that no impairment existed. There have been no events since April 1, 2008 that would cause the Company to have to reassess the carrying value of these assets.

~~Table~~ Insurance - The Company has a high deductible insurance program for general liability, auto liability, and workers’ compensation risk and self-insures its employee health plans. Management establishes a reserve for the high deductible and self-insurance liabilities considering a number of ~~Contents~~factors, including historical experience and an actuarial assessment of the liabilities for reported claims and claims incurred but not reported. The estimated liabilities for these programs, except for employee health insurance, are then discounted using rates of 1.99% and 3.34% at April 1, 2008 and January 1, 2008, respectively, to their present value based on expected loss payment patterns determined by experience. The total discounted high deductible liabilities recorded by the Company at April 1, 2008 and January 1, 2008 were $14,570,000 and $13,204,000, respectively. The related undiscounted amounts were $15,455,000 and $14,488,000, respectively.

~~CENTERPLATE,~~ The ~~INC~~employee health self-insurance liability is based on claims filed and estimates for claims incurred but not reported. ~~AND~~The ~~SUBSIDIARIES~~total liability recorded by the Company at April 1, 2008 and January 1, 2008 was $857,000 and $760,000, respectively.

~~NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (UNAUDITED) TWENTY~~-~~SIX~~ ~~WEEK~~8 ~~PERIODS ENDED JULY 3, 2007 AND JULY 4, 2006~~-

Accounting Treatment for IDSs, Common Stock Owned by Initial Equity Investors and Derivative Financial Instruments – The Company’s Income Deposit Securities (“IDSs”) include common stock and subordinated notes, the latter of which has three embedded derivative features. The embedded derivative features include a call option, a change of control put option, and a term-extending option on the notes. The call option allows the Company to repay the principal amount of the subordinated notes after the fifth anniversary of the issuance, provided that the Company also pays all of the interest that would have been paid during the initial 10-year term of the notes, discounted to the date of repayment at a risk-free rate. Under the change of control put option, the holders have the right to cause the Company to repay the subordinated notes at 101% of face value upon a change of control, as defined in the subordinated note agreement. The term-extending option allows the Company to unilaterally extend the term of the subordinated notes for two five-year periods at the end of the initial 10-year period provided that it is in compliance with the requirements of the indenture. The Company has accounted for these embedded derivatives in accordance with SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities, as amended and interpreted. Based on SFAS No. 133, as amended and interpreted, the call option and the change of control put option are required to be separately valued. As of April 1, 2008 and January 1, 2008, the fair value of these embedded derivatives was determined to be insignificant. ~~GENERAL~~The term extending option was determined to be inseparable from the underlying subordinated notes. Accordingly, it will not be separately accounted for in the current or future periods.

~~Centerplate~~ In December 2007, ~~Inc.~~the Company issued additional IDSs pursuant to the Amended Stockholders Agreement entered into by the Company on December 10, 2003 with those investors who held stock prior to the IPO (“~~Centerplate~~Initial Equity Investors”) ~~and~~in ~~together~~connection with ~~its~~the ~~subsidiaries,~~Company’s ~~the~~initial public offering (“~~Company~~IPO”). isThe common stock held by the Initial Equity Investors was initially treated as a ~~holding~~separate ~~company,~~class of common stock for presentation of earnings per share. Although the ~~principal~~common ~~assets~~stock held by the Initial Equity Investors is part of ~~which~~the ~~are~~same class of stock as the ~~capital~~common stock included in the IDSs for purposes of ~~its~~Delaware ~~subsidiary~~corporate law, ~~Volume~~the right to convert the shares into ~~Services~~IDSs ~~America,~~that ~~Inc.~~was ~~(“Volume~~granted ~~Services~~in ~~America”).~~the ~~Volume~~Company’s ~~Services~~Amended ~~America~~and isRestated ~~also~~Stockholders aAgreement ~~holding~~caused the stock ~~company,~~held by the ~~principal~~Initial ~~assets~~Equity Investors to have features of ~~which~~a ~~are~~separate ~~the~~class ~~capital~~of stock offor ~~its~~accounting purposes. ~~subsidiaries~~At April 3, ~~Volume Services~~2007, earnings per share for common stock with and without conversion rights ~~Inc~~were equal and therefore no separate presentation was required. ~~(“Volume~~As ~~Services”)~~of ~~and~~April 1, ~~Service~~2008 ~~America~~there ~~Corporation~~were ~~(“Service~~no shares ~~America”)~~of common stock with conversion options outstanding.

~~The~~ In ~~accompanying~~order ~~financial~~to ~~statements~~minimize ofour ~~Centerplate~~exposure ~~have~~to ~~been~~interest ~~prepared~~rate ~~pursuant~~risk, to the ~~rules and~~Company ~~regulations~~has ofan ~~the~~interest ~~Securities~~rate ~~and~~swap agreement ~~Exchange~~for ~~Commission~~a ~~for~~notional ~~interim~~amount ~~financial~~of ~~reporting~~$100 million. ~~Accordingly,~~ ~~they~~The doagreement ~~not~~is ~~include~~based ~~all~~on ofthree ~~the~~month ~~information~~LIBOR and contains ~~footnotes~~a ~~required~~collar byfeature ~~generally accepted~~with ~~accounting~~an ~~principles~~interest ~~for~~rate ~~complete~~floor ~~annual~~of ~~financial~~4.82% ~~statements~~and cap of 6%. ~~However,~~The ~~such~~Company ~~information~~has ~~reflects~~recorded ~~all~~a ~~adjustments~~liability ~~(consisting~~for ~~solely~~the fair value of ~~normal~~this ~~recurring~~derivative ~~adjustments)~~of ~~which~~approximately ~~are~~$.9 million at April 1, 2008 and $.3 million at January 1, 2008. Changes in the ~~opinion~~ market value of ~~management,~~this ~~necessary~~derivative ~~for~~are recognized ain ~~fair~~earnings ~~statement~~currently ofas ~~results~~a ~~for~~component ~~the~~of ~~interim~~interest ~~periods~~expense.

~~The~~ Income ~~results~~Taxes of– ~~operations~~The benefit for ~~the~~income ~~26 week~~taxes ~~period~~includes ~~ended July 3~~federal, ~~2007~~state ~~are~~and ~~not necessarily~~foreign ~~indicative~~taxes ofcurrently payable, and the ~~results~~change toin bedeferred ~~expected~~tax ~~for~~assets ~~the~~and ~~52 week~~liabilities. ~~fiscal~~Deferred ~~year~~tax assets ~~ending~~and ~~January 1,~~liabilities ~~2008~~are ~~due~~recognized to for the ~~seasonal~~expected ~~aspects~~future oftax ~~the~~consequences ~~business.~~of ~~The~~temporary differences ~~accompanying~~between ~~consolidated~~the ~~condensed~~carrying ~~financial~~amounts ~~statements~~ and ~~notes~~the ~~thereto~~tax ~~should~~basis beof ~~read~~assets inand ~~conjunction~~liabilities. ~~with~~A ~~the~~valuation allowance ~~audited~~is ~~financial~~established ~~statements~~for ~~and~~deferred ~~notes thereto~~tax ~~for~~assets ~~the~~when ~~year~~it ~~ended~~is ~~January 2,~~more ~~2007~~likely ~~included~~than innot that the ~~Company’s~~benefits of ~~annual~~such ~~report~~assets onwill ~~Form~~not ~~10-K~~be realized.

2 Income taxes for the 13 weeks ended April 1, 2008 and April 3, 2007 were calculated using the projected annual effective tax rate for fiscal 2008 and 2007, respectively, in accordance with SFAS No. 109 ~~SUMMARY~~Accounting OFfor ~~SIGNIFICANT~~Income ~~ACCOUNTING~~Taxes ~~POLICIES~~and APB No. 28 Interim Financial Reporting. Currently, the Company estimates that in the fiscal year ending December 30, 2008, it will have an effective annual tax rate of approximately 67%. In determining the effective annual tax rate, the Company’s book income, permanent tax adjustments, and tax credits have been factored into the calculation. In the previous year, the Company estimated that its effective annual tax rate for the fiscal year ended January 1, 2008 would be 40%. The fluctuation in the projected effective annual tax rate is primarily due to the sensitivity of the ratio involving expected ordinary income, permanent items (primarily the interest charge related to the

~~There have not been any changes in our significant accounting policies from those disclosed in the Company’s annual report for fiscal year 2006 on Form 10~~-K ~~for~~9 ~~the fiscal year ended January 2,~~- ~~2007, except for the adoption of FIN 48 described below.~~

~~Cost in Excess of Net Assets Acquired and Trademarks – The~~ Company ~~performed its annual~~’s ~~impairment~~derivatives, ~~tests of goodwill~~ and ~~trademarks~~federal astax ofcredits). ~~April 3,~~The ~~2007~~interim inincome ~~accordance~~tax ~~with~~provision ~~Statement of Financial Accounting Standards~~ (~~“SFAS”~~or benefit) ~~No. 142, Goodwill and Other Intangible Assets, and~~can ~~determined~~fluctuate ~~that~~considerably nofrom ~~impairment~~quarter ~~existed.~~to ~~There~~quarter ~~have~~as ~~been~~a noresult ~~events~~of ~~since~~changes ~~April 3,~~in ~~2007~~the ~~that~~projected ~~would~~effective ~~cause~~annual ~~the~~tax ~~Company to have to reassess the carrying value of these assets~~rate.

~~Insurance –~~ The Company has auncertain ~~high~~tax ~~deductible~~positions ~~insurance program for general liability, auto liability,~~ and ~~workers’~~in ~~compensation~~accordance ~~risk~~with ~~and~~FIN ~~self-insures~~48 ~~its~~– ~~employee~~Accounting ~~health plans. Management~~for ~~establishes~~Uncertainity ain ~~reserve~~Income ~~for~~Taxes ~~the~~an ~~high~~interpretation ~~deductible~~of ~~and~~the ~~self-insurance~~Statement ~~liabilities~~No. 109, ~~considering~~Accounting afor ~~number~~Income ~~of factors~~Taxes, ~~including~~has ~~historical~~recorded ~~experience~~a ~~and~~liability ~~an actuarial assessment~~ of ~~the~~approximately ~~liabilities~~$2.0 million ~~for reported claims~~ and ~~claims incurred but not reported~~$2.1 million ~~The estimated liabilities~~ for ~~these~~total ~~programs,~~gross ~~except~~unrecognized ~~for~~tax ~~employee~~benefits ~~health~~as ~~insurance, are then discounted using rates~~ of ~~5.0% and 4.75% at July~~April 31, ~~2007~~ 2008 and January 21, ~~2007~~2008, respectively,. toOf ~~their~~this ~~present value based on expected loss payment~~total, ~~patterns~~approximately ~~determined~~$.8 byand ~~experience~~$1.0 million ~~The~~(net ~~total~~of ~~discounted~~federal ~~high~~benefit ~~deductible~~on ~~liabilities~~state ~~recorded~~issues) byas ~~the Company~~of ~~at July~~April 31, ~~2007~~2008 and January 21, ~~2007~~2008, ~~were $11~~respectively,~~695,000~~ ~~and~~represent ~~$11,100,000,~~the ~~respectively.~~amount ~~The related~~of ~~undiscounted~~unrecognized ~~amounts~~tax ~~were~~benefits ~~$13,503,000~~that are permanent in nature and, ~~$12~~if recognized,~~718,000,~~ ~~respectively~~would affect the annual effective tax rate.

The ~~employee~~Company ~~health~~has ~~self-insurance~~accounted ~~liability~~for isthe ~~based~~issuance onof ~~claims~~IDS ~~filed~~units in December 2003 and ~~estimates~~December 2007 ~~for~~as representing ~~claims~~shares of common stock and subordinated notes by allocating the proceeds from each IDS ~~incurred~~unit ~~but~~to ~~not~~the ~~reported~~underlying stock or subordinated note based upon the relative fair values of each. Accordingly, ~~The~~the ~~total~~portion ~~liability~~of ~~recorded~~the aggregate IDS units outstanding that represents subordinated notes has been accounted for by the Company atas ~~July 3,~~long-term ~~2007~~debt ~~and~~bearing ~~January~~a stated interest rate of 13.5% and 2maturing on December 10, ~~2007~~2013. ~~was~~During ~~$986,000~~the ~~and~~13 weeks $ended April 1,~~432~~ 2008,~~000,~~ ~~respectively~~the Company deducted interest expense of approximately $4.0 million on the subordinated notes for purposes of computing taxable income for U.S. federal and state income tax purposes.

- The 8determination -as to whether an instrument is treated as debt or equity for income tax purposes is based on the facts and circumstances. There is no clear statutory definition of debt and its characterization is governed by principles developed in case law, which analyzes numerous factors that are intended to identify the economic substance of the investor’s interest in the corporation. The Company believes that the subordinated notes issued in 2003 and 2007 should be treated as debt for U.S. federal income tax purposes. However, no ruling on this issue has been requested from any federal or state tax authority, and there is no authority that directly addresses the tax treatment of securities with terms substantially similar to the subordinated notes or offered as a unit consisting of subordinated notes and common stock. In light of this absence of direct authority, there can be no assurance that the subordinated notes will be treated as debt for income tax purposes. If the subordinated notes were treated as equity rather than as debt for income tax purposes, the stated interest on the subordinated notes would be treated as a distribution with respect to stock and would not be deductible for income tax purposes.

~~Table~~ Additionally, there can be no assurance that a taxing authority will not challenge the determination that the interest rate on the subordinated notes represents an arm’s length rate. If such a challenge were successful, any excess amount over arm’s length would not be deductible and could be recharacterized as a dividend payment instead of ~~Contents~~an interest payment for income tax purposes.

