order NO. 25304 ~1 roval to aware b~rolition NAp1ai't Inc, for ~ of ~~tion Facilities use 2nd Floor Kerr County ~°~o i Anne April 30, 1998 Vol V Page 631 1 V` i 1 1 1 1 l ORDER ND. E5304 RF'F'ROVRL TO AWRRD RID TO MRRT INC. FOR THE DEMOLITION OF DETENTION FRCILITIES, AND FLOOR i{ERR CDUNTY COURTHOUSE RNNEX Dn this day the 30th day of Rpr^i 1, 1998 i_ipon motion made by Commissioner Let z, seconded by Commissioner- Oehler, the Co~ar^t unanimously approved by a vote of 5-Q~-0, to awar^d bid to Mart Inc. for ~7.84,SD7.OS for^ the demolition of Detention Facilities,~nd Floor^ F;err^ Co~_tnty Co~ar•tho~ase Rnnex. ARCHITEi` DATE: April 29, 1998 TO: The Honorable Jonathan Letz Commissioner Precinct 3 Kerr County Commissioner's Court RE: Kerr County Courthouse Second Floor Annex -Demolition of Previous Detention Facilities OUR PROJECT: KC2 TRANSMITTED: [X] herewith [ ] in accordance with your request [ ]under sepazate cover via FOR YOUR: [ ]approval [ ]distribution [X] information [ ]record [ ]review & comment [X] use [ ]other THE FOLLOWING: [ ]drawings [ ]submittals [ ]samples [ ]specifications [ ]directives [X] other COPIES DATE DESCRIPTION ACTION 1 6-30-97 Robles & Sons financial statement D 1 3-31-97 Mazt, Inc. company information and financial statement D Action: A. Action indicated on item; B. No action required; C. For signature; D. See REMARKS REMARKS: The attached financial statements aze for County's review as we aze not experts in this area. COPIES TO: [ ]Owner [ ]Contractor [ ]Consultant [ ]Field [] i'~ZICi-~~,;T az -L ~V~~~ __~ tile:kc2[[ans.002 Firm Information: Name of Firm: Address of Principal Office: Phone: ` Form of Business Organization: Year Founded: Primary individual to contract: Mart, Inc. 1503 Perry Road Irving, TX 75060 Office: (972) 721-1522: (800) 627-1522 Fax: (972) 721-1660 Coporation, Incorporated 1977 1977 Vernon R. Proctor, President Organization: 2.1 Mart, Inc. has been a Commercial General Contracting Firm for 22 years. 2.2 Mart, Inc. has been under its present name for 21 years and has never had a former name. 2.3 Mart, Inc. was incorporated April 1, 2977 in the State of Texas. The Officers of the corporation are as follows: Vernon R. Proctor, President and Treasurer Linda G. Proctor, Vice President and Secretary Tim Proctor, Vice President of Operations Larry Gabel, Vice President handling Austin Area Operations 2.4.2.6 NfA 2.7 No Owner or Management Staff of Mart, Inc. has been convicted of a Felony. Licensing: 3.1 Mart, Inc. is legally qualifed to do General Construction in the State of Texas. Vernon R. Proctor is licensed in the State of Texas for Air Conditioning and Refrigeration Contracting. License Number TACLA002506C 3.2 N/A Experience: 4.1 Mart, Inc. is capable of performing the following categories of work with it's own forces: Site Work: site demolition, excavation, site concrete Concrete: concrete demolition, concrete formwork, concrete placement Wood and Plastics: rough carpentry, carpentry framing, finish carpentry Finishes: drywall, ceiling, insulation, tape, bed, texture, paint Metal Building: metal building structure, welding 4.2 Mart, Inc. has no ownership in any subcontractor firms. Nor does any oT Mart, Inc.'s Drincipals have ownership or stock in any subwntractor firm. 4.3 Claims and suites. 4.3.1 Mart, Inc. has never failed to complete any work awarded to it. 4.3.2 Mart, Inc. has no judgments, claims, arbitration proceedings or suits pending or outstanding against it's organization of offcers at this time. 4.3.3 Mart, Inc. has requested arbitration with regard to a subcontract within the last year. This matter has been settled. 