Evans & Sutherland Computer (ESCC)

In the normal course of business, we become involved in various legal proceedings.  Although the final outcome of such proceedings cannot be predicted, we believe the ultimate disposition of any such proceedings will not have a material adverse effect on our consolidated financial condition, liquidity, or results of operations.

ITEM 3.          LEGAL PROCEEDINGS

In the normal course of business, we may have various legal claims and other contingent matters.  We know of no legal claims or other contingent matters outstanding that would have a material adverse effect on our consolidated financial condition, liquidity or results of operations.

ITEM 3.          LEGAL PROCEEDINGS

In the normal course of business, we may have various legal claims and other contingent matters.  We know of no legal claims or other contingent matters outstanding that would have a material adverse effect on our consolidated financial condition, liquidity or results of operations.

ITEM 3.          LEGAL PROCEEDINGS

In the normal
course of business, we may have various legal claims and other contingent matters.  We know of no legal claims or other
contingent matters outstanding that would have a material adverse effect on our
consolidated financial condition, liquidity or results of operations.

ITEM 3.          LEGAL PROCEEDINGS

In the normal
course of business, we may have various legal claims and other contingent matters.  We know of no legal claims or other
contingent matters outstanding that would have a material adverse effect on our
consolidated financial condition, liquidity or results of operations.

In the normal course of business, we become involved in various legal proceedings.  Although the final outcome of such proceedings cannot be predicted, we believe the ultimate disposition of any such proceedings will not have a material adverse effect on our consolidated financial condition, liquidity, or results of operations.

In the normal course of business, we become involved in various legal proceedings.  Although the final outcome of such proceedings cannot be predicted, we believe the ultimate disposition of any such proceedings will not have a material adverse effect on our consolidated financial condition, liquidity, or results of operations.

In the normal course of business, we become involved in various legal proceedings.  Although the final outcome of such proceedings cannot be predicted, we believe the ultimate disposition of any such proceedings will not have a material adverse effect on our consolidated financial condition, liquidity, or results of operations.

ITEM 3.    LEGAL PROCEEDINGS

        On October 18, 2007 we filed a breach of contract action (the "Complaint") in Federal District Court in Salt Lake City, Utah against a company (the "Defendant") which we had engaged to provide certain intellectual property rights and product development services under a Development and Cross License Agreement (the "Agreement"). On October 9, 2007, the Defendant delivered a letter alleging that we breached the Agreement for failure to pay a $400 minimum royalty in accordance with the terms of the Agreement, and that the alleged breach was cause for termination of the Agreement. The Defendant was never formally served with the Complaint. In January 2008 we settled the matter when both parties agreed to terminate the Agreement and enter into a new research and development agreement.

        In the normal course of business, we may have various legal claims and other contingent matters. We know of no legal claims or other contingent matters outstanding that would have a material adverse effect on our consolidated financial condition, liquidity or results of operations. No other material legal proceedings terminated during the fourth quarter of fiscal year 2007.

ITEM 3.    LEGAL PROCEEDINGS

        On October 18, 2007 we filed a breach of contract action (the "Complaint") in Federal District Court in Salt Lake City, Utah against a company (the
"Defendant") which we had engaged to provide certain intellectual property rights and product development services under a Development and Cross License Agreement (the "Agreement"). On
October 9, 2007, the Defendant delivered a letter alleging that we breached the Agreement for failure to pay a $400 minimum royalty in accordance with the terms of the Agreement, and that the
alleged breach was cause for termination of the Agreement. The Defendant was never formally served with the Complaint. In January 2008 we settled the matter when both parties agreed to terminate the
Agreement and enter into a new research and development agreement.

        In
the normal course of business, we may have various legal claims and other contingent matters. We know of no legal claims or other contingent matters outstanding that would have a
material adverse effect on our consolidated financial condition, liquidity or results of operations. No other material legal proceedings terminated during the fourth quarter of fiscal year 2007.