~~Accounting~~ Since ~~Treatment~~issuance ~~for~~of ~~IDSs,~~the ~~Common~~IDS ~~Stock~~units ~~Owned~~in byDecember 2003 ~~Initial Equity Investors~~ and ~~Derivative Financial~~2007, ~~Instruments~~the —cumulative ~~The~~amount ~~Company’s~~of ~~Income~~interest ~~Deposit~~expense ~~Securities~~associated ~~(“IDSs”)~~with ~~include~~the ~~common stock and subordinated~~ notes, ~~the latter of which~~ has ~~three~~been ~~embedded~~approximately ~~derivative~~$62 million ~~features.~~and ~~The~~the ~~embedded~~additional ~~derivative~~tax ~~features~~due ~~include a call~~to ~~option,~~the afederal ~~change~~and ofstate ~~control put option~~authorities, ~~and~~would abe ~~term-extending~~approximately ~~option on the notes~~$7.2 million ~~The~~based ~~call~~on ~~option allows~~ the Company’s ability to ~~repay~~utilize ~~the~~net ~~principal~~operating ~~amount~~losses ofand ~~the~~tax ~~subordinated~~credits ~~notes~~to ~~after~~offset ~~the~~a ~~fifth anniversary~~portion of the ~~issuance,~~tax ~~provided that the Company also pays all of the interest that would~~liability, ~~have~~if ~~been paid during~~ the ~~initial~~subordinated ~~10-year term of the~~ notes, ~~discounted~~were to ~~the~~be ~~date~~treated ofas ~~repayment~~equity ~~at a~~for ~~risk-free~~income ~~rate.~~tax ~~Under~~purposes ~~the~~since ~~change~~inception. Such ofreclassification, ~~control put option~~however, ~~the~~would ~~holders~~also ~~have the right to~~ cause the Company to ~~repay~~utilize ~~the~~more ~~subordinated notes at 101%~~ of ~~face~~its ~~value~~deferred ~~upon~~tax assets at a ~~change~~faster ofrate ~~control,~~than asit ~~defined in~~otherwise ~~the subordinated note agreement~~would. The ~~term-extending option allows the~~ Company tobelieves ~~unilaterally extend~~ the ~~term~~interest ofon the subordinated notes ~~for~~should ~~two~~be ~~five-year~~deductible ~~periods at the end of the initial 10-year period provided that it is in compliance with the requirements of the indenture. The Company has accounted~~ for ~~these~~federal ~~embedded derivatives in accordance with SFAS No. 133, Accounting for Derivative Instruments~~ and ~~Hedging~~state ~~Activities,~~income astaxes ~~amended~~ and ~~interpreted. Based on SFAS No. 133~~, as ~~amended and interpreted~~such, ~~the~~has ~~call option and the change of control put option are required~~not torecorded bea ~~separately~~liability ~~valued.~~for ~~As of July 3, 2007 and January 2, 2007,~~ the ~~fair~~potential ~~value~~disallowance of ~~these~~this ~~embedded derivatives was determined to be insignificant~~deduction. ~~The term extending option was determined to be~~ ~~inseparable from the underlying subordinated notes. Accordingly, it will not be separately accounted for in the current or future periods.~~

In The ~~connection~~Company ~~with~~is ~~the~~subject ~~Initial Public Offering (“IPO”) in December 2003, those investors who held stock prior~~ to the IPO (the “Initial Equity Investors”) entered into the Amended Stockholders Agreement on December 10, 2003 with the Company, which provides that, upon any post-offering sale of common stock by the Initial Equity Investors, at the option of the Initial Equity Investors, the Company will exchange a portion of its common stock for subordinated notes at an exchange rate of $9U.30S ~~principal~~and ~~amount~~Canadian ofincome ~~subordinated notes for each share of common stock (so that~~taxes, ~~after~~as ~~such exchange,~~well ~~the~~as ~~Initial~~various ~~Equity~~other ~~Investors~~state ~~will have shares of common stock~~ and ~~subordinated notes in~~ ~~the~~local ~~appropriate proportions to represent integral numbers of IDSs)~~jurisdictions. InWith ~~order~~few ~~to determine the number of shares of common stock that the Initial Equity Investors could convert into subordinated debt~~exceptions, the Company ~~divided~~is ~~the~~no ~~exchange~~longer ~~rate~~subject ofto $9U.30S. byfederal, ~~the original issue price of the IDSs of~~state ~~$15.00~~and ~~at December 4~~local, ~~2003~~or ~~(the quotient equals 0~~non-U.~~62)~~S. ~~This~~income ~~quotient~~tax ~~was~~examinations ~~then multiplied~~ by ~~the total~~tax ~~number~~authorities offor ~~shares~~years ~~owned~~before ~~by the Initial Equity Investors (4~~2003,~~060,997~~ ~~shares) to determine the~~although ~~number~~carryforward ofattributes ~~IDSs~~ that ~~the~~were ~~Initial~~generated ~~Equity~~prior ~~Investors~~to ~~would~~2004 ~~own~~may ~~after~~still ~~conversion~~be ~~(2,517,817~~adjusted ~~IDSs,~~upon ~~each comprised~~examination ~~of one share of stock and a subordinated note). The number of shares owned~~ by ~~the Initial~~ ~~Equity Investors before conversion (4,060,997) was subtracted from~~ the ~~number~~IRS ofif ~~shares~~ they ~~would own~~either ~~after~~have ~~conversion~~been ~~(2,517,817)~~or towill ~~determine the number of shares of common stock to~~ be ~~converted into~~used ~~subordinated debt (1,543,180 shares) at the exchange rate of $9.30 per share resulting~~ in ~~approximately~~ ~~$14.4 million~~a ~~described~~future ~~further below~~period.

~~The~~- ~~Company~~10 ~~has concluded that the portion of the Initial Equity Investor’s common stock~~- exchangeable for subordinated debt as calculated above should be classified on its consolidated balance sheet according to the guidance provided by Accounting Series Release No. 268 (FRR Section 211), “Redeemable Preferred Stocks”. Accordingly, at both July 3, 2007 and January 2, 2007, the Company has recorded approximately $14.4 million as “Common stock with conversion option exchangeable for subordinated debt” on the balance sheet. In addition, the Company has determined that the option conveyed to the Initial Equity Investors to exchange common stock for subordinated debt in order to form IDSs is an embedded derivative in accordance with Paragraph 12 of SFAS No. 133. The Company has recorded a liability for the fair value of this embedded derivative of approximately $1.5 million as of July 3, 2007, an increase of $0.1 million from January 2, 2007. This option will continue to be recorded at fair value each reporting period with the change in the fair value recorded in interest expense in the accompanying consolidated statements of operations until such option is exercised.

~~Upon any~~ The ~~actual~~Company’s ~~exchange~~continuing ofpractice ~~common~~is ~~stock~~to ~~for~~recognize ~~subordinated~~interest ~~debt, the carrying value of “Common stock with conversion option exchangeable for subordinated debt”~~ and ~~the~~penalties ~~fair~~related ~~value~~to ofincome ~~the~~tax ~~derivative~~matters ~~associated~~in ~~with~~income ~~the~~tax ~~exchange right will be eliminated and the newly issued senior subordinated notes will be recorded at fair value~~expense. ~~Upon conversion,~~During ~~interest on~~ the ~~subordinated notes will be payable at~~ 13~~.5%~~ weeks ~~per~~ended ~~annum~~April 1, ~~resulting~~2008, inthe ~~additional~~Company ~~interest~~had ~~expense of~~recorded approximately $1216,~~937,500~~000 ~~annually.~~for ~~Any~~interest ~~difference between the fair value of the subordinated notes~~ and their par value at issuance will be recorded as premium or discount and amortized as an adjustment to interest expense in our consolidated statements of operations through maturity of the subordinated notespenalties.

The ~~common~~Company ~~stock~~does ~~held~~not byexpect that the ~~Initial~~total ~~Equity~~amounts ~~Investors was initially treated as a separate class~~ of ~~common~~unrecognized ~~stock~~tax ~~for~~benefits ~~presentation of earnings per share. Although the common stock held by~~will ~~the~~significantly ~~Initial~~increase ~~Equity~~or ~~Investors~~decrease iswithin ~~part of~~ the ~~same~~next ~~class of stock as the common stock included in the~~12 months. ~~IDSs for purposes~~

New Accounting Standards – We adopted the provisions of SFAS No. 157, Fair Value Measurements (FAS 157) on January 2, 2008 as amended to defer the effective date for certain nonfinancial assets and liabilities to years beginning after November 15, 2008. FAS 157 defines fair value, establishes a market-based framework or hierarchy for measuring fair value, and expands disclosures about fair value measurements. FAS 157 is applicable whenever another accounting pronouncement requires or permits assets and liabilities to be measured at fair value. FAS 157 does not expand or require any new fair value measures, however the application of this statement may change current practice. In February 2008, the FASB decided that an entity need not apply this standard to nonfinancial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a nonrecurring basis until 2009. Accordingly, our adoption of this standard in 2008 is limited to financial assets and liabilities, which primarily affects the valuation of our interest rate swap agreement. We utilize the market approach to measure the fair market value. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. The Company has recorded a liability for the fair value of this derivative of $.9 million -at April 1, 2008. We are still in the process of evaluating this standard with respect to its effect on nonfinancial assets and liabilities and therefore have not yet determined the impact that it will have on our financial statements upon full adoption in 2009.

~~Table~~ We adopted SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities - Including an Amendment of ~~Contents~~FASB Statement No. 115 (FAS 159) on January 2, 2008. FAS 159 permits entities to choose to measure many financial instruments and certain other items at fair value. Entities that elect the fair value option will report unrealized gains and losses in earnings at each subsequent reporting date. The fair value option may be elected on an instrument-by-instrument basis, with few exceptions. FAS 159 also establishes presentation and disclosure requirements to facilitate comparisons between companies that choose different measurement attributes for similar assets and liabilities. The adoption of FAS 159 did not have an effect on our financial condition or results of operations as we did not elect this fair value option, nor is it expected to have a material impact on future periods as the election of this option for our financial instruments is expected to be limited.

~~of Delaware~~ In ~~corporate law~~December 2007, the ~~right~~FASB toissued ~~convert~~SFAS ~~that~~No. 141R, isBusiness ~~granted~~Combinations, inwhich ~~the~~will ~~Company’s~~significantly ~~Amended and~~change ~~Restated Stockholders Agreement as described above causes~~ the ~~stock~~accounting ~~held by the Initial Equity Investors to have features of a separate class of stock~~ for ~~accounting~~business ~~purposes~~combinations. AtSFAS ~~July~~No. 3,141R ~~2007~~is ~~and~~effective ~~July 4,~~for ~~2006,~~the ~~earnings~~Company ~~per share~~ for ~~common~~business ~~stock~~combinations ~~with~~beginning ~~and~~in ~~without~~fiscal ~~conversion~~2009. ~~rights~~The ~~were~~Company ~~equal~~is ~~and~~currently ~~therefore no~~evaluating ~~separate~~this ~~presentation was required~~statement.

~~Income Taxes – The provision (benefit) for income taxes includes federal, state and foreign taxes currently payable, and the change in deferred tax assets and liabilities~~3. ~~Deferred~~COMMITMENTS ~~tax assets~~AND ~~and liabilities are recognized for the expected future tax consequences of temporary~~CONTINGENCIES differences between the carrying amounts and the tax basis of assets and liabilities. A valuation allowance is established for deferred tax assets when it is more likely than not that the benefits of such assets will not be realized.

~~Income~~ There ~~taxes~~are ~~for~~various ~~the~~claims ~~26 weeks~~and ~~ended~~pending ~~July 3,~~legal ~~2007~~actions ~~and~~against ~~July 4,~~or ~~2006~~directly ~~were~~involving ~~calculated using the~~Centerplate ~~projected~~that ~~annual~~are ~~effective~~incidental ~~tax~~to ~~rate~~the ~~for~~conduct ~~fiscal~~of ~~2007~~its ~~and 2006, respectively, in accordance with SFAS No~~business. ~~109~~ ~~“Accounting~~It ~~for~~is ~~Income~~the ~~Taxes”~~opinion ~~and~~of ~~APB No. 28 Interim Financial Reporting. Currently~~management, ~~the~~after ~~Company~~considering ~~estimates~~a ~~that~~number inof ~~the fiscal year ending January 1~~factors, ~~2008,~~including itbut ~~will~~not ~~have~~limited anto ~~effective~~the ~~annual tax~~current ~~rate~~status of ~~approximately~~any ~~-43%.~~pending proceeding In(including ~~determining~~any ~~the~~settlement ~~effective annual tax rate~~discussions), the ~~Company’s~~views ~~book income,~~of ~~permanent~~retained ~~tax adjustments~~counsel, ~~and tax credits have been factored into~~ the ~~calculation.~~nature Inof the litigation, prior ~~year~~experience ~~period,~~and the ~~Company~~amounts ~~estimated~~ that ~~its~~have ~~effective~~been ~~annual~~accrued ~~tax rate~~ for ~~the~~known ~~fiscal year ended January 2~~contingencies, ~~2007 would be -40%. The fluctuation in~~ that the ~~projected~~ultimate ~~effective~~disposition ~~annual~~of ~~tax~~any ~~rate is primarily due to the sensitivity~~ of ~~the~~these ~~ratio~~pending ~~involving~~proceedings ~~expected~~or ~~ordinary~~contingencies ~~income~~will ~~and~~not ~~permanent items,~~have ~~primarily the non-cash interest charge related to the Company’s derivatives which is~~ a ~~permanent~~material ~~adjustment~~adverse ~~(as~~effect iton ~~increases~~our ~~the~~financial ~~effective~~condition ~~tax rate decreases). The interim income tax provision (~~or ~~benefit)~~results ~~can fluctuate considerably from quarter to quarter as a result~~ of ~~changes in the projected effective annual tax rate~~operations. ~~For the 26 weeks ended July 3, 2007, the projected~~ effective annual tax rate of -43% was not utilized to record the Company’s tax benefit for the periods, due to the limitation applicable pursuant to the guidance provided by FIN 18, Accounting for Income Taxes In Interim Periods (an interpretation of APB No. 28).

In- ~~July 2006,~~11 ~~the Financial Accounting Standards Board (“FASB”) issued Interpretation No. 48,~~- Accounting for Uncertainty in Income Taxes (“FIN 48”), an interpretation of the Statement No. 109, Accounting for Income Taxes. FIN 48 requires that a position taken or expected to be taken in a tax return be recognized in the financial statements when it is more likely than not (i.e. a likelihood of more than fifty percent) that the position would be sustained upon examination by tax authorities. A recognized tax position is then measured at the largest amount of benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. FIN 48 also requires expanded disclosures including identification of tax positions for which it is reasonably possible that total amounts of unrecognized tax benefits will significantly change in the next twelve months, a description of tax years that remain subject to examination by major tax jurisdiction, a tabular reconciliation of the total amount of unrecognized tax benefits at the beginning and end of each annual reporting period, the total amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate and the total amounts of interest and penalties recognized in the statements of operations and financial position. FIN 48 was effective for public companies for fiscal years beginning after December 15, 2006.

~~The Company adopted the provisions of FIN 48 on January 3, 2007~~4. ~~As a result of the~~DEBT implementation of FIN 48, the Company recognized approximately a $579,000 increase in the liability for unrecognized tax benefits, which was accounted for as a reduction to the January 3, 2007, balance of retained earnings. As of January 3, 2007, the Company had approximately $2.1 million of total gross unrecognized tax benefits. Of this total, approximately $1.0 million (net of the federal benefit on state issues) represents the amount of unrecognized tax benefits that, if recognized, would affect the annual effective tax rate. There have been no significant changes to these amounts during the quarter ended July 3, 2007. The Company does not expect that the total amounts of unrecognized tax benefits will significantly increase or decrease within the next 12 months.