4.4 No officer or principal of Mart, Inc. has been an officer or principal of another organization that failed to complete a construction contract. T 4.5 Current Work in progress for Mart, Inc. has been listed on a separate reference sheet. This reference sheet has been marked Exhibit "A"and attached to this proposal. 4.6 Major projects completed by Mart, Inc. over the last five years are listed on a separate reference sheet. This reference sheet has been marked Exhibit "B" and attached to this proposal. Financial Information: 5.1 Mart, Inc.'s reviewed financial statement of year ending 3/31/97 has been marked Exhibit "C" and attached to this proposal. Mart, Inc. is currently working on it's 3131/98 year ending. The reviewed statement is not ready at this time for submittal. Mart, Inc.'s in-house statement for February 1997 has been marked Exhibit "D" and attached to this proposal. 6.2 Mart. Inc.'s reviewed financial statements are prepared by the following firm. Perryman, Brehm & Assoc LLP 6390 LBJ Freeway, Suite #106 Dallas, TX 75240 Mr. Bob Perryman (972) 702-8200 6.3 The attached financial statement is for the identical organization named under item 1 above. 5.4 Mart, Inc. will act as guarantor of the contract for construction. 5.6 Mart, Inc.'s banking relationship is with the following bank and bank officer: Bank of the West 950 N. Beltline Irving, TX 75060 Mr. Ken Yancey (972) 986-2222 6.6 Mart, Inc.'s bonding agent is the following: McOueary, Henry Bowles, Troy 12700 Park Central Dr., Suite 1700 Dallas, TX 75251 Mr. Tom Ellis (972) 770-1672 Mart, Inc.'s bonding company is the following: Insurance Company of the West 10140 Campus Point Dr. San Diego, CA 92121-1520 Change Orders for Past Work: 6.1 A list of the Past Work Change Orders has been marked Exhibit "F" and attached to this proposal. Personnel: President: Vernon R. Proctor Project Manager: Larry Gabel Estimator: Larry Gabel Superintendent: Not Assigned Yet Tim Proctor: Vice President of Operations Mart, Inc. has established an account with Avert, Inc. who can provide a curtent Felony Conviction Cert~cate for Principal and Key personnel. 2 MART, INC. CURRENT WORK IN PROGRESS Exhibit'A' 4/10/98 NAME OF PROJECT LOCATION OF PROJECT OWNER ARCHITECT CONTRACT PERCENT 5 HEOULED fAMPLETON AMOUT CO T MPLE E OA7E Kooped I5p Gymnasmm 8 Classroom Kopper) 150 Kopper) ISD Lintla Bnahean Aoditan Preargmeereda Slnxare 101 51h Sveet 101 Slh SVeet Marta ArN4eGa and Erection KeppM, T% 76652 Kpppen. TX 76652 ~ 2027 SouN 61 at SUaet. Suib tOB 124.876 ~ 95% ' OM7558 TsmpN. TX 76504 (254>778-1133 ~ ' YMCA Irving YMCA Irving YMCA of Metropolaan Oallaa Wfillunm B. WaDactier Remodel of (auliry antl 8aseoall Fiek1 2200 W Irvng fihd 601 N. Akard Street H1o Nrn4scn ~ ' Irving, X 75061 Dillaa. TX 75201 BOO W. AvpoH Freeway, Suite 1001 498.491 99% 04/1558 Irnrg, TX 75062 (972) 438<380 Ciy of Raclwall Cary of RaUwall City of Rockwall Hendricks-Hraaner ArUtaeo Serviu Canter 205 W Rusk 205 W Rusk 102 E. Rusk, Rockwall. TX 75087 Rockwall. TX 75087 RoGwall, TX 75067 (972)771-4888 268.592 ~I~ 95% 04lJO58 City of Rockwall Ciy of Rockwell Ciry a Rockwall Ron HoDDa Aroh4aaa Animal Center 205 W Rush 205 W Rusk ', 814 Weat Man SDea. %200 i I Rachvall, TX 75088 Rockwell. TX 75088 '~, (idflaM, TX 75010 ' 91,575 ~ 88 % ~ 04(J058 1972)494-0174 l i i Keller Middle SUtool Phase II Keller Middle School Keller hMepentlent SUrtool Oise 8yrort Fclae Aaaoaarea. Ina Classroom Finish out 328 Lonna 308 Lonnie SVeet '~ 2275 Weal Park DWrt SuBa 200 ~' ~ , ', Keller. T% 76248 Keller, TX 76248 Eubaa, T% 76010 ~I ' 710.463 99% MlJ058 ' ~ (817)431-1129 I Dallas Independent Scnool Oislnct ~ $epuayan. Carver, Earhan, Colonial, Dallas IndepmdeM SUtool Dist Johmon84cKlDben ArMiteda. Inc Renovations to Sequoyah. Carver, James. Robena. White, Mersalea, 3700 Ross Ave. I 985 $loasn Streal '. Eamart. Cobnul. James. Roberta. ~ Tumor Leameig Gainers !Dallas, TX 75225 Dallm, T% 75207 681 455 I 89% ~ OSH558 Write. Marsaba. Turner Learning (2141745-7070 , , I Centers-Bid Package+U19 ', i I i I I, Oemson Hiyh $Upol Renovalans I ~ Damson High School Demsan Indpentlent School Din JPJ ArrlliteW. Inc i Adtlnions -Phase 2 ~, 1901 S. Mlrick Averwe '.1201 $ouN Rusk 5910 N. Cenbal Ezpresswey, x1200 ' ' ' Oemson, 7X 15020 pennon. TX 75020 I pews. TX 75206 ~' 1,219.699 ~' 37% 07lJ0/98 i (214) 987A000 MaraMw High Sofmall Feld MdpaMUr Hlgh Sdtpol ,Irving IntlepeMam $MOOI D'ot Irvng Intlependrxa $fY1001 Din ~ i '~, 3700 N. Maranhur 1902 N. O'COnna Road 902 N. O'COnna Road ~ I ~ Irvng, TX 75062 ,Irving, TX 75061 ~ Irving. 7% 75W2 ~ 115.616 53% 045056 (972127343034 ~ I Sherwin Williams Metal BuAdin9 SDerwm Williams Sherwin Wlliama ~ WA ~ ' 234 N. Nursery 234 N. Nursery ' i Irvng, TX 75060 Irving, T% 75W t ' ~~ 10,349 ~ 75% j 01/3058 '(97214365264 i r ~I i Cesar H41 lntlepergem Smoot Dist Cedar Hill IrMependem 6ctwol Dial Cedar Hip Independen $(dlWl OiaL Dikita Englneenrp ~ '. , Swine Ham Faulitiea l Swore Bam Feulitiea 1270 South HigTVay 67 1420 Wetl Mockagbatl Lane, eG00 l ~ 'i 1440 W. Hepline ,Cedar HIII, T% 75704 I Oawa, TX 75247 131 504 ~ 9% O6I3D58 ' Cedar Hill, TX 75104 ~ (2141634-eBM ~ I . , i Gordon Speuallies Office Remodel Gordon Speua4lea ~GOrdon Speaaltbs WA i 720 W WMergrem Road J20 W Wimergrsen Road I i , Irving, X 75141 ~lHUtmim TX 75111 ~ , fi3.058 33% 0.L155B ~ i '(214J 225-1660 l ~ II ~ Irving High School AO7C 8wlding ~ Irving Hgh $mtlpl ' IMng Intlel%ndMt Stlad Diet i Cagan Afaaaalea. Ira. I i She118uiWing Ony '~ 900 O'COnna '902 N. O'Canna Raatl 501 Eon Strset Su4a 500 ' Irvn9. TX 75061 .Irving, TX 75061 i Dallas, TX 75202 ' 91,000 O% l~ 06130198 (214) 748-2000 MART, INC. Table of Contenu Accountant's Review Report Financial Statements: Balance Sheets Statemenu of Operations and Retained Earnings Statemenu of Cash Flows Notes to Financial Statemenu Pa˘e 1 2 3 4 5-10 ACCOUNT'ANT'S REVIEW REPORT Stockholders and Board of Dtrectors Mart, Inc. Irving, Texas 3SSOCIATES, L.L.P. PUBLIC ACCOUNTANTS We have reviewed the accompanying balance sheets of Mart, Inc. as of March 31, 1997 and 1996, and the related statements of operations and retained earnings and cash flows for the years then ended in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. All information included in these financial statements is the representation of Mart, Inc. A review consists principally of inquiries of Company personnel and analytical procedures applied to financial data. It is subsequenlly less in scope than as audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements in order for them to be in conformity with generally accepted accounting principles. .~...~,....,.-, l -1~,_. Qom,,,,, d- ~`~'~`° i ~ cis- iF' June 11, 1997 c_90 LBJ FREEWAY, StiITE 106 • DALLAS, TEXAS 75240 • (972) 702-8200 • FAX (972} 702-8223 Liabilities and Stockholder's Equity Current liabilities: Notes payable (Note 4) Accounts payable, trade (Note 3) Accrued liabilities - Income taz payable (Note 6) Billings in excess of costs and estimated earnings on contracts (Note 1) Current maturities of long-term debt (Note 4) Total current liabilities Long-term debt (Note 4) Stockholder's equity: Common stock; 100,000 shares authorized at $1 par value; 10,000 shares issued and outstanding Additional paid-in capital Retained earnings 1997 1996 $ 51,134 $ 76,748 620,751 267,553 7,909 10,875 6,618 3,475 124,747 27,628 188.733 10.824 999,892 397.103 181.324 10,000 97,422 86.590 194.012 189.386 10,000 97,422 14,108 121,530 $ 1.375.228 $ 708.019 -2- 1996 Revenue Earned Job Costs Gross Profit $ 2,838,805 $ 2,482,377 $ 356,428 1.125.846 1.001.186 124,660 $ 3.964.651 $ 3.483.563 481,088 440,552 18.683 459,235 21,853 290 (15.193) (14,9031 6, 950 3.267 3,683 10.425 $ 14.108 -3- MART, INC. Statements of Cash Flows For the Years Ended March 31, 1997 and 1996 Cash flows from operating activities: Net income Adjustments to reconcile net income to net cash used in operating activities: Depreciation (Increase) decrease in receivables (Increase) decrease in cosu and estimated earnings in excess of billings on uncompleted contracts Decrease (increase) in prepaid expenses Decrease (increase). in deferred income tax benefit Decrease in deposits Increase (decrease} in accounts payable (Decrease) increase in accrued liabilities Increase in billings in excess on costs and estimated earnings on uncompleted contracts Increase in income tax payable Total adjustments Net cash used in operating activities Cash flows from investing activities: Investment in real estate Purchases of property and equipment Cash flows from financing activities: Proceeds from borrowings Principal payments on debt Net cash provided by frn,wcing activities (Decrease) increase in cash and cash equivalents Cash, beginning of year 1997 1996 $ 72.482 $ 3.683 40,865 18,683 (438,757) 11,179 _(156,371) 18,230 7,426 (7,406) 5,401 (1,661) - 1,000 353,198 (68,760) (2,966) 1,739 97,119 16,883 3.143 4.567 (90.9421 15.5461 (18.460) (1.863) (58,800) - (96.183) (25.5431 (154,983) (25,5431 263,549 142,879 (119.3151 (98.5761 144.234 44.303 (29,209) 16,897 44.062 27.165 Cash, end of year $ 14.853 $ 44.062 See accountant's review report. The accompanying notes are an integral part of the financial statements. -4- - MART, INC. Notes to Financial Statements March 31, 1997 and 1996 Noce 1 -Summary of Sienificant Accounting Policies The Company is engaged in a single industry: the construction of industrial and commercial buildings primarily in the North Texas area. The work is performed under cost-plus-fee contracts and fixed-price contracts. The length of the Company's contracts caries, but is typically about six months. Management uses estimates and assumptions in preparing these _fmancial statements. in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of asseu and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could vary from the estimates that were used. Recognition of income and costs on construction contracts The Company uses the percentage-of-completion method of reporting profits on major construction contracts. Under this method, the percentage of the cost incurred to date to the total estimated costs is used to determine the portion of the contract amount which is considered earned to date. At the time a loss on a contract becomes known, the full amount of the projected loss is recognized. Contract costs include all dtrect material and labor costs and those indirect costs related to contract performance, such as induect labor, supplies, tools, repairs and depreciation. Selling, general and adtninistrarive costs are charged to expense as incurred. On contracts where costs and estimated earnings are in excess of billings, the excess is treated as a current asset. Where billings are in excess of costs and. estimated earnings, this excess is shown as a current liability. These amounts are as follows at March 31: Costs and estimated earnings on contracts not fully billed Billings on contracts See accountant's review report. 