On October 18, 2007 we filed a breach of contract action (the “Complaint”) in Federal District Court in Salt Lake City, Utah against a company (the “Defendant”) which we had engaged to provide certain intellectual property rights and product development services under a Development and Cross License Agreement (the “Agreement”). On October 9, 2007, the Defendant delivered a letter alleging that we breached the Agreement for failure to pay a $400 minimum royalty in accordance with the terms of the Agreement, and that the alleged breach was cause for termination of the Agreement.  We believe that the Defendant’s notice of termination of the Agreement fails to discharge the Defendant of its obligations to perform services and provide the intellectual property rights which we have paid for under the Agreement. The Complaint seeks to enforce performance obligations of the Defendant and demands payment for damages resulting from the Defendant’s failure to perform in accordance with the terms of the Agreement.  The Defendant has not been formally served with the Complaint and we are currently in discussions to resolve this dispute without litigation.

In the normal course of business, we become involved in various legal proceedings.  Although the final outcome of such proceedings cannot be predicted, we believe the ultimate disposition of any such proceedings will not have a material adverse effect on our consolidated financial condition, liquidity, or results of operations.

In the normal course of business, we have various other legal claims and other contingent matters.  Although the final outcome of such matters cannot be predicted, we believe the ultimate disposition of any such matters will not have a material adverse effect on our consolidated financial condition, liquidity, or results of operations.

Note 11—Legal Proceedings

In December 2005, we settled a lawsuit previously filed by the Company against an insurance company with respect to an insurance claim made by the Company for losses incurred due to the cancellation of a significant contract by a customer. Under the terms of the settlement, the Company received a payment of $8,000 and agreed to dismiss the lawsuit and to provide a release of claims against the insurance company. The insurance settlement proceeds of $8,000 were recorded as gain on insurance settlement and included with the loss from discontinued operations for the year ended December 31, 2005.

In the normal course of business, we may have various legal claims and other contingent matters. Although the final outcome of such matters cannot be predicted, we believe the ultimate disposition of these matters will not have a material adverse effect on our consolidated financial condition, liquidity or results of operations.

In the normal course of business, we have various other legal claims and other contingent matters.  Although the final outcome of such matters cannot be predicted, we believe the ultimate disposition of any such matters will not have a material adverse effect on our consolidated financial condition, liquidity, or results of operations.

Note 16:  Legal Proceedings

In December 2005, we settled a lawsuit previously filed by E&S against an insurance company with respect to an insurance claim made by E&S for losses incurred due to the cancellation of a significant contract by a customer. Under the terms of the settlement, E&S received a payment of $8,000 and agreed to dismiss the lawsuit and to provide a release of claims against the insurance company. The insurance settlement proceeds of $8,000 were recorded as gain on insurance settlement as a separate component of operating income for the year ended December 31, 2005.

In March 2004, through mediation, we settled a claim initiated against us in May 2003 by RealVision, Inc. relative to matters arising from the sale of a business unit to RealVision, Inc. in 2001. Under the agreement reached, RealVision received a settlement of approximately $2,425. We paid approximately $850 of the settlement and our insurance carrier paid the remainder.

In the normal course of business, we may have various legal claims and other contingent matters. Although the final outcome of such matters cannot be predicted, we believe the ultimate disposition of these matters will not have a material adverse effect on our consolidated financial condition, liquidity or results of operations.

Item 1.           LEGAL PROCEEDINGS

In the normal course of business, we have various other legal claims and other contingent matters.  Although the final outcome of such matters cannot be predicted, we believe the ultimate disposition of these matters will not have a material adverse effect on our consolidated financial condition, liquidity, or results of operations.

In March 2004, through mediation, we settled a claim initiated against us in May 2003 by RealVision, Inc. relative to matters arising from the sale of a business unit to RealVision, Inc. in 2001. Under the agreement reached, RealVision received a settlement of approximately $2,425. We paid approximately $850 of the settlement and our insurance carrier paid the remainder.

In the normal course of business, we may have various legal claims and other contingent matters. Although the final outcome of such matters cannot be predicted, we believe the ultimate disposition of these matters will not have a material adverse effect on our consolidated financial condition, liquidity or results of operations.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)