~~The~~ Credit Agreement – On April 1, 2005, the Company ~~accounted~~entered ~~for~~into ~~its~~a ~~issuance~~credit agreement pursuant to which General Electric Capital Corporation (“GE Capital”) agreed to provide up to $215 million of senior ~~IDS~~secured ~~units~~financing. The financing was comprised of a term loan in ~~December~~the initial amount of $107.5 million and revolving credit facility also in the initial amount of $107.5 million (the “Credit Agreement”). The Credit Agreement bears interest at a floating rate equal to a margin over a defined prime rate (initially 1.25% for the term loan and 1.5% for the revolving credit facility) or a percentage over a Eurodollar rate (initially 3.25% for the term loan and 3.5% for the revolving credit facility). The applicable margins for the revolving credit facility are subject to adjustment (initially from 1.0% to 1.75% for loans based on a defined prime rate and from 3.0% to 3.75% for Eurodollar loans) based on our total leverage ratio. The applicable margins were increased in connection with the April and May 2008 amendments as described below. The proceeds of the term loan were used to repay the prior $65 ~~2003~~million byterm ~~allocating~~loan, outstanding revolving loans of $23.25 million, as well as interest, related fees and expenses, including a prepayment premium of approximately $4.6 million on the term loan facility. The revolving portion of the Credit Agreement has a $35 million letter of credit sub-limit and a $10 million swing line loan sub-limit. At April 1, 2008, approximately $22,758,000 of letters of credit were outstanding but undrawn and the Company had $57,000,000 in short-term revolving loans outstanding.

The term loan matures in October 2010 and requires quarterly principal payments of $269,000. The availability of funding under the revolving credit facility depends on the satisfaction of various financial and other conditions, including restrictions in the indenture governing the subordinated notes. The revolving credit facility matures in April 2010 and is subject to an annual thirty-day 10pay down requirement, exclusive of letters of credit and certain specified levels of permitted acquisition and service contract-related revolving credit advances. Borrowings under the Credit Agreement are secured by substantially all of the Company’s assets and rank senior to the subordinated notes. The Credit Agreement contains customary events of default.

~~Table~~ The ofagreements ~~Contents~~governing the Company’s indebtedness impose significant operating and financial restrictions on the Company. These restrictions prohibit or limit, among other things,

~~proceeds for~~• ~~each IDS unit to~~ the ~~underlying~~incurrence ~~stock and subordinated notes based upon the relative fair values~~ of ~~each~~additional atindebtedness ~~that~~• ~~time. Accordingly,~~ the ~~portion~~issuance of ~~the~~preferred ~~aggregate~~stock ~~IDSs~~and ~~outstanding~~certain ~~that represents~~redeemable ~~subordinated~~common ~~notes~~stock; ~~has~~• ~~been accounted for by~~ the ~~Company~~payment ~~as long-term debt bearing a stated interest rate~~ of ~~13.5%~~dividends; ~~maturing~~• ~~on December 10, 2013. During~~ the ~~26 weeks~~purchase ended July 3, 2007, the Company deducted interest expense of approximately $7.1 million on the subordinated notes from taxable income for U.S. federal and state income tax purposes. Although to date, the Company has not been notified that the notes should be treated as equity rather than debt for U.S. federal and state income tax purposes, there can be no assurances that the Internal Revenue Service or ~~the courts~~redemption ~~will not seek to challenge the treatment~~ of ~~these notes as debt or~~ the amount of interest expense deducted. If the notes were to be treated as equity for income tax purposes, interest expense associated with the notes would not be deductible from taxable income. There would be no additional tax due to the federal and state authorities for the 26 week period ending July 3, 2007 as a result of the Company’s ~~second~~outstanding ~~quarter~~common ~~results.~~stock; ~~Since~~• ~~issuance~~specified ofsales ~~the IDS units in December 2003, the cumulative amount~~ of interest expense associated with the notes is approximately $50.7 million and the additional tax due to the federal and state authorities, would be approximately $6.0 million based on the Company’s ability to utilize net operating losses and tax credits to offset a portion of the tax liability. The Company believes the interest on the subordinated notes should be deductible for federal and state income taxes and, as such, has not recorded a liability for the potential disallowance of this deduction. assets

The ~~Company~~terms isof ~~subject~~the toCredit ~~U.S~~Agreement ~~and~~include ~~Canadian~~other, ~~income~~more ~~taxes~~restrictive, ascovenants ~~well~~and asprohibit ~~various other state and~~the ~~local~~Company ~~jurisdictions.~~from ~~With~~prepaying ~~few~~other ~~exceptions~~indebtedness, including the ~~Company~~subordinated isnotes, nowhile ~~longer~~indebtedness under ~~subject~~the toCredit ~~U.S.~~Agreement ~~federal,~~is ~~state and local, or non-U~~outstanding.S. ~~income~~The ~~tax~~Credit ~~examinations~~Agreement byalso ~~tax~~requires ~~authorities~~the ~~for~~Company ~~years before 2003, although~~to ~~carryforward~~maintain ~~attributes~~specified ~~that~~financial ~~were~~ratios ~~generated~~and ~~prior~~satisfy tocertain ~~2003~~financial ~~may~~condition ~~still~~tests, beincluding ~~adjusted upon examination by~~a ~~the~~maximum ~~IRS~~net ifleverage ~~they~~ratio, ~~either~~a ~~have~~minimum ~~been~~interest orcoverage ~~will~~ratio beand ~~used~~a inmaximum anet ~~future~~senior ~~period~~leverage ratio.

~~The~~- ~~Company’s~~12 ~~continuing practice is to recognize interest and penalties related to income tax~~- ~~matters in income tax expense. As of January 3, 2007, the Company had approximately $226,000 accrued for interest and penalties.~~

~~New~~ The ~~Accounting~~Credit ~~Standards~~Agreement —also Incontains ~~September 2006,~~significant restrictions on the ~~FASB~~Company’s ~~issued~~ability ~~SFAS~~to Nopay interest on the subordinated notes and dividends on shares of the Company’s common stock. ~~157~~ ~~(“SFAS~~These restrictions are ~~157”)~~based, ~~Fair~~among ~~Value~~other things, on the ability to meet separate but more rigorous financial ~~Measurements~~tests as those described in this item. InThe ~~addition~~ability to ~~defining~~meet ~~fair~~these ~~value,~~financial ~~SFAS~~tests ~~157~~could ~~provides~~be aaffected by ~~framework~~the ~~for~~loss of significant contracts, the ~~measurement of~~failure ~~fair~~to ~~value~~generate ~~and~~new ~~expands~~business, ~~disclosure~~unexpected ~~requirements~~liabilities, increased ~~about~~expenses, ~~fair~~increased ~~value~~interest ~~measurements.~~costs ~~SFAS~~due ~~No. 157~~to ~~will~~additional revolver borrowings or higher beinterest ~~effective~~rates ~~for~~on ~~fiscal~~the ~~years~~credit ~~beginning~~facility, ~~after~~general ~~November 15~~economic conditions, ~~2007~~or other events affecting the Company’s operations. ~~The~~In the event the Company ~~has~~is ~~yet~~unable to ~~evaluate~~satisfy the required ratios for any monthly test in the ~~impact~~future, the Company would be required to suspend the payment of ~~SFAS~~dividends ~~No. 157~~and possibly defer current installments of interest on ~~its~~the ~~financial~~subordinated ~~statements~~notes absent obtaining a waiver from the senior lenders.

In ~~February~~March and April ~~2007~~2008, the ~~FASB~~Company ~~issued~~obtained ~~No. SFAS~~waivers ~~159~~and ~~(“SFAS~~amendments ~~159”),~~of ~~Fair~~certain ~~Value~~provisions ~~Option for Financial~~of ~~Assets~~the ~~and~~Credit ~~Financial~~Agreement ~~Liabilities~~temporarily ~~Including~~affecting anthe ~~amendment~~calculation of ~~FASB~~the financial ~~Statement~~ratios Nothat must be achieved in order to pay dividends. ~~115~~ ~~(“SFAS~~Among ~~159”)~~other things, the waivers and amendments adjusted the senior ~~which~~leverage ~~permits~~ratio, ~~entities~~total toleverage ~~choose~~ratio and interest coverage ratio requirements for the first quarter 2008 to ~~measure~~levels ~~many~~that ~~financial~~permitted ~~instruments~~the ~~and~~Company ~~certain~~to ~~other~~pay ~~items~~dividends and atinterest on the ~~fair~~subordinated ~~value~~notes through May 2008. ~~The~~In ~~provisions~~addition, ofthe April 2008 ~~SFAS~~amendment ~~159~~allowed ~~will~~the beCompany ~~effective~~to invest ~~for~~in ~~fiscal~~a ~~years~~potential ~~beginning~~new ~~after~~service ~~November~~contract and increased the amount ~~15,~~of ~~2007~~capital expenditures the Company can make in fiscal 2008. The ~~Company~~amendment ~~has~~also ~~yet~~adjusted tothe ~~evaluate~~interest rate on the ~~impact~~term loan portion of ~~SFAS~~the credit Nofacility to 1. ~~159~~75% onover ~~its~~a ~~financial~~defined ~~statements~~prime rate, or 3.75% over a Eurodollar rate.

3 On May 19, 2008, the Company obtained an additional amendment to the Credit Agreement that adjusted the senior leverage ratio, total leverage ratio and interest coverage ratio to levels that are expected to permit the Company to pay interest on the subordinated notes on a monthly basis through October 2008. ~~COMMITMENTS~~Thereafter, ~~AND~~the ~~CONTINGENCIES~~ratios will be reset to the levels in effect in January 2008. The May amendment permits the Company to make additional capital expenditures in 2008 that would otherwise be permitted to be made only in 2009. In connection with the amendment, the Company agreed, among other things, to eliminate the dividend on its common stock following payment of the May 2008 dividend. Also, the amendment adjusted the interest rates as described below. In connection with the amendment, maximum availability under the revolving credit facility was reduced to $77.5 million, after the effective date of the amendment, and the Company agreed to apply certain amounts held in a cash collateral account to prepay approximately $8.0 million on the term loan.

~~There~~ Following the ~~are~~May ~~various~~2008 ~~claims~~amendment, ~~and~~the ~~pending~~applicable ~~legal~~margin ~~actions~~on ~~against~~revolving orcredit ~~directly~~facility ~~involving~~borrowings ~~Centerplate~~will range ~~that~~from ~~are~~2.75% ~~incidental~~ to ~~the~~3.50% ~~conduct~~over ofa ~~its~~defined ~~business.~~prime Itrate isor ~~the~~3.75% ~~opinion~~to of4.50% ~~management,~~over ~~after considering~~ a ~~number~~Eurodollar ~~of factors~~rate, ~~including~~in ~~but~~each case ~~not~~depending ~~limited~~on to the ~~current~~Company’s ~~status~~total ofleverage ~~any~~ratio. The ~~pending proceeding~~applicable ~~(including~~margin ~~any~~for ~~settlement discussions),~~ the ~~views~~term ~~of retained counsel, the nature of the~~loan ~~litigation,~~will ~~prior~~be ~~experience~~3.50% ~~and~~over the ~~amounts~~defined ~~that~~prime ~~have~~rate ~~been~~and ~~accrued~~4.50% ~~for~~over ~~known contingencies, that~~ the Eurodollar ~~ultimate~~rate. ~~disposition~~The ofEurodollar ~~any~~rate ofshall ~~these pending proceedings or contingencies will~~ not ~~have~~be ~~a material~~lower ~~adverse~~than ~~effect on our financial condition or results of operations~~3.0%.

4 The 2008 waivers and amendments were necessitated primarily by a decrease in revenues generated at the Company’s convention center contracts that the Company began to experience in January 2008, as well as more stringent ratio requirements for the payment of dividends and interest under the Credit Agreement effective in January 2008 (going from 2.25:1.00 ~~DEMAND~~in ~~FOR~~2007 ~~REGISTRATION~~to 2.15:1.00 in 2008). In connection with the March and April 2008 amendments, the Company paid approximately $1.0 million in amendment fees and other expenses, which was included in interest expense for the first quarter. The Company expects to incur additional costs of approximately $2.0 million in connection with the May 2008 amendment, which will be included in interest expense for the second quarter.

~~Under~~ If the ~~Registration~~Company ~~Rights~~is unable to meet the Credit Agreement, ~~dated~~financial ~~December 10,~~ratios ~~2003,~~for ~~between~~the payment of monthly installments of interest on the ~~Company~~subordinated ~~and~~notes as set forth in the May 2008 amendment ~~Initial~~or ~~Equity~~as ~~Investors~~set (forth in the ~~“Registration~~Credit ~~Rights~~Agreement after October 2008, the Credit Agreement”) requires the Company to defer interest on the subordinated notes, subject to certain limitations set forth in the indenture. If the Company ~~agreed~~were unable to ~~file~~obtain a further amendment to the Credit Agreement, it is likely that interest on the subordinated notes will need to be deferred after the October 2008 interest payment. Interest on deferred interest accrues at the rate of 13.5% per annum. All interest deferred prior to December 10, 2008 must be paid no later than December 18, 2008, and the Credit Agreement permits this payment even if the required ratios have not been met.

- In 11early May 2008, the Company announced that its Board of Directors has initiated a process to evaluate a range of capital structure and other alternatives and has engaged UBS Securities LLC as the company’s financial advisor to assist in this process. The Company believes its current Income Deposit Security structure may limit its ability to invest to strengthen and grow its business. The Company believes that it will be important to complete the evaluation process within the five-month timeframe provided by the May amendment to the Credit Agreement.

~~Table~~ The ability to comply with the financial covenants may be affected by events beyond the Company’s control, including prevailing economic, financial and industry conditions. A breach of ~~Contents~~any of these covenants could result in a default under the Credit Agreement and/or the indenture governing the subordinated notes. Upon the occurrence of an event of default under the Credit Agreement, the lenders could elect to declare all amounts outstanding, together with accrued interest, to be immediately due and payable. If the Company was unable to repay those amounts, the lenders could proceed against the security granted to them to secure that indebtedness. If the lenders were to accelerate the payment of the indebtedness, the Company’s assets may not be sufficient to repay in full the indebtedness under the credit facility and the indenture.