1997 1996 $ 5,023,027 $ 1,843,151 4.842.790 1.722.166 $ 180,237 $ 120,985 -5- . MART, INC. Notes to Fitianciat Statements Mazch 31, 1997 and 1996 Note 1 - Surnmarv of Sienificant Accountine Policies (Continued) Recognition of income and costs on construction contracts (Continued) These amounts are reflected in the accompanying financial statements as follows at March 31: Current assets Current Iiabiliry Inventory 1997 1996 $ 304,984 $ 145,613 124.747 27.628 $ 180.237 $ 120.985 Inventory consists of goods received in settlement of contract receivables. Items are valued at market value and held for future trading. Property and equinment Property and equipment are stated at cost and depreciated over estimated useful lives ranging from three to nineteen yeazs using straight-line and accelerated methods equivalent to those being used for income tax reporting purposes. Maintenance and repairs aze chazged against earnings when incurred. Major renewals and additions aze capitalized. Statements of cash flows Fot purposes of the statements of cash flows, the Company considers all highly liquid instruments purchased with a tnaturiry of three months or less to be cash equivalents. The Company paid $51,444 and $9,331 of interest on its debts for the years ended March 31, 1997 and 1996, respectively. The Company paid $7,109 and $361 in income taxes for the yeazs ended March 31, 1997 and 1996, respectively. Investment in real estate Investment in real estate consists of a residential house which is under contract to sell to an employee of the Company. The property is pledged against a bank loan (see Note 4) which was obtained to finance the purchase and improvements. See accountant's review report. -6- MART, INC. Notes to Financial Statements March 31, 1997 and 1996 Note 2 -Contract Receivables Contract receivables are as follows as of March 31: Contracts, current Retainage Contracts, noncurrent 1997 1996 $ 612,596 $ 212,612 238.090 90.312 $ 850.686 $ 302.924 $ 8.975 $ 64.128 Based upon the Company's experience, management does not consider an allowance for doubtful accounts to be necessary at March 31, 1997 or 1996. Noncurrent receivables represent billings on contracts which the Company anticipates collecting over an extended period of time. Included in contracts receivable is $115,970 due from an employee for construction of his personal residence. This receivable was repaid on April 29, 1997, by the employee assuming a related note payable (see Note 4). Also included in contracts receivable is $38,812 due from an affiliate which provides labor services to the Company. Note 3 -Accounts Pavabie Accounts payable include $116,965 and $38,763 due to subcontractors at March 31, 1997 and 1996, respectively, which have been retained pending completion and customer acceptance of jobs. Note 4 - Long-terns Debt and Notes Pavabie Long-term debt consists of the following at March 31: 1997 1996 Due credit union, payable monthly $683 including interest at 6.75 % ; secured by vehicle $ - $ 6,622 See accountant's review repon. -7- MART, INC. Notes to Financial Statements March 31, 1997 and 1996 Note 4 - L-Oa$-term Debt and Notes Payable (Continued) Due bank, payable monthly $1,068 including interest at 10.75po; secured by equipment 34,940 - Due life insurance company, payable quarterly $1,382 including interest at 6.7%; secured by stockholder's annuity 17,114 21,316 Due bank, $150,000 construction loan due April 30, 1997, including interest at 9.5 %; secured by real estate contract with Company employee and stockholder guaranty. This note was assumed by the employee on April 29, 1997, however the Company remains contingently liable on the note until the employee can obtain a permanent mortgage on the property 115,970 - Due bank, construction loan; secured by teal estate under contract with Company employee (Note 1) 58,800 - Due stockholder, due March 31, 1998, including interest accrued at 4.5%; unsecured, subordinated for bonding purposes 143.233 172.272 370,057 200,210 Less current maturities 188.733 10.824 $ 181.324 $ 189.386 Future maturities of long-term debt are as follows: Year Ending March 31: 1998 $ 188,733 1999 158,590 2000 16,898 2001 5,836 See accountant's review report. -8- MART, INC. Notes to Financial Statements Mazch 31, 1997 and 1996 Note 4 -Lone-term Debt and Note Payable (Continued) Notes payable consist of the following at Mazch 31: Due bank, due May 17, 1997, interest at 11 %; secured by cash, contract receivables and stockholder's guarantee 1997 1996 $ 17;687 $ 21,000 25,000 Due bank, due April 17, 1997, interest at 10.75 secured by cash, contract receivables and stockholder's guarantee Due insurance companies, payable $4,328 per month including interest at 8 %; secured by unexpired premiums Note 5 -Lease 30,000 12.447 21.748 $ 51.134 $ 76.748 The Company was obligated under a lease agreement with its stockholder for office space at a rate of $1,400 per month. The lease expired in December, 1996, at which point the lease began on a month-to-month basis at the Company's option. Rent expenses amounted to $16,200 and $9,500 for the yeazs ended March 31, 1997 and 1996, respectively, and is included in the general and administrative expenses on the statements of operations and retained earnings. Note 6 -Provision for Income Tazes Deferred income taxes are provided on the timing difference between financial statement and income tax reporting. At March 31, 1997 and 1996, timing differences result from the Company's accrual of interest payable to a stockholder which are not deductible for income tax purposes until paid. No valuation atIowance is considered necessary on the deferred tax asset. See accountant's review report. -9- MART, INC. Notes to Financial Statemenu " .March 31, 1997 and 1996 Note 6 -Provisions for Income Taxes (Continued) The provision for income taxes (benefit) consists of the following for the years ended March 31: 1997 1996 Current federal income tax Deferred federal income tax (benefit) Note 7 - Backloe $ 10,252 $ 4,928 5.401 (1.661) $ 15.653 $ 3.267 The following schedule shows a reconciliation of backlog representing signed contracts in existence at March 3I, 1997: Balance, beginning of year New contracts and adjustments Less contract revenue earned Balance, end of year $ 566,494 7.717.335 8,283,829 6.667.227 $ 1.616.602 The Company has been awarded contracts amounting to $2,126,985 from April 1, 1997 to June il, 1997. See accountant's review report. -10- RUN E: 04/70/98 MART, INC, BALANCE SHEET FOR YEAR ENDING 03/31/98 for the Period Ending 03/05/98 ASSETS CURRENT ASSETS 120 CASH IN BANK-BANK NEST 117307.71 121 CASH IN BANK-PETTY CASH 2705.20 122 CASH IN BANK-1ST NATIONA 0.00 130 TRAVEL CASH ACCOUNT 754.86 131 ACCOUNTS RECEIVABLE 1034573.12 132 ACCOUNTS REC NSF 4832.47 171 EARNED REVENUE UNBILLED 170055.99 139 NOTE REC. - L. GABEL 0.00 141 NOTE RECEIVABLE-C NOODS 0.00 143 ADVANCES TO EMPLOYEES 2465.77 150 PRIMENET TRADE 0.00 151 ITEX TRADE 6959.61 152 TRADE EXCHANGE INC. 0.00 153 TRADE USA 9086.43 154 KTLR/K JONES - TRADE 4143.00 155 TRADE 0.00 179 PREPAID INCOME TAXES 72888.00 181 PREPAID INSURANCE 10881.33 190 BARTER INVENTORY 3730.00 TOTAL CURRENT ASSETS FIXED ASSETS 211 FURNITURE 8 EQUIPMENT 238382.58 213 AUTOMOTIVE EDUI PMENT 109911.93 215 911 N SIXTH STREET 0.00 216 FT NORTH PROPERTY 0.00 221 ACCUMULATED DEPRECIATION -216060.56 NET FIXED ASSETS OTHER ASSETS 251 UTI Lf TY DEPOSITS 0.00 252 PLAN DEPOSITS 3650.00 253 SECURITY BOND DEPOSIT 0.00 254 PROPERTY DEPOSIT FT NORT 2000.00 TOTAL OTHER ASSETS PAGE 1 1380383.49 132233.95 5650.00 Exhibit "D" TOTAL ASSETS 1518267.44 04/10/98 MART, INC, BALANCE SHEET FOR YEAR ENDING 03/31/98 for the Period Ending 03/05/98 IIABILITJES 8 EQUITY PAGE 2 CURRENT LIABILITIES 331 ACCWNTS PAYABLE 735367.05 331 ACCOUNTS