~~registration statement and undertake a public offering of the remaining interests of the Initial Equity Investors in the Company upon written demand from the Initial Equity Investors~~5. ~~Pursuant~~SUBSEQUENT ~~to the~~EVENTS Amended Stockholders Agreement with the Initial Equity Investors, the Company will issue up to approximately $14.4 million in subordinated notes in exchange for up to 1,543,179 shares of common stock to enable up to 2,517,818 IDSs to be sold on behalf of the Initial Equity Investors. The Company agreed to pay its own costs and all costs and expenses of the Initial Equity Investors in connection with such registration, except underwriting discounts and commissions applicable to the securities sold. In fiscal 2006, the Initial Equity Investors renewed their demand for a registration under the Registration Rights Agreement. On March 23, 2007, the Company filed a registration statement on Form S-3 to register the sale of their interests with the Securities and Exchange Commission (“SEC”). In response to comments received from the SEC, the Company has filed two amendments to the Form S-3, dated May 7, 2007 and May 29, 2007. For the 26 weeks ending July 3, 2007, the Company has recorded approximately $333,000 in costs incurred in connection with this registration as transaction related expenses on the statement of operations. The Company is currently waiting for the Initial Equity Investors to resolve a remaining SEC comment regarding the Initial Equity Investors. The Form S-3 has not been declared effective.

- In 12April 2008, -the Company was informed by the New York Yankees that it will not be the concessionaire for the new Yankee Stadium set to open in 2009. This does not affect Centerplate’s current contract covering the existing Yankee Stadium, which runs through December 31, 2008. Thus, this decision by the Yankees is not expected to affect the Company’s 2008 financial results. In fiscal 2007, the New York Yankees accounted for approximately 9.6% of the Company’s net sales.

~~Table~~ In early May 2008, the Company announced that its Board of ~~Contents~~Directors has initiated a process to evaluate a range of capital structure and other alternatives and has engaged UBS Securities LLC as the company’s financial advisor to assist in this process. The Company believes its current Income Deposit Security structure may limit its ability to invest to strengthen and grow its business. The Company believes that it will be important to complete the evaluation process within the five-month timeframe provided by the May amendment to the Credit Agreement described in Note 4 above.

5. In ~~CONSOLIDATING~~connection ~~CONDENSED~~with ~~INFORMATION~~the May 2008 amendment to the Credit Agreement, the Company agreed to eliminate the monthly dividend payments on its common stock.

~~The~~- ~~$105,245,000 original principal amount of Centerplate’s~~ 13~~.5%~~ ~~subordinated notes are jointly and severally and fully and non~~-~~conditionally guaranteed by each of Centerplate’s direct~~ and indirect 100% owned subsidiaries, except for certain non-100% owned U.S. subsidiaries and one non-U.S. subsidiary. The following table sets forth the consolidating condensed financial statements of Centerplate as of the period ended July 3, 2007 and January 2, 2007 (in the case of the balance sheet) and for the 13 and 26 week periods ended July 3, 2007 and July 4, 2006 (in the case of the statement of operations) and for the 26 week periods ended July 3, 2007 and July 4, 2006 (in the case of the statement of cash flows):

~~Consolidating~~CONSOLIDATING ~~Condensed~~CONDENSED ~~Balance Sheet, July 3, 2007~~INFORMATION

				Guarantor			Non-guarantor
	Centerplate			Subsidiaries			Subsidiaries		Eliminations			Consolidated
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	212		$	30,074		$	4,127	$	—		$	34,413
Accounts receivable		—			25,824			2,285		—			28,109
Other current assets		38			43,947			1,926		—			45,911
Total current assets		250			99,845			8,338		—			108,433
Property and equipment, net		—			50,334			2,306		—			52,640
Contract rights, net		33			78,053			393		—			78,479
Cost in excess of net assets acquired		6,974			34,168			—		—			41,142
Intercompany receivable (payable)		105,803			(113,153	)		366		6,984			—
Investment in subsidiaries		(11,147	)		6,984			—		4,163			—
Other assets		8,368			50,209			1,066		—			59,643
Total assets	$	110,281		$	206,440		$	12,469	$	11,147		$	340,337
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIENCY)
Current liabilities	$	4,031		$	112,827		$	3,902	$	768		$	121,528
Long-term debt		105,245			104,006			—		—			209,251
Other liabilities		—			8,553			—		—			8,553
Total liabilities		109,276			225,386			3,902		768			339,332
Common stock with conversion option, par value $0.01 exchangeable for subordinated debt, net of discount		14,352			—			—		—			14,352
Stockholders’ equity (deficiency):
Common stock		400			—			—		—			400
Additional paid-in capital		218,331			—			—		—			218,331
Accumulated earnings (deficit)		(112,589	)		(18,946	)		7,116		11,830			(112,589	)
Treasury stock and other		(119,489	)		—			1,451		(1,451	)		(119,489	)
Total stockholders’ equity (deficiency)		(13,347	)		(18,946	)		8,567		10,379			(13,347	)
Total liabilities and stockholders’ equity (deficiency)	$	110,281		$	206,440		$	12,469	$	11,147		$	340,337

The $119,596,000 principal amount of Centerplate’s 13.5% subordinated notes are jointly and severally and fully and non-conditionally guaranteed by each of Centerplate’s direct and indirect 100% owned subsidiaries, except for certain non-100% owned U.S. subsidiaries and one non-U.S. subsidiary. The following table sets forth the consolidating condensed financial statements of Centerplate as of the period ended April 1, 2008 and January 1, 2008 (in the case of the balance sheet) and for the 13 week periods ended April 1, 2008 and April 3, 2007 (in the case of the statement of operations and the cash flows):

-Consolidating 13Condensed -Balance Sheet, April 1, 2008 (UNAUDITED)


				Guarantor			Non-guarantor
	Centerplate			Subsidiaries			Subsidiaries		Eliminations			Consolidated
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	221		$	39,690		$	1,494	$	—		$	41,405
Accounts receivable		—			24,431			3,587		—			28,018
Other current assets		22			38,133			1,914		—			40,069

Total current assets		243			102,254			6,995		—			109,492
Property and equipment, net		—			50,446			2,066		—			52,512
Contract rights, net		13			82,030			786		—			82,829
Cost in excess of net assets acquired		6,974			34,168			—		—			41,142
Intercompany receivable (payable)		91,045			(103,465	)		4,408		8,012			—
Investment in subsidiaries		(16,537	)		8,012			—		8,525			—
Other assets		6,824			58,343			3,159		—			68,326


Total assets	$	88,562		$	231,788		$	17,414	$	16,537		$	354,301


LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIENCY)

Current liabilities	$	2,230		$	141,529		$	6,722	$	667		$	151,148
Long-term debt		119,596			103,200			—		—			222,796
Other liabilities		—			12,660			961		—			13,621

Total liabilities		121,826			257,389			7,683		667			387,565


Stockholders’ (deficiency) equity:
Common stock		400			—			—		—			400
Additional paid-in capital		218,331			—			—		—			218,331
Accumulated (deficit) earnings		(132,712	)		(25,601	)		8,074		17,527			(132,712	)
Treasury stock and other		(119,283	)		—			1,657		(1,657	)		(119,283	)

Total stockholders’ (deficiency) equity		(33,264	)		(25,601	)		9,731		15,870			(33,264	)


Total liabilities and stockholders’ (deficiency) equity	$	88,562		$	231,788		$	17,414	$	16,537		$	354,301

~~Consolidating~~- ~~Condensed~~14 ~~Statement of Operations and Comprehensive Income (Loss)~~-

~~Thirteen~~Consolidating ~~Week~~Condensed ~~Period~~Statement ~~Ended~~of ~~July 3,~~Operations ~~2007~~and Comprehensive Income (Loss) (UNAUDITED)

				Guarantor			Non-guarantor
	Centerplate			Subsidiaries			Subsidiaries			Eliminations			Consolidated
	(In thousands)
Net sales	$	—		$	188,121		$	12,718		$	—		$	200,839
Cost of sales (excluding depreciation & amortization)		—			152,259			10,595			94			162,948
Selling, general, and administrative		612			18,051			1,498			—			20,161
Depreciation and amortization		6			7,365			342			—			7,713
Transaction related expenses		333			—			—			—			333
Operating income (loss)		(951	)		10,446			283			(94	)		9,684
Interest expense		3,260			3,797			22			—			7,079
Intercompany interest, net		(3,925	)		3,925			—			—			—
Other income		(3	)		(508	)		(31	)		—			(542	)
Income (loss) before income taxes		(283	)		3,232			292			(94	)		3,147
Income tax provision (benefit)		(80	)		846			141			—			907
Equity in earnings (loss) of subsidiaries		2,443			57			—			(2,500	)		—
Net income (loss)		2,240			2,443			151			(2,594	)		2,240
Other comprehensive income — foreign currency translation adjustment		—			—			636			—			636
Comprehensive income (loss)	$	2,240		$	2,443		$	787		$	(2,594	)	$	2,876

Thirteen Week Period Ended April 1, 2008

- 14 -


				Guarantor			Non-guarantor
	Centerplate			Subsidiaries			Subsidiaries			Eliminations			Consolidated
	(In thousands)
Net sales	$	—		$	117,486		$	15,738		$	—		$	133,224

Cost of sales (excluding depreciation & amortization)		—			102,372			13,737			65			116,174
Selling, general, and administrative		480			17,208			1,521			—			19,209
Depreciation and amortization		5			7,958			323			—			8,286


Operating (loss) income		(485	)		(10,052	)		157			(65	)		(10,445	)
Interest expense		4,334			5,048			13			—			9,395
Intercompany interest, net		(3,925	)		3,925			—			—			—

Other income		(4	)		(140	)		(29	)		—			(173	)

(Loss) income before income taxes		(890	)		(18,885	)		173			(65	)		(19,667	)
Income tax benefit		(377	)		(8,021	)		(87	)					(8,485	)
Equity in (loss) earnings of subsidiaries		(10,669	)		195			—			10,474			—

Net (loss) income		(11,182	)		(10,669	)		260			10,409			(11,182	)
Other comprehensive loss -foreign currency translation adjustment		—			—			(393	)		—			(393	)


Comprehensive loss	$	(11,182	)	$	(10,669	)	$	(133	)	$	10,409		$	(11,575	)

~~Table~~- of15 ~~Contents~~-

Consolidating Condensed Statement of ~~Operations~~Cash ~~and~~Flows ~~Comprehensive Income~~ (~~Loss~~UNAUDITED)

~~Twenty-six~~Thirteen Week Period Ended ~~July~~April 31, ~~2007~~2008

				Guarantor			Non-guarantor
	Centerplate			Subsidiaries			Subsidiaries			~~Eliminations~~Consolidated			~~Consolidated~~
	(In thousands)
Net sales	$	—		$	299,290		$	26,882		$	—		$	326,172
Cash Flows Provided by (Used in) Operating Activities	$	(1,018	)	$	(1,746	)	$	1,276		$	(1,488	)
Cost of sales (excluding depreciation & amortization)		—			246,783			22,287			136			269,206
Cash Flows from Investing Activities:
Selling, general, and administrative		1,035			33,447			2,879			—			37,361
Acquisition of business		—			(1,000	)		—			(1,000	)
Depreciation and amortization		21			14,391			683			—			15,095
Purchase of property and equipment		—			(3,152	)		(272	)		(3,424	)
Transaction related expenses		333			—			—			—			333
Proceeds from sale of property and equipment		—			26			—			26
Operating income (loss)		(1,389	)		4,669			1,033			(136	)		4,177
Contract rights acquired		—			(2,640	)		(156	)		(2,796	)
Interest expense		7,818			7,265			48			—			15,131
Decrease in restricted cash		—			3			—			3
Intercompany interest, net		(7,850	)		7,850			—			—			—
Net cash used in investing activities		—			(6,763	)		(428	)		(7,191	)
Other income		(2	)		(987	)		(55	)		—			(1,044	)
Cash Flows from Financing Activities:
Income (loss) before income taxes		(1,355	)		(9,459	)		1,040			(136	)		(9,910	)
Repayments - revolving loans		—			(7,500	)		—			(7,500	)
Income tax provision (benefit)		(436	)		(3,952	)		286			—			(4,102	)
Borrowings - revolving loans		—			36,000			—			36,000
Equity in earnings (loss) of subsidiaries		(4,889	)		618			—			4,271			—
Net borrowings - swingline loans		—			(1,000	)		—			(1,000	)
Net income (loss)		(5,808	)		(4,889	)		754			4,135			(5,808	)
Principal payments on long-term debt		—			(538	)		—			(538	)
Other comprehensive income — foreign currency translation adjustment		—			—			710			—			710
Dividend payments		(4,155	)		—			—			(4,155	)
Comprehensive income (loss)	$	(5,808	)	$	(4,889	)	$	1,464		$	4,135		$	(5,098	)
Decrease in bank overdrafts		—			(6,871	)		628			(6,243	)
Change in intercompany, net		5,176			2,988			(8,164	)		—
Net cash used in financing activities		1,021			23,079			(7,536	)		16,564
Effect of foreign currency translation on cash		—			—			(333	)		(333	)
Increase (decrease) in cash		3			14,570			(7,021	)		7,552
Cash and cash equivalents - beginning of period		218			25,120			8,515			33,853
Cash and cash equivalents - end of period	$	221		$	39,690		$	1,494		$	41,405

- 1516 -

~~Table~~Consolidating ofCondensed ~~Contents~~Balance Sheet, January 1, 2008 (UNAUDITED)

Consolidating Condensed Statement of Cash Flows


				Combined			Combined
				Guarantor			Non-guarantor
	Centerplate			Subsidiaries			Subsidiaries			Eliminations			Consolidated
							(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	218		$	25,120		$	8,515		$	—		$	33,853
Accounts receivable		—			26,058			3,481			—			29,539
Other current assets		4			30,289			1,832			—			32,125

Total current assets		222			81,467			13,828			—			95,517
Property and equipment		—			49,884			2,102			—			51,986
Contract rights, net		18			84,534			631			—			85,183
Cost in excess of net assets acquired, net		6,974			34,168			—						41,142
Intercompany receivable (payable)		96,219			(100,738	)		(3,756	)		8,275			—
Investment in subsidiaries		(5,473	)		8,275			—			(2,802	)		—
Other assets		6,745			50,546			1,232			—			58,523


Total assets	$	104,705		$	208,136		$	14,037		$	5,473		$	332,351


LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIENCY)

Current liabilities	$	2,643		$	107,574		$	4,108		$	667		$	114,992
Long-term debt		119,596			103,738			—			—			223,334
Other liabilities		—			11,559			—			—			11,559

Total liabilities		122,239			222,871			4,108			667			349,885


Stockholders’ (deficiency) equity:
Common stock		400			—			—			—			400
Additional paid-in capital		218,331			—			—			—			218,331
Accumulated deficit		(117,375	)		(14,735	)		7,879			6,856			(117,375	)
Treasury stock and other		(118,890	)		—			2,050			(2,050	)		(118,890	)

Total stockholders’ (deficiency) equity		(17,534	)		(14,735	)		9,929			4,806			(17,534	)


Total liabilities and stockholders’ (deficiency) equity	$	104,705		$	208,136		$	14,037		$	5,473		$	332,351

~~Twenty~~-~~six~~ ~~Week~~17 ~~Period Ended July 3, 2007~~-

				Guarantor			Non-guarantor
	Centerplate			Subsidiaries			Subsidiaries			Consolidated
	(In thousands)
Cash Flows Provided by (Used in) Operating Activities	$	(2,139	)	$	16,954		$	1,910		$	16,725
Cash Flows from Investing Activities:
Purchase of property and equipment		—			(7,735	)		(375	)		(8,110	)
Proceeds from sale of property and equipment		—			17			—			17
Contract rights acquired		—			(4,043	)		—			(4,043	)
Restricted Cash		—			849			—			849
Net cash used in investing activities		—			(10,912	)		(375	)		(11,287	)
Cash Flows from Financing Activities:
Repayments — revolving loans		—			(41,000	)		—			(41,000	)
Borrowings — revolving loans		—			38,500			—			38,500
Principal payments on long-term debt		—			(538	)		—			(538	)
Dividend payments		(8,920	)		—			—			(8,920	)
Increase in bank overdrafts		—			1,342			—			1,342
Change in intercompany, net		11,061			(10,903	)		(158	)		—
Net cash provided by (used in) financing activities		2,141			(12,599	)		(158	)		(10,616	)
Increase (decrease) in cash		2			(6,557	)		1,377			(5,178	)
Cash and cash equivalents — beginning of period		210			36,631			2,750			39,591
Cash and cash equivalents — end of period	$	212		$	30,074		$	4,127		$	34,413

Consolidating Condensed Statement of Operations and Comprehensive Income (Loss) (UNAUDITED)

-Thirteen 16Week -Period Ended April 3, 2007


				Guarantor			Non-guarantor
	Centerplate			Subsidiaries			Subsidiaries			Eliminations			Consolidated
	(In thousands)
Net sales	$	—		$	111,169		$	14,164		$	—		$	125,333

Cost of sales (excluding depreciation & amortization)		—			94,524			11,692			42			106,258
Selling, general, and administrative		423			15,396			1,381			—			17,200
Depreciation and amortization		15			7,026			341			—			7,382

Operating (loss) income		(438	)		(5,777	)		750			(42	)		(5,507	)
Interest expense		4,558			3,468			26			—			8,052
Intercompany interest, net		(3,925	)		3,925			—			—			—

Other income		1			(479	)		(24	)		—			(502	)

(Loss) income before income taxes		(1,072	)		(12,691	)		748			(42	)		(13,057	)
Income tax (benefit) provision		(356	)		(4,798	)		145						(5,009	)
Equity in (loss) earnings of subsidiaries		(7,332	)		561			—			6,771			—

Net (loss) income		(8,048	)		(7,332	)		603			6,729			(8,048	)
Other comprehensive income - foreign currency translation adjustment		—			—			74			—			74


Comprehensive (loss) income	$	(8,048	)	$	(7,332	)	$	677		$	6,729		$	(7,974	)

~~Consolidating~~- ~~Condensed~~18 ~~Balance Sheet, January 2, 2007~~-

				Combined			Combined
				Guarantor			Non-guarantor
	Centerplate			Subsidiaries			Subsidiaries		Eliminations			Consolidated
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	210		$	36,631		$	2,750	$	—		$	39,591
Accounts receivable		—			21,780			1,392		—			23,172
Other current assets		24			37,923			1,484		—			39,431
Total current assets		234			96,334			5,626		—			102,194
Property and equipment		—			48,295			2,389		—			50,684
Contract rights, net		54			78,699			456		—			79,209
Cost in excess of net assets acquired, net		6,974			34,168			—					41,142
Intercompany receivable (payable)		116,286			(122,640	)		208		6,146			—
Investment in subsidiaries		(6,390	)		6,146			—		244			—
Other assets		8,533			49,818			790		—			59,141
Total assets	$	125,691		$	190,820		$	9,469	$	6,390		$	332,370
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIENCY)
Current liabilities	$	4,844		$	90,858		$	2,230	$	768		$	98,700
Long-term debt		105,245			104,544			—		—			209,789
Other liabilities		—			8,279			—		—			8,279
Total liabilities		110,089			203,681			2,230		768			316,768
Common stock with conversion option, par value $0.01 exchangeable for subordinated debt, net of discount		14,352			—			—		—			14,352
Stockholders’ equity (deficiency):
Common stock		400			—			—		—			400
Additional paid-in capital		218,331			—			—		—			218,331
Accumulated deficit		(97,282	)		(12,861	)		6,498		6,363			(97,282	)
Treasury stock and other		(120,199	)		—			741		(741	)		(120,199	)
Total stockholders’ equity (deficiency)		1,250			(12,861	)		7,239		5,622			1,250
Total liabilities and stockholders’ equity (deficiency)	$	125,691		$	190,820		$	9,469	$	6,390		$	332,370

Consolidating Condensed Statement of Cash Flows (UNAUDITED)

-Thirteen 17Week -Period Ended April 3, 2007


				Guarantor			Non-guarantor
	Centerplate			Subsidiaries			Subsidiaries			Consolidated
	(In thousands)
Cash Flows (Used in) Provided by Operating Activities	$	(1,107	)	$	(10,417	)	$	2,198		$	(9,326	)


Cash Flows from Investing Activities:
Purchase of property and equipment		—			(3,084	)		(222	)		(3,306	)
Proceeds from sale of property and equipment		—			2			—			2
Contract rights acquired		—			(2,397	)		—			(2,397	)
Decrease in restricted cash		—			458			—			458

Net cash used in investing activities		—			(5,021	)		(222	)		(5,243	)


Cash Flows from Financing Activities:
Repayments - revolving loans		—			(11,000	)		—			(11,000	)
Borrowings - revolving loans		—			23,500			—			23,500
Net borrowings - swingline loans		—			4,000			—			4,000
Principal payments on long-term debt		—			(269	)		—			(269	)
Dividend payments		(4,460	)		—			—			(4,460	)
Decrease in bank overdrafts		—			(3,838	)		—			(3,838	)
Change in intercompany, net		5,566			(5,580	)		14			—


Net cash provided by financing activities		1,106			6,813			14			7,933


(Decrease) increase in cash		(1	)		(8,625	)		1,990			(6,636	)

Cash and cash equivalents - beginning of period		210			36,631			2,750			39,591


Cash and cash equivalents - end of period	$	209		$	28,006		$	4,740		$	32,955

~~Consolidating~~- ~~Condensed~~19 ~~Statement of Operations and Comprehensive Income (Loss)~~-

~~Thirteen~~Item 2. ~~Week~~Management’s ~~Period~~Discussion ~~Ended~~and ~~July 4,~~Analysis ~~2006~~of Financial Condition and Results of Operations

				Guarantor			Non-guarantor
	Centerplate			Subsidiaries			Subsidiaries		Eliminations			Consolidated
	(In thousands)
Net sales	$	—		$	177,461		$	13,238	$	—		$	190,699
Cost of sales (excluding depreciation & amortization)		—			143,445			10,567		162			154,174
Selling, general, and administrative		438			15,701			1,274		—			17,413
Depreciation and amortization		24			6,705			345		—			7,074
Contract related losses		—			—			—		—			—
Operating income (loss)		(462	)		11,610			1,052		(162	)		12,038
Interest expense		3,278			2,929			—		—			6,207
Intercompany interest, net		(3,925	)		3,925			—		—			—
Other income, net		(1	)		(367	)		27		—			(341	)
Income before income taxes		186			5,123			1,025		(162	)		6,172
Income tax provision		135			6,103			—		—			6,238
Equity in earnings (loss) of subsidiaries		(117	)		863			—		(746	)		—
Net income (loss)		(66	)		(117	)		1,025		(908	)		(66	)
Other comprehensive income — foreign currency translation adjustment		—			—			308		—			308
Comprehensive income (loss)	$	(66	)	$	(117	)	$	1,333	$	(908	)	$	242

General

- The 18following discussion and analysis of our results of operations and financial condition for the 13 weeks ended April 1, 2008 and April 3, 2007 should be read in conjunction with our audited financial statements, including the related notes, included in our annual report on Form 10-K for the year ended January 1, 2008. The financial data has been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”).

~~Table of Contents~~Overview

~~Consolidating~~ We ~~Condensed~~are ~~Statement~~a leading provider of ~~Operations~~food and ~~Comprehensive~~related ~~Income~~services, ~~(Loss)~~including concessions, catering and merchandise services in sports facilities, convention centers and other entertainment facilities throughout the United States and in Canada. Based on the number of facilities served, we are one of the largest providers of food and beverage services to a variety of recreational facilities in the United States.

~~Twenty~~ We believe that the ability to retain existing accounts and to win new accounts are key factors in maintaining and growing our business. Net sales historically have also increased when there has been an increase in the number of events or attendance at our sports facilities due to a higher number of post-~~six~~season ~~Week~~and ~~Period~~playoff ~~Ended~~games. ~~July 4~~Net sales also have increased as a result of more events at our convention centers and entertainment venues. These higher sales, ~~2006~~along with our ability to control product and labor costs, and our ability to increase per capita spending are primary drivers of earnings before interest, taxes, depreciation and amortization (“EBITDA”) and net income growth.

				Guarantor			Non-guarantor
	Centerplate			Subsidiaries			Subsidiaries		Eliminations			Consolidated
	(In thousands)
Net sales	$	—		$	279,264		$	24,940	$	—		$	304,204
Cost of sales (excluding depreciation & amortization)		—			229,307			20,381		146			249,834
Selling, general, and administrative		1,094			28,607			2,395		—			32,096
Depreciation and amortization		48			13,392			685		—			14,125
Contract related losses		—			100			—		—			100
Operating income (loss)		(1,142	)		7,858			1,479		(146	)		8,049
Interest expense		6,919			5,827			—		—			12,746
Intercompany interest, net		(7,850	)		7,850			—		—			—
Other income, net		(3	)		(679	)		19		—			(663	)
Income (loss) before income taxes		(208	)		(5,140	)		1,460		(146	)		(4,034	)
Income tax provision (benefit)		(15	)		1,645								1,630
Equity in earnings (loss) of subsidiaries		(5,471	)		1,314			—		4,157			—
Net income (loss)		(5,664	)		(5,471	)		1,460		4,011			(5,664	)
Other comprehensive income — foreign currency translation adjustment		—			—			313		—			313
Comprehensive income (loss)	$	(5,664	)	$	(5,471	)	$	1,773	$	4,011		$	(5,351	)

When renewing an existing contract or securing a new contract, we often have to make a capital investment in our client’s facility and agree to pay the client a percentage of the net sales or profits in the form of a commission. We reinvest the cash flow generated by operating activities in order to renew or obtain contracts. We believe that these investments have provided a diversified account base of exclusive, long-term contracts.

- Our 19strategic -initiatives and infrastructure development have helped position our company for growth, but this process is not complete, and we must continue to invest in our business in order to operate successfully in a very competitive environment. In addition, we seek to broaden our strategic horizons and garner a wide range of potential opportunities in order to reduce our dependence on any single account. In 2008, we will look to grow net sales and EBITDA through new accounts, acquisitions and/or joint ventures that will expand upon the scope of our business and enhance our existing operating platforms.

~~Table~~ In early May 2008, we announced that our Board of ~~Contents~~Directors has initiated a process to evaluate a range of capital structure and other alternatives and has engaged UBS Securities LLC as the Company’s financial advisor to assist in this process. We believe our current Income Deposit Security structure may limit our ability to invest to strengthen and grow our business. We also believe that we will complete the evaluation process within the five-month timeframe provided by the May amendment to the Credit Agreement.

~~Consolidating~~Critical ~~Condensed~~Accounting ~~Statement of Cash Flows~~Policies

~~Twenty~~ Our critical accounting policies are those that require significant judgment. There have been no material changes to the critical accounting policies previously reported in our Annual Report on Form 10-~~six~~K ~~Week~~for ~~Period~~the ~~Ended~~year ~~July~~ended January 41, ~~2006~~2008.

				Guarantor			Non-guarantor
	Centerplate			Subsidiaries			Subsidiaries			Consolidated
	(In thousands)
Cash Flows Provided by (Used in) Operating Activities	$	(271	)	$	27,302		$	4,057		$	31,088
Cash Flows from Investing Activities:
Purchase of property and equipment		—			(4,773	)		(60	)		(4,833	)
Proceeds from sale of property and equipment		—			165			—			165
Contract rights acquired		—			(6,818	)		—			(6,818	)
Return of unamortized capital investment		—			1,828			—			1,828
Net cash used in investing activities		—			(9,598	)		(60	)		(9,658	)
Cash Flows from Financing Activities:
Repayments — revolving loans		—			(5,000	)		—			(5,000	)
Borrowings — revolving loans		—			5,000			—			5,000
Net borrowings — swingline loans		—			—			—			—
Principal payments on long-term debt		—			(538	)		—			(538	)
Dividend payments		(8,920	)		—			—			(8,920	)
Increase in bank overdrafts		—			1,716			—			1,716
Change in intercompany, net		9,195			(5,761	)		(3,434	)		—
Net cash provided by (used in) financing activities		275			(4,583	)		(3,434	)		(7,742	)
Increase in cash		4			13,121			563			13,688
Cash and cash equivalents — beginning of period		199			39,612			1,599			41,410
Cash and cash equivalents — end of period	$	203		$	52,733		$	2,162		$	55,098

- 20 -

-Seasonality 20and -Quarterly Results

~~Table~~ Our operating results have varied, and are expected to continue to vary, from quarter to quarter (a quarter is comprised of ~~Contents~~13 or 14 weeks), as a result of factors which include:

~~Item 2.~~• ~~Management’s~~Seasonality ~~Discussion~~and variations in scheduling of sporting and ~~Analysis~~other events; • Variability in the number, timing and type of ~~Financial~~new ~~Condition~~contracts; • Timing of contract expirations and ~~Results~~special events; and • Level of ~~Operations~~ attendance at the facilities which we serve.

~~General~~ Business at the principal types of facilities we serve is seasonal in nature. Major League Baseball (“MLB”) and minor league baseball related sales are concentrated in the second and third quarters, the majority of National Football League (“NFL”) related activity occurs in the fourth quarter, and convention centers and arenas generally host fewer events during the summer months. Results of operations for any particular quarter may not be indicative of results of operations for future periods.

~~The~~ In ~~following~~addition, ~~discussion and analysis of~~ our ~~results~~need ~~of operations and financial condition~~ for ~~the~~ ~~13 weeks~~capital ~~ended~~varies ~~July 3,~~significantly ~~2007~~from ~~and~~quarter ~~July 4,~~to ~~2006~~quarter ~~should~~based ~~be read in conjunction with our audited financial statements, including the related notes, included in our annual report~~ on ~~Form 10-K for~~ the ~~year ended January 2, 2007. The financial data has been prepared in accordance with generally~~ ~~accepted~~timing ~~accounting~~of ~~principles~~contract inrenewals and the ~~United~~contract ~~States~~bidding ~~(“GAAP”)~~process.

~~Overview~~ Set forth below are comparative net sales by quarter (in thousands) for the first quarter of 2008, fiscal 2007, and fiscal 2006:

We are a leading provider of food and related services, including concessions, catering and merchandise services in sports facilities, convention centers and other entertainment facilities. As a part of our food services business, we also provide facility management services for a small number of accounts. We operate throughout the United States and in Canada. Based on the number of facilities served, we are one of the largest providers of food and beverage services to a variety of recreational facilities in the United States.


	2008		2007		2006
1^st Quarter	$	133,224	$	125,333	$	113,505
2^nd Quarter		—	$	200,839	$	190,699
3^rd Quarter		—	$	246,141	$	218,929
4^th Quarter		—	$	168,373	$	157,929

WeResults believe that the ability to retain existing accounts and to win new accounts are key factors in maintaining and growing our net sales. Net sales historically have also increased when there has been an increase in the number of ~~events or attendance at our sports facilities~~Operations particularly in connection with major league sports post-season playoff games. Net sales also have increased as a result of more events at our convention centers and entertainment venues. These higher sales, along with our ability to control product and labor costs, and our ability to increase per capita spending are primary drivers of earnings before interest, taxes, depreciation, and amortization (“EBITDA”) and net income growth.

~~When~~Thirteen ~~renewing~~Weeks anEnded ~~existing contract or securing a new contract~~April 1, we2008 ~~often~~Compared ~~have~~ to ~~make a capital investment in our client’s facility and offer to pay~~ the ~~client~~13 aWeeks ~~percentage~~Ended of the net sales or profits in the form of a commission. We reinvest the cash flow generated by operating activities in order to renew or obtain contracts. We believe that these investments have provided a diversified account base of exclusiveApril 3, ~~long-term contracts.~~2007

We Net ~~continue~~sales to— ~~make~~Net ~~progress~~sales onof ~~our~~$133.2 million ~~four~~for ~~strategic~~the ~~initiatives~~13 weeks —ended ~~culinary~~April 1, ~~excellence~~2008 increased $7.9 million, ~~unique~~or approximately 6.3%, from $125.3 million in the prior year period. The increase was ~~branded~~primarily ~~concepts~~due to $9.2 million in sales from new accounts including the Prudential Center in New Jersey, ~~speed~~home of ~~service~~the NHL’s New Jersey Devils, and ~~facility~~Nationals ~~design~~Park —in ~~which~~Washington, ~~allow~~D.C., ushome toof ~~differentiate~~MLB’s Washington ~~ourselves~~Nationals. In addition, sales at two of the Company’s venues, the University of Phoenix Stadium in Glendale, Arizona and the ~~market~~New Orleans Arena, increased $6.2 million primarily related to the hosting of Super Bowl XLII and ~~ultimately~~the ~~help~~NBA ~~strengthen~~All-Star ~~our~~Game. ~~financial~~These ~~position~~improvements were partially offset by ~~operating~~a ~~more~~decline ~~efficiently~~in sales at our convention centers of $5.0 million and a $1.9 million decline related to the termination of, or decision not to renew, certain contracts. Sales at all other facilities declined $0.6 million.

~~Critical~~ Cost ~~Accounting~~of ~~Policies~~sales – Cost of sales of $116.2 million for the 13 weeks ended April 1, 2008 increased approximately $9.9 million from $106.3 million in the prior year period due in part to the higher sales volume. As a percentage of net sales, cost of sales increased by approximately 2.4% from the prior year period. The increase was primarily the result of higher labor costs driven by softness in our convention

~~Our~~ ~~critical~~- ~~accounting~~21 ~~policies are those that require significant judgment. There have been no material changes to the critical accounting policies previously reported in our Annual Report on Form 10~~-K ~~for the year ended January 2, 2007.~~

~~Seasonality~~centers where, due to the impact of a weakening economy, we experienced a decline in major events and ~~Quarterly~~lower ~~Results~~spending per event. This adversely impacted labor costs due to less favorable economies of scale. Additionally, higher workers compensation expenses associated with several significant one-time claims, and an increase in the workers compensation claims reserve due to lower interest rates further adversely impacted the current period.

~~Our~~ Selling, ~~net~~general ~~sales~~ and ~~operating~~administrative ~~results~~expenses ~~have~~– ~~varied~~Selling, general and ~~are~~administrative ~~expected~~expenses were to$19.2 million ~~continue~~in the 13 weeks ended April 1, 2008 as compared to ~~vary~~$17.2 million in the prior year period, an increase of approximately $2.0 million. As a percentage of net sales, selling, general and administrative costs increased approximately 0.7% from the prior year period. The ~~quarter~~increase towas ~~quarter~~primarily (adriven ~~quarter~~by isthe ~~comprised~~timing of 13expenses orto ~~14 weeks)~~acquire new accounts, ashigher legal fees associated with obtaining a ~~result~~short-term ofamendment ~~factors~~to ~~which~~our credit facility, and start-up expenses at ~~include:~~several new facilities.

• Depreciation ~~seasonality~~and amortization – Depreciation and ~~variations~~amortization inwas ~~scheduling~~$8.3 million offor ~~sporting~~the ~~and~~13 weeks ~~other~~ended ~~events;~~April 1, •2008, ~~unpredictability~~compared to $7.4 million in the ~~number,~~prior ~~timing~~year ~~and~~period. ~~type~~The ofincrease ~~new~~was primarily ~~contracts;~~attributable •to ~~timing~~depreciation ofand ~~contract~~amortization ~~expirations~~related ~~and~~to ~~special~~capital ~~events;~~expenditures associated with account renewals and investments in newly acquired contracts.

- Interest 21expense – Interest expense was $9.4 million for the thirteen weeks ended April 1, 2008, compared to $8.1 million in the prior year period. The increase was principally associated with approximately $1.0 million fees paid to the lenders in connection with the waiver and amendment of certain provisions of our credit agreement in the period (see Note 4 to the Notes to the Consolidated Condensed Financial Statements for additional discussion). Interest expense also reflects additional interest of $0.4 million related to the issuance of $14.4 million in additional subordinated notes in December 2007 as part of the secondary offering of IDSs. In addition, interest expense increased as a result of higher outstanding revolver borrowings under our credit facility in the current period and interest charges related to our interest rate swap agreement ($0.4 million). Partially offsetting these increases was a decline in non-cash interest expense of $0.5 million in the period related to changes in the fair market value of our derivative.

~~Table~~ Other income, net – Other income consisting of ~~Contents~~interest income declined $0.3 million from the prior year period primarily due to lower average cash balances during the 2008 period.

• Income ~~level~~taxes of– ~~attendance~~The atincome tax benefit for the ~~facilities~~13 weeks ~~which~~ended weApril 1, ~~serve~~2008 and April 3, 2007 were calculated using the projected annual effective tax rate (“ETR”) for fiscal 2008 and 2007, respectively, in accordance with Accounting Principles Board Opinion No. 28, Interim Financial Reporting (APB 28), and Financial Accounting Standards Board (FASB) Interpretation No. 18, Accounting for Income Taxes in Interim Periods – an interpretation of APB Opinion No. 28 (FIN 18).

~~Business~~ We atestimate that in the ~~principal~~fiscal ~~types~~year ofending ~~facilities~~December 30, 2008, we ~~serve~~will ishave ~~seasonal~~an inannual ~~nature~~ETR of approximately 67%. ~~Major~~In ~~League Baseball~~the ~~(“MLB”)~~prior ~~and~~year ~~minor~~period, ~~league~~we ~~baseball~~estimated ~~related~~that ~~sales~~our ~~are~~annual ~~concentrated~~ETR infor the ~~second~~fiscal ~~and third~~year ~~quarters~~ended January 1, ~~the~~2008 ~~majority~~would ofbe ~~National~~40%. ~~Football~~The ~~League~~fluctuation ~~(“NFL”)~~in ~~related~~the ~~activity~~projected ~~occurs~~effective inannual ~~the~~tax ~~fourth~~rate is ~~quarter,~~primarily ~~and~~due ~~convention~~to ~~centers~~the ~~and~~sensitivity ~~arenas~~of ~~generally~~the ~~host~~ratio ~~fewer~~involving ~~events~~expected ~~during~~ordinary ~~the~~income ~~summer~~and ~~months.~~permanent ~~Results~~items of(primarily ~~operations~~the ~~for~~interest ~~any~~charge ~~particular~~related ~~quarter~~to ~~may~~the ~~not~~Company’s bederivatives). ~~indicative~~(See ofincome ~~results~~tax section under “Summary of ~~operations~~Significant Accounting Policies” for ~~future~~ ~~periods~~a more detailed discussion.)

In For ~~addition~~the 13 weeks ended April 1, ~~our~~2008, ~~need~~the projected annual effective tax rate of 67% was not utilized to record the Company’s tax benefit for ~~capital~~the ~~varies~~period, ~~significantly~~due ~~from~~to ~~quarter~~the limitations applicable pursuant to the guidance provided by FIN 18 “Accounting for Income Taxes In Interim Periods” (an interpretation of APB No. 28). Our annual effective tax rate is revised as of the end of each quarter, ~~based~~in onaccordance with APB Opinion No. 28. As a result, the interim income tax provision (or ~~timing~~benefit) can fluctuate due to many factors, including changes in the projected book income, fluctuations in the valuation of ~~contract~~the ~~renewals~~company’s derivative, permanent tax adjustments, tax credits and discrete items within the ~~contract~~first ~~bidding~~quarter. ~~process~~The annual effective tax rate is revised at the end of each successive interim period during the fiscal year to our current best estimate in accordance with APB 28.

~~Set~~ ~~forth~~- ~~below~~22 ~~are~~- ~~comparative net sales by quarter (in thousands) for the first and second~~ ~~quarters of 2007, fiscal 2006, and fiscal 2005:~~

	2007		2006		2005
1st Quarter	$	125,333	$	113,505	$	107,220
2nd Quarter	$	200,839	$	190,699	$	182,071
3rd Quarter		—	$	218,929	$	208,619
4th Quarter		—	$	157,929	$	145,202

Liquidity and Capital Resources

~~Results~~ Net cash used in operating activities was $1.5 million for the 13 weeks ended April 1, 2008, compared to $9.3 million in the prior year period. The improvement was primarily due to fluctuations in working capital, which varies from quarter to quarter as a result of ~~Operations~~the timing and number of events at the facilities we serve, partially offset by an increase in operating losses.

~~Thirteen~~ Net ~~Weeks~~cash ~~Ended~~used ~~July~~in investing activities was $7.2 3million for the 13 weeks ended April 1, ~~2007~~2008, as ~~Compared~~compared to $5.2 million in the 13prior ~~Weeks~~year ~~Ended~~period. ~~July~~The increase of $2.0 4,million ~~2006~~is principally attributable to additional capital invested in new accounts and an acquisition of a 51% controlling interest in Harry’s Tap Room, which will be accounted for on the equity method.

Net ~~sales~~cash —provided ~~Net~~by ~~sales~~financing ofactivities was $~~200~~16.86 million ~~for~~in the 13 weeks ended ~~July~~April ~~3, 2007 increased $10.~~1 ~~million~~, 2008 oras ~~approximately~~compared ~~5.3%,~~to ~~from~~ $~~190.~~7.9 million in the prior year period. The increase was primarily due to ~~higher sales at our MLB and minor league baseball facilities, convention centers and new accounts. MLB sales improved $4.5 million compared to prior year period due primarily to~~ an increase ~~in attendance and per capita spending at a number~~ of ~~our MLB facilities. Sales at the company’s minor league baseball accounts were up~~ $216.60 million ~~mainly due to 19 additional games played during the period. Convention center sales increased $2.5 million primarily due to an increase~~ in ~~the~~net ~~number~~revolver ofborrowings ~~events~~under ~~at some of~~ our ~~facilities.~~credit Infacility ~~addition,~~in ~~sales at our NFL facilities increased $1.7 million due chiefly to~~ the ~~re-opening~~2008 ~~of the Louisiana Superdome, which was closed for renovations during the prior year~~ period. ~~Sales at our new accounts increased~~ approximately $3.5 million primarily due to the addition of a spring training facility and four minor league baseball accounts. Partially offsetting these improvements was the termination of some of our contracts which accounted for a decline in sales of $3.7 million.

~~Cost~~ We are ofalso ~~sales~~often –required ~~Cost~~to ofobtain ~~sales~~performance bonds, bid bonds or letters of ~~$162.9 million~~credit ~~for~~to secure ~~the~~our ~~13 weeks~~contractual ~~ended~~obligations. ~~July~~As of April 31, ~~2007~~2008, ~~increased~~we had requirements outstanding for ~~approximately~~performance bonds and letters of credit of $820.81 million ~~from~~and $~~154~~22.28 million, inrespectively. Under the credit ~~prior~~facility, ~~year~~we ~~period~~have ~~due~~an inaggregate ~~part~~of ~~to the higher sales volume~~$35.0 million Asavailable afor ~~percentage~~letters of ~~net sales~~credit, ~~cost~~subject ofto an ~~sales~~overall ~~increased~~borrowing bylimit ~~approximately~~(initially 0of $107.3%5 million, ~~from the~~reduced ~~prior~~to ~~year period~~$77.5 million ~~The~~in ~~increase~~the ~~was~~May ~~the~~2008 ~~result~~amendment). As of ~~higher~~April 1, ~~product~~2008, ~~costs~~we athad ~~our~~approximately ~~sports and~~$27.7 ~~convention~~million ~~center~~available ~~facilities.~~to ~~The~~be ~~increase~~borrowed ~~was~~under ~~partially~~the ~~offset~~revolving ~~by lower~~portion ~~labor~~of ~~and~~the ~~commission~~credit ~~costs~~facility. At that date, ~~predominantly~~there atwere ~~our~~$57.0 million ~~MLB~~in outstanding borrowings and ~~minor~~$22.8 million ~~league~~of ~~baseball~~outstanding, ~~facilities~~undrawn letters of credit reducing availability.

~~Selling,~~ We ~~general~~believe ~~and~~that ~~administrative~~cash ~~expenses~~flow –from ~~Selling~~operating activities, ~~general~~together ~~and~~with ~~administrative~~borrowings ~~expenses~~available under ~~were~~the ~~$20.2 million~~revolving inportion of the ~~13 weeks~~credit ~~ended July 3~~facility, ~~2007~~will asbe ~~compared~~sufficient to ~~$17.4 million~~fund inour ~~the~~currently ~~prior~~anticipated ~~year~~capital ~~period~~investment requirements, aninterest ~~increase~~(subject ofto ~~approximately~~limitations contained $2in the Credit Agreement), and working capital requirements.~~7 million.~~ AsIn afiscal ~~percentage~~2008, contracts representing 19.4% of our 2007 net sales, ~~selling~~or $144.0 million, ~~general~~ are up for renewal and ~~administrative~~as ~~costs~~a result ~~increased~~we ~~approximately~~expect 0to spend $20.9%0 million ~~from~~to ~~the~~$25.0 million ~~prior~~in ~~year~~maintenance ~~period.~~capital ~~The~~expenditures to ~~increase~~renew ~~was~~these ~~primarily~~contracts, ~~due~~including torollover ~~expenses~~capital expenditures associated with ~~building~~ our ~~strategic~~2007 commitments. ~~platform~~In ~~including~~addition, we are anticipating growth capital expenditures in the range of ~~higher~~$10.0 million ~~outside~~to $15.0 million to acquire new contracts.

- In the 22first -quarter, we obtained waivers and amendments of certain provisions of the credit agreement temporarily affecting the calculation of the ratios that must be achieved in order to pay dividends. In May 2008, we obtained an additional amendment to the credit agreement that adjusted the ratios that must be achieved in order to pay monthly installments of interest on the subordinated notes through October 2008. In connection with the May amendment, we agreed to eliminate the dividend on the common stock. In addition, the revolving credit facility was reduced to $77.5 million, effective after the date of the amendment, and we agreed to apply certain amounts held in a cash collateral account to prepay approximately $8.0 million on the term loan. The revolving credit facility is being reduced by the excess and unused portion of the revolver, and we believe this reduction will have minimal, if any, adverse impact on liquidity. The waiver and amendments were necessitated primarily by a decrease in revenues generated at our convention centers that we began to experience in January 2008, as well as a more stringent senior leverage ratio requirement for the payment of dividends under the credit agreement in 2008 (going from 2.25:1.00 in 2007 to 2.15:1.00 in 2008).

~~Table~~ If we are unable to meet the Credit Agreement financial ratios for the payment of ~~Contents~~monthly installments of interest on the subordinated notes as set forth in the May 2008 amendment or as set forth in the Credit Agreement after October 2008, the Credit Agreement requires the Company to defer interest on the subordinated notes, subject to certain limitations set forth in the indenture. If we were unable to obtain a further amendment to the Credit Agreement, it is likely that interest on the subordinated notes will need to be deferred after the October 2008 interest payment. Interest on deferred interest accrues at the rate of 13.5% per annum.. All interest deferred prior to December 10, 2008 must be paid on December 18, 2008, and the Credit Agreement permits this payment even if the required ratios have not been met.

~~professional~~ In early ~~expenses~~May 2008, ~~such~~we asannounced ~~legal~~that ~~fees~~our ~~and~~Board ~~higher~~of ~~compensation~~Directors ~~and~~has ~~benefits expense~~initiated ~~primarily~~a ~~related~~process to evaluate ~~the~~a ~~addition~~range of ~~corporate~~capital ~~management~~structure ~~personnel.~~and ~~Also~~other ~~contributing~~alternatives toand have engaged UBS Securities LLC as the ~~increase~~company’s infinancial ~~selling,~~advisor ~~general~~to ~~and~~assist ~~administrative~~in ~~costs~~this ~~were~~process. ~~higher~~We ~~other~~believe ~~operating~~our ~~expenses~~current ~~from~~Income Deposit anSecurity ~~increase~~structure inmay ~~credit~~limit ~~card~~our ~~fees~~ability ~~related~~ to ~~the~~invest ~~installation~~to strengthen and ~~upgrade~~grow ofour ~~credit~~business. ~~card~~We ~~capabilities~~believe atthat ~~certain~~it ~~venues~~will be important to complete the evaluation process within the five-month timeframe provided by the May amendment to the Credit Agreement.

~~Depreciation~~New ~~and~~Accounting ~~amortization – Depreciation and amortization was $7.7 million for the 13~~Standards weeks ended July 3, 2007, compared to $7.1 million in the prior year period. The increase was principally attributable to depreciation and amortization related to capital expenditures associated with account renewals, primarily at our NFL facilities and convention centers, and investments in newly acquired contracts.

~~Transaction~~ See ~~related~~Note ~~expenses~~2 –to ~~$0.3 million in expenses were incurred in~~ the ~~13 weeks~~Notes ~~ended July 3, 2007 in connection with the follow-on offering~~ to the ~~Company’s~~Consolidated ~~2003~~Condensed ~~initial~~Financial ~~public offering~~Statements ~~(see Note 4, Demand~~ for ~~Registration,~~a insummary ~~our~~of new ~~Notes~~accounting ~~to the Consolidated Condensed Financial Statements)~~standards.

~~Interest~~ ~~expense~~- –23 ~~Interest~~- ~~expense was $7.1 million for the thirteen weeks ended July 3,~~ 2007, compared to $6.2 million in the prior year period. The increase was principally attributable to an increase in interest expense associated with higher outstanding revolver borrowings under our credit facility in the current period to finance capital expenditures and working capital requirements.

~~Other~~Cautionary ~~income~~Statement –Regarding ~~Other~~Forward-looking ~~income consisting of interest income was $0.5 million in the 13 weeks~~Statements ended July 3, 2007 as compared to $0.3 million in the prior year period. The increase was principally attributable to interest generated from higher cash balances, including restricted accounts, in the current period.

~~Income~~ Some ~~taxes~~of ~~– Income taxes for~~ the ~~13 weeks~~statements ~~ended~~under ~~July 3,~~“Management’s ~~2007~~Discussion and ~~July 4,~~Analysis ~~2006~~of ~~were calculated~~Financial ~~using~~Condition ~~the~~and Results ~~projected~~of ~~annual effective tax rate (“ETR~~Operations,”) ~~for fiscal 2007~~ and ~~2006, respectively,~~elsewhere in ~~accordance~~this ~~with~~Quarterly ~~Accounting~~Report ~~Principles~~on ~~Board~~Form ~~Opinion~~10-Q ~~No. 28,~~may ~~Interim~~be ~~Financial~~forward-looking ~~Reporting~~statements ~~(APB~~within ~~28),~~the ~~and~~meaning ~~FASB~~of ~~Interpretation No.~~Section ~~18,~~27A ~~Accounting~~of ~~for~~the ~~Income~~Securities ~~Taxes~~Act ~~in Interim Periods - an interpretation~~ of ~~APB~~1933 ~~Opinion~~and ~~No.~~Section 2821E ~~(FIN~~of ~~18). We estimate that in~~ the ~~fiscal year ending~~ ~~January 1,~~Securities ~~2008,~~Exchange weAct ~~will have an annual ETR~~ of ~~approximately -43%~~1934. InThese ~~the~~statements ~~prior~~reflect ~~year period, we estimated that~~ our ~~annual~~current ~~ETR~~views ~~for~~with ~~the~~respect ~~fiscal year ended January 2, 2007 would be -40%. The fluctuation in the projected effective annual tax rate is primarily due~~ to ~~the sensitivity of the~~future ~~ratio~~events ~~involving~~and ~~expected~~financial ~~ordinary~~performance. ~~income~~These ~~and~~statements ~~permanent~~may ~~items~~include ~~(primarily~~ the ~~interest~~words ~~charge~~“expect,” ~~related~~“intend,” to“plan,” ~~the Company’s derivatives). (See Note 2~~“believe,” ~~Income Taxes section~~“project,” to“anticipate” ~~the~~and ~~Notes~~similar tostatements ~~the~~of ~~Consolidated Condensed Financial Statements for~~ a ~~more~~future ~~detailed~~or ~~discussion~~forward-looking nature.)

~~Our~~ All ~~actual~~forward-looking ~~ETR~~statements ~~for~~address ~~the~~matters ~~13 weeks~~that ~~ended~~involve ~~July 3,~~risks ~~2007~~and ~~was~~uncertainties ~~23%.~~that ~~This is the result of a change in~~could ~~our~~cause ~~projected~~actual ~~annual~~results ~~ETR~~to ~~for~~differ ~~fiscal~~materially ~~2007~~ from ~~the~~those ~~rate~~indicated ~~calculated~~in atthese ~~the~~statements ~~end~~or ofthat ~~first quarter 2007.~~could ~~Our~~adversely ~~projected~~affect ~~annual ETR at~~ the ~~end~~holders of ~~first~~our ~~quarter was -40%~~securities. ~~Our~~Some ~~annual~~of ~~ETR~~these isrisks ~~revised,~~and asuncertainties ofare ~~the~~discussed ~~end~~under of“Risk ~~each~~Factors” ~~successive~~in ~~interim period during the fiscal year to~~ our ~~current~~Annual ~~best~~Report ~~estimate,~~on ~~in accordance~~Form ~~with~~10-K ~~APB 28. The resulting tax expense recorded~~ for the ~~13 weeks~~year ended ~~July~~January 31, ~~2007 is~~2008 ~~a product of applying our revised annual ETR to our year to date ordinary income. The fluctuation of the ETR calculated as of the end of first quarter 2007 of -40%~~ and ~~the~~Item 1A ~~revised annual projected ETR as~~ of ~~the~~Part II ~~end~~ of ~~second~~this ~~quarter~~Quarterly ~~2007~~Report ofon ~~-43%~~Form ~~as applied to our year to date ordinary income results in the second quarter cumulative adjustment to income tax expense/(benefit)~~10-Q.

~~Our~~ Any ~~annual~~forward-looking ~~ETR~~statement isspeaks ~~revised~~only as of the ~~end~~date ofon ~~each~~which ~~quarter,~~such instatement ~~accordance~~is ~~with~~made, ~~APB Opinion No.~~and ~~28.~~we Asundertake ano ~~result,~~obligation ~~the~~to ~~interim~~publicly ~~income~~update ~~tax provision (~~or ~~benefit)~~review ~~can~~any ~~fluctuate~~forward-looking ~~due~~statement, towhether ~~many~~as ~~factors,~~a ~~including~~result ~~changes in the projected book income, fluctuations in the valuation~~ of ~~our~~new ~~derivative~~information, ~~permanent~~ ~~tax~~future ~~adjustments,~~developments ~~and~~or ~~tax credits~~otherwise. ~~The annual effective tax rate is revised at the end of~~ ~~each successive interim period during the fiscal year to our current best estimate in accordance with APB 28.~~

~~Twenty-six Weeks Ended July~~ Item 3. ~~2007~~Quantitative ~~Compared~~and toQualitative ~~the~~Disclosures 26about ~~Weeks~~Market ~~Ended July 4, 2006~~Risk.

- Interest 23rate risk –We are exposed to interest rate volatility with regard to our revolving credit facility borrowings and term loan. As of April 1, 2008, we had $57.0 million in outstanding borrowings under the revolving portion of our credit facility and a $104.3 million balance on our term loan. A change in interest rate of one percent on these borrowings would cause a change in the annual interest expense of $1.6 million. In order to minimize our exposure to interest rate risk we have entered into an interest rate swap agreement for a notional amount of $100 million. The agreement is based on three months LIBOR and contains a collar feature with an interest rate floor of 4.82% and cap of 6.0%. As of April 1, 2008, cash and non-cash charges of $0.4 million and $0.2 million, respectively, were recorded to our consolidated statement of operations to record interest expense under the swap agreement and changes in the fair value of this derivative, respectively. As of April 1, 2008, there is no market or quotable price for our subordinated notes, because there is no separate market for the notes, thus it is impracticable to estimate their fair value. The fair value of the term loan approximates par.

~~Table~~ As of ~~Contents~~April 1, 2008, there have been no material changes, except as discussed above, in the quantitative and qualitative disclosures about market risk from the information presented in our Form 10-K for the year ended January 1, 2008.

~~Net sales — Net sales of $326.2~~Item ~~million for the 26 weeks ended July 3, 2007 increased $22~~4.~~0 million,~~ orControls ~~approximately 7.2%, from $304.2 million in the prior year period. The increase was primarily due to higher sales at our NFL, MLB,~~ and ~~convention center facilities of $7~~Procedures.~~6 million,~~ $6.0 million, and $6.3 million, respectively. The increase in NFL sales was primarily due to the re-opening of the Louisiana Superdome, which was closed for renovations during the prior year period, and the 2007 BCS Championship Game and Fiesta Bowl held at the University of Phoenix Stadium. MLB sales increased as a result of an increase in attendance and per capita spending at a number of our facilities. Sales at convention centers increased due to the number and size of events in the current period. In addition, new accounts contributed $7.6 million and sales at all other facilities increased $1.4 million. Partially offsetting these improvements was the termination of some of our contracts which accounted for a decline in sales of $6.9 million.

~~Cost~~Evaluation of ~~sales~~disclosure –controls Cost of sales of $269.2 million for the 26 weeks ended April 3, 2007 increased approximately $19.4 million from $249.8 million in the prior year period due in part to the higher sales volume. As a percentage of net sales, cost of sales increased by approximately 0.4% from the prior year period. The increase was the result of higher product costs at our sports and ~~convention~~ ~~center facilities~~procedures. ~~The increase was partially offset by lower labor and commission~~ ~~costs, predominantly at our NFL and MLB facilities attributable in part to the higher sales volume.~~

~~Selling,~~ We ~~general~~maintain disclosure controls and ~~administrative~~procedures ~~expenses~~designed –to ~~Selling,~~ensure ~~general~~that ~~and~~information ~~administrative~~required ~~expenses~~to ~~were~~be ~~$37.4 million~~disclosed in ~~the~~our ~~26 weeks~~reports ~~ended~~under ~~April 3,~~the ~~2007~~Securities asExchange ~~compared~~Act toof ~~$32.1 million~~1934, inas ~~the~~amended, ~~prior year~~is ~~period~~recorded, processed, ansummarized ~~increase~~and ofreported ~~approximately~~within ~~$5.3 million.~~the Astime aperiods ~~percentage~~specified ofin ~~net~~the ~~sales,~~SEC ~~selling~~rules and forms, ~~general~~ and ~~administrative~~that ~~costs~~such ~~increased~~information ~~approximately~~is ~~0.9%~~accumulated ~~from~~and ~~the~~communicated ~~prior~~to ~~year~~our ~~period.~~management, ~~The~~including our Chief ~~increase~~Executive ~~was~~Officer ~~due~~and toChief ~~expenses~~Financial ~~associated~~Officer, ~~with~~as ~~building~~appropriate, ~~our~~to ~~strategic~~allow ~~platform~~timely ~~including~~decisions ~~higher~~regarding ~~outside~~required ~~professional~~disclosures. ~~expenses~~Any ~~such~~controls asand ~~legal~~procedures, ~~fees~~no ~~and~~matter ~~higher~~how ~~compensation~~well designed and ~~benefits~~operated, ~~expense~~can ~~primarily~~provide ~~related~~only toreasonable assurance of achieving the ~~addition~~desired ofcontrol ~~corporate~~objectives. Our management, with ~~personnel.~~the ~~Also~~participation ~~contributing~~of tothe Chief Executive Officer and the Chief Financial Officer, evaluated ~~increase~~the ~~were~~effectiveness ~~higher~~of ~~other~~the ~~operating~~design ~~costs~~and atoperation of our ~~facilities~~disclosure ~~notably~~controls asand aprocedures ~~result~~as of ~~opening~~April ~~expenses~~1, ~~associated~~2008. ~~with~~Based ~~new~~upon ~~accounts~~that evaluation and ~~also~~subject to the ~~re-opening~~foregoing, ofour ~~the~~Chief ~~Louisiana~~Executive ~~Superdome.~~Officer Inand ~~addition,~~Chief ~~higher~~Financial ~~credit~~Officer ~~card~~concluded ~~fees~~that ~~during~~ the ~~current~~design ~~year~~and ~~period~~operation ~~related~~of toour ~~the~~disclosure ~~installation~~controls and ~~upgrade~~procedures ofprovided ~~credit~~reasonable ~~card~~assurance ~~capabilities~~that atthe ~~certain~~disclosure ~~facilities~~controls ~~also~~and ~~contributed~~procedures toare ~~the increase in~~effective ~~selling,~~to ~~general~~accomplish ~~and~~their ~~administrative costs~~objectives.

~~Depreciation~~ ~~and~~- ~~amortization~~24 –- ~~Depreciation and amortization was $15.1 million for the 26~~ weeks ended July 3, 2007, compared to $14.1 million in the prior year period. The increase was principally attributable to depreciation and amortization related to capital expenditures associated with account renewals, notably at our NFL facilities and convention centers, and investments in newly acquired contracts.

~~Transaction~~ During ~~related~~the ~~expenses~~period –covered ~~$0.3 million~~by inthis ~~expenses~~report ~~were~~there ~~incurred~~have inbeen ~~the~~no ~~26 weeks~~changes ~~ended July 3, 2007~~ in ~~connection~~our ~~with~~internal ~~the~~control over ~~follow-on~~financial ~~offering~~reporting tothat ~~the~~have ~~Company’s~~materially ~~2003~~affected ~~initial~~or ~~public offering~~are ~~(see~~reasonably ~~Note~~likely 4,to ~~Demand~~materially affect ~~for Registration, in~~ our ~~Notes~~internal tocontrol ~~the~~over ~~Consolidated~~financial ~~Condensed Financial Statements)~~reporting.

~~Contract~~PART ~~Related Losses – In the prior year period, a non-cash charge of $0.1 million was~~II ~~taken~~OTHER ~~for the write-off of certain assets associated with a terminated contract.~~INFORMATION

~~Interest expense – Interest expense was $15.1~~Item ~~million for the 26 weeks ended July 3, 2007, compared to $12.7 million in the prior year period. The increase was primarily attributable to higher interest of $~~1.~~3 million~~ ~~associated~~– ~~with~~Legal ~~higher outstanding revolver borrowings under our~~Proceedings credit facility in the current period to finance capital expenditures and working capital requirements, and an increase in interest rates associated with our term loan. In addition, the current year period reflected a $0.1 million non-cash charge related to the change in the fair value of our derivatives as compared to a credit of $0.9 million in the prior year period, which resulted in a $1.0 million increase in interest expense.

~~Other~~ See Note ~~income~~3 –(Commitments ~~Other~~and ~~income~~Contingencies) ~~consisting of interest income was $1.0 million~~ in the ~~26 weeks ended~~Notes ~~July 3, 2007 as compared~~ to ~~$0.7 million in~~ the ~~prior~~Consolidated ~~year~~Condensed ~~period.~~Financial ~~The increase was~~Statements. ~~principally~~

-Item 1A. 24– -Risk Factors

~~Table~~ There ofhas ~~Contents~~been no material change to the disclosure in our Annual Report on Form 10-K for the fiscal year ended January 1, 2008, except as disclosed in Note 4 (Debt) and Note 5 (Subsequent Events) in the Notes to the Consolidated Condensed Financial Statements.

~~attributable~~Item 6. ~~to interest generated from higher cash balances, including restricted~~Exhibits ~~cash, in the current period.~~

Income taxes – Income taxes for the 26 weeks ended July 3, 2007 and July 4, 2006 were calculated using the projected annual ETR for fiscal 2007 and 2006, respectively, in accordance with SFAS No. 109 “Accounting for Income Taxes”. We currently estimate that in the fiscal year ending January 1, 2008, we will have an annual ETR of approximately -43%. In the prior year period, we estimated that our annual ETR for the fiscal year ended January 2, 2007 would be -40 %. The fluctuation in the projected effective annual tax rate is primarily due to the sensitivity of the ratio involving expected ordinary income and permanent items (~~primarily the interest charge related to the Company’s derivatives~~a)~~. For the 26~~ ~~weeks ended July 3, 2007, the projected annual~~Exhibits: ETR of -43% was not utilized to record the Company’s tax benefit for the period, due to the limitation applicable pursuant to the guidance provided by FIN 18 “Accounting for Income Taxes In Interim Periods” (an interpretation of APB No. 28). Our annual ETR is revised as of the end of each quarter, in accordance with APB Opinion No. 28. As a result, the interim income tax provision (or benefit) can fluctuate due to many factors, including changes in the projected book income, fluctuations in the valuation of our derivative, permanent tax adjustments, and tax credits. The annual ETR is revised at the end of each successive interim period during the fiscal year to our current best estimate in accordance with APB 28.

Liquidity and Capital Resources

10.1		Form of Sixth Amendment to Credit Agreement made and entered into as of May 19, 2008, by and among Volume Services America, Inc., Volume Services, Inc., Service America Corporation, Centerplate, Inc., the Lenders signatory thereto, and General Electric Capital Corporation, as Lender and as Administrative Agent.

31.1		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes- Oxley Act of 2002.

31.2		Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

~~Net cash~~ ~~provided~~- by25 ~~operating~~- ~~activities was $16.7 million for the 26 weeks ended July 3, 2007,~~ compared to $31.1 million in the prior year period. The increase was primarily due to higher operating losses, as discussed above, and fluctuations in working capital, which varies from quarter to quarter as a result of the timing and number of events at the facilities we serve.

~~Net cash used in investing activities was $11.3 million for the 26 weeks ended July 3, 2007,~~SIGNATURES as compared to $9.7 million in the prior year period. The increase of $1.6 million is principally attributable to the non-recurrence of the return of unamortized investment of $1.8 million from a terminated contract in the prior year period.

~~Net~~ Pursuant ~~cash~~to ~~used~~the inrequirements ~~financing~~of ~~activities~~the ~~was~~Securities ~~$10.6 million~~Exchange inAct ~~the~~of ~~26 weeks ended July 3~~1934, ~~2007 as compared to $7.7 million in~~ the ~~prior~~registrant ~~year~~has ~~period.~~duly caused ~~The~~this ~~increase~~report ~~was due~~ to ~~the~~be ~~net~~signed ~~repayment~~on ~~of $2.5 million~~its inbehalf ~~revolver~~by ~~borrowings~~the ~~under~~undersigned, ~~our~~thereunto ~~credit~~duly ~~facility~~authorized, inon ~~the~~May 19, ~~2007 period~~2008.

~~We are also often required to obtain performance bonds~~Centerplate, ~~bid bonds or letters of credit to secure our contractual obligations~~Inc. AsBy: of/s/ ~~July 3,~~Kevin ~~2007, we had requirements outstanding for performance bonds and letters of credit of $18~~F.~~2 million~~ ~~and~~McNamara ~~$21.1 million,~~Name: ~~respectively.~~Kevin ~~Under the credit facility, we have an aggregate of $35~~F.~~0 million~~ ~~available~~McNamara ~~for~~Title: ~~letters~~Chief ofFinancial credit, subject to an overall borrowing limit of $107.5 million. As of July 3, 2007, we had approximately $73.9 million available to be borrowed under the revolving portion of the credit facility. At that date, there were $12.5 million in outstanding borrowings and $21.1 million of outstanding, undrawn letters of credit reducing availability. Officer

We ~~believe~~- ~~that~~26 ~~cash~~- ~~flow from operating activities, together with borrowings available under~~ the revolving portion of the credit facility, will be sufficient to fund our currently anticipated capital investment requirements, interest, dividend payments and working capital requirements. In fiscal 2007, contracts representing 18.7% of our 2006 net sales, or $127.5 million, are up for renewal. We expect to spend $20.0 million to $25.0 million in maintenance capital expenditures, which also includes capital expenditure commitments associated with contracts renewed and/or acquired in 2006. In addition, we are anticipating growth capital expenditures in the range of $15.0 million to $20.0 million. As a result of the anticipated capital expenditures, our borrowings may increase in the second half of 2007.

In addition, while the declaration of dividends is at the sole discretion of our board of directors, we expect to pay dividends on our common stock at the same rate as fiscal 2006 (approximately $17.8 million, of which $8.9 million was paid as of July 3, 2007).

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New Accounting Standards

See New Accounting Standards section of Note 2 in the Notes to the Consolidated Condensed Financial Statements for a summary of new accounting standards.

Cautionary Statement Regarding Forward-looking Statements

Some of the statements under “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and elsewhere in this Quarterly Report on Form 10-Q may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements reflect our current views with respect to future events and financial performance. These statements may include the words “expect,” “intend,” “plan,” “believe,” “project,” “anticipate” and similar statements of a future or forward-looking nature.

All forward-looking statements address matters that involve risks and uncertainties that could cause actual results to differ materially from those indicated in these statements or that could adversely affect the holders of our securities. Some of these risks and uncertainties are discussed under “Risk Factors” in our Annual Report on Form 10-K for the year ended January 2, 2007.

Any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

Interest rate risk –We are exposed to interest rate volatility with regard to our revolving credit facility borrowings and term loan. As of July 3, 2007, we had $12.5 million in outstanding borrowings under the revolving portion of our credit facility and a $105.1 million balance on our term loan. A change in interest rate of one percent on these borrowings would cause a change in the annual interest expense of $1.2 million. In order to minimize our exposure to interest rate risk, during fiscal 2006, we entered into a one year interest rate cap agreement for a notional amount of $100 million designed to offset our risk in the event that LIBOR exceeds 6.3% per annum. While our subordinated notes are fixed interest-rate debt obligations, fluctuating interest rates could result in material changes to the fair values of the embedded derivatives in our IDSs.

Market risk – Changing market conditions that influence stock prices could have an impact on the value of our liability for derivatives. As of July 3, 2007, a charge of $0.1 million has been recorded to our consolidated statement of operations to record changes in the fair value of our derivatives. A $1.00 fluctuation in the price of our IDS units would result in an approximate $0.3 million to $0.4 million change in our liability for derivatives.

As of July 3, 2007, there have been no material changes, except as discussed above, in the quantitative and qualitative disclosures about market risk from the information presented in our Form 10-K for the year ended January 2, 2007.

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Item 4. Controls and Procedures.

Evaluation of disclosure controls and procedures.

We maintain disclosure controls and procedures designed to ensure that information required to be disclosed in our reports under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. Our management, with the participation of the Chief Executive Officer and the Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of July 3, 2007. Based upon that evaluation and subject to the foregoing, our Chief Executive Officer and Chief Financial Officer concluded that the design and operation of our disclosure controls and procedures provided reasonable assurance that the disclosure controls and procedures are effective to accomplish their objectives.

During the period covered by this report there have been no changes in our internal control over financial reporting that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

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PART II OTHER INFORMATION

Item 1. – Legal Proceedings

See Note 3 in the Notes to the Consolidated Condensed Financial Statements.

Item 1A. – Risk Factors

There has been no material change to the disclosure in our Annual Report on Form 10-K for the fiscal year ended January 2, 2007; however, the following risk factor should be considered in addition to the risk factors included in the Annual Report.

Future strategic transactions, such as acquisitions or joint ventures, may require significant resources or result in significant and unanticipated losses, costs or liabilities.

In the course of our business, we continuously explore and evaluate opportunities to partner creatively with other companies in order to enhance our existing operating platforms, achieve operational efficiencies or expand our product offerings. We may seek to grow through strategic partnerships or other transactions, including acquisitions, which may be material. We may have difficulty financing any acquisition as a result of our capital structure. If we incur additional indebtedness to finance an acquisition, it could reduce our access to capital for other purposes and increase our debt service costs.

Future strategic transactions, such as acquisitions or joint ventures, could entail a number of other risks, including, without limitation, difficulties in integrating operations, unfamiliarity with new areas of business, increased operating costs, exposure to unanticipated liabilities, regulatory risks and diversion of management’s attention from operating our business.

Item 4. – Submission of Matters to a Vote of Securities Holders

The 2007 Annual Meeting of Security Holders was held on May 23, 2007. At the meeting seven directors of the Company were elected and our security holders ratified the appointment of Deloitte & Touche LLP as our independent registered accounting firm for the fiscal year ending January 3, 2008.

1. The security holders elected the following directors to serve until the next annual meeting of security holders or until their successors are duly elected and qualified:

Name of Director	Number of Shares Voted For		Number of Shares Withheld
David M. Williams		19,879,354		177,088
Janet L. Steinmayer		19,907,718		148,724
Felix P. Chee		19,914,504		141,938
Sue Ling Gin		19,903,693		152,749
Alfred Poe		19,913,092		143,350
Peter F. Wallace		19,904,211		152,231
Glenn R. Zander		19,908,862		147,580

2. The security holders ratified the appointment of Deloitte & Touche LLP:

Number of Shares Voted For		Number of Shares Withheld		Number of shares Abstained
19,936,304		72,307		47,831

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Item 6. Exhibits

(a)	Exhibits:
	31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes- Oxley Act of 2002.
	31.2	Certification of Interim Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	32.1	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	32.2	Certification of Interim Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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SIGNATURES

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, on August 13, 2007.

Centerplate, Inc. By: /s/ Kevin F. McNamara Name: Kevin F. McNamara Title: Chief Financial Officer

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