PAY RETAINAGE 200105.86 33Z SUB INSURANCE PAYABLE 0.00 340 BILLINGS EXCESS OF EARN 107768,94 341 PAYROLL TA%ES PAYABLE 449.91 342 PAYROLL DEDUCTS PAYABLE -145.00 343 PRE PAID LEGAL 20.70 344 SIMPLE IRA PLAN 991.00 345 SALES TAX PAYABLE 5207.23 351 FED INCOME TAX PAYABLE 0.00 439 NOTE PAYABLE - B/N-STONE 500.00 441 NOTE PAYABLE - B/W-DI%ON 0.00 440 NOTE PAYABLE - BANK/REST 71000.00 361 INTEREST PAYABLE - SHARE 11794.20 430 CURRENT PORTION LT DEBT 0,00 TOTAL CURRENT LIABILITIES 1133059.89 OTHER LIABSLITES 442 NOTE PAYABLE - GREAT AM 14897,57 445 NOTE PAYABLE - 93 FORD 0,00 446 ROTE PAYABLE - LIFT 26045,81 47 NOTE PAYABLE - COPIER 6870,23 450 NOTE PAYABLE - EL BE G/L 0.00 455 NOTE PAYABLE - Y,L. 0,00 460 NOTE PAYABLE - COMMERICI 0.00 496 NOTE PAYABLE-SHAREHOLDER 130267,36 499 CURRENT PORTION LT DEBT 0,00 TOTAL OTHER LIABILITIES 178080.97 TOTAL LIABILITES 1311140.86 SHAREHOLDER'S EQUITY 521 COMMON STOCK (1,000 SH) 10000.00 525 ADDITIONAL PD-IN CAPITAL 97421.92 531 RETAINED EARNINGS 86589.53 597 NE7 INCOME OR LOSS (1) 13115.13 TOTAL SHAREHOLDER'S 207126.58 TOTAL LIABILITIES 8 EOUIT 1518267.44 04;70/98 MART, INC, PAGE 1 STATEMENT OF INCOME FOR YEAR ENDING 03/31/98 for the Period 02/06/98 - 03/05/98 CURRENT X YEAR-TO-DATE X INCCME 671 EARNED REVENUE GILLED 499347.63 86.8 6784811.05 102.5 645 EARNED REVENUE UNBILLED 214120.53 37.2 777412.40 11.7 665 LA57 MONTH EARNED REVENUE -737923.82 -24.0 -945674.35 -14.3 • 70TAL INCOME 575538.34 100.0 6676549.10 100.0 COST OF SALES 651 DIRECT LABOR 9875.00 1.7 116859.29 1.8 652 EQUIPMENT RENTAL 8014.63 1.4 100607.66 1.5 653 SUB CONTRACT EXPENSE 399975.27 69.5 4565982.07 69.0 654 DISCOUNT 0.00 0.0 -216.13 0.0 655 MATERIAL COST 104968.46 18.2 1112273.24 16.8 657 FREIGHT 0.00 0.0 21.38 0.0 667 OTHER JOB COSTS 71488.44 2.0 153975.49 2.3 670 LABOR BURDEN 1975.00 0.3 19302.51 0.3 • TOTAL COST OF SALES 536296.80 93.2 6068805.51 91.7 • GROSS PROFIT 39241.54 6.8 547743.59 8.3 GENERAL 8 ADMIN EXPENSE 701 OFFICERS SALARIES 4000.00 0.7 52270,27 0.8 703 OTHER SALARIES 15678.00 2.7 173600.85 2.6 705 GENERAL SUPPLIES 2.54 0.0 766.13 0.0 707 RENT EXPENSE -7200.00 -1.3 12600.00 0.2 OS BAO DEBT EXPENSE 0.00 0.0 8554.29 0.1 709 INTEREST EXPENSE 179.03 0.0 21707,14 0.3 710 BANKING fEES 29.20 0.0 301.70 0.0 711 PENALTY AND INTEREST 108.79 D.0 108.79 0.0 772 OTHER TAX EXPENSE -907.94 -0.2 6110,44 0.7 715 PAYROLL TAX EXPENSE 2473.19 0.4 27628.94 0.4 717 TAX PENALTIES 0.00 0.0 0,00 0.0 721 DEPRECIATION EXPENSE 1400.00 0.2 75400,00 0.2 724 TOOLS 8 EQUIPMENT REPAIRS 2330.70 0.4 13222,82 0.2 725 BUILDING/YARD MAINTENANCE 188.09 0.0 7761,93 0.7 726 LEASE HOLD IMPROVEMENTS 0.00 0.0 6293.38 0.1 741 INSURANCE 4005.92 0.7 58806,73 0.9 742 INSURANCE - GRWP 1399.83 0.2 12107,03 0.2 743 OFFICERS LIFE & DISABILI 660.57 0.1 8773.46 0.1 744 L1 FE & DISABILITY 577.08 0.1 6028,70 0.1 746 EDUCATION 0.00 0.0 0,00 0.0 747 DUES & SUBSCRIPTIONS 877.15 0.2 4284,92 0.1 748 TRADE FEES 630.98 0.1 2693.90 0.0 751 PROFESSIONAL FEES 2572.17 0.4 8880,15 0.1 752 EDUCATION 8 ADVANCEMENT 195.00 0.0 1951,86 0.0 754 OFFICE SUPPLIES 8 EXPENSE 2023.29 0.4 12914,30 0.2 757 SOFTWARE LEASE EXPENSE 0.00 0.0 0.00 0.0 758 COMPUTE LEASE / PURCHASE 0.00 0.0 0,00 0.0 762 CUSTOMER 8 EMPL RELATIONS 7144,41 0.2 10788.05 0.2 764 ADVERTISING 8 PROMOTION 632.42 0.1 4770,54 0.1 766 CONTRIBUTIONS 0.00 0.0 1631.29 0.0 787 TELEPHONE E%PENSE 4332.48 0.8 42550.05 0.6 04/.10/98 MART, INC, PAGE 2 STATEMENT OF INCOME FOR YEAR ENDING 03/31/98 for the Period 02/06/98 - 03/05/98 CURRENT X YEAR-TO-DATE X 783 UTILITY EXPENSES 172,43 0.0 6416.76 0.1 786 TRUCK EXPENSES _ 2098,80 0.4 32241.91 0.5 787 TRAVEL EXPENSE 750,00 0.0 2575.71 0.0 790 LABOR BURDEN -1975.00 -0.3 -27834.13 -0.3 TOTAL GEN & ADMIN EXP 37773,13 b.b 540711.91 8.2 ~ OPERATING INCOME 1528,47 0.3 7037.68 0.1 NON-OPER INCOME & E%PENSE 901 INTEREST INCOME 0,00 0.0 0.00 0.0 905 OTHER INCOME 0,00 0.0 5083.45 0.1 921 GAIN/LOSS ON ASSET SALE 7000,00 0.2 1000.00 0.0 950 LOBBYING EXPENDITURES 0,00 0.0 0.00 0.0 951 FED INCOME TAX EXPENSE 0,00 0.0 0.00 0.0 • TOTAL NON-OPER INC 8 EX 1000,00 0.2 6083.45 0.1 * NET INCOME OR LOSS (7) 2528,47 0.4 13715.13 0.2 - - ---_ .,.. _. _.., w. awu rtcucc_r u ran .'e u~~.. raVC ~. ROBLES & SONS, INC. JUNE 30, 1997 FOX Bt COMPANY, P.C/ CEHfIFIED CUBLIC ACCOUNTANTS ROBLES & SONS, INC. FINANCIAL STATEMENTS (Consolidated) JIINE 30,1997 FOX & COMPANY MEMBEw3 4MERIGAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS 21 t ®GRANT AV E EL PA50. TEXAS 79930 18131 332-9968 To the Board of Directors Robles & Sons, Inc. El Paso, Texas We have compiled the accompanying consolidated statement of assets, liabilities, and equity - income tax basis of Robles & Sons, Inc., and its subsidiary as of June 30, 1997, and the related consolidated statement of revenues, expenses, and retained earnings -income tax basis for the six momhs then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. The financial statements have been prepazed on the accounting basis used by Robles & Sons, Inc., for income tax purposes, which is a comprehensive basis of accounting other than generally accepted accouming principles. A compilation is limited to presenting in the form of financial statemems information that is the representation of management. We have not audited or reviewed the accompanying financial statements and, accordingly, do not express an opinion or any other form of assurance on them. Management has elected to omit substantially all of the disclosures ordinan7y included in financial statemems prepared on the income tax basis of accounting. Iftbe omitted disclosures were included in the financial statemems, they might influence the user's conclusions about the Company's assets, liabilities, equity, revenues, and expenses. Accordingly, these financial statements are not designed for those who are not informed about such matters. ~~a ~ Fox & Company, P:C. February 17, 1998 V .. ~,•y~~~ yJ. ~y ~yV "OJl-JOJV RVLLLJ ,X rV~...r, a~.v. ROBLES Et SONS, INC. STATF'MENT OF ASSETS, LL4BII.ITIES, AND EQUITY -INCOME TAX BASIS (Consolidated) ]IINE 30, 1997 ASSETS Current Assets Cash and cash equivalents 5309,069.88 Demolition wnttacts, and other trade receivables 593,859.51 Notes receivable, torrent 7,329.66 Accrued interest and other receivables 988.28 Inventory 58,216.81 Employee advances 1,134.61 prepaid expenses 1,131.77 Total Current Assets 771.730.52 Property and Ennioment Land 358,233.66 Buildings 166,343.61 Vehicles 542,934.33 Machinery and equipmenr 1,290.141.25 Total Property aced Equipment 2,357,634.83 Accumulated depreciation (1.197,194.65) Net Property aced Equipment 1,160,460.20 Other Assets Notes receivable, long term 95,796.53 Deposits and other assets 1.150.00 Total Other Assets 96.946.53 TOTAL ASSETS 52,029,137.25 L1ABII.ITIES AND STOCKHOLDERS' EQUITY Ctrrtent Liabilities Notes payable, current maturities 5285,100.74 Aocotmts payable 2%,494.90 Accrued 17,029.09 Deferred income, cvrreat 4,659.81 Federal inwme tax payable 53,041.90 Total Current Liabilities 656,326.44 Lone Term Liabilities Notes payable, net of cturertt maturities dS3,971.21 Deferred inwme, »on current 60,904.01 I,~ fr0m ga~~ ~ 216,700.% Tots! Long Term Liabilities 731,576.18 Tots! Liabilities 1,387,902.62 Stockholders' Equity Common stod4 51.00 par, 5,600 shares issued and outstanding 5,600.00 ~~~ Earnings 633,634.63 Total Stockholders' Equity 641,234.63 TOTAL LiAB1LI7TES AND STOCKHOLDERS' EQUITY S2 02~ 9,t~37.25 See accountants' report. 01/27/19981 15:^_i 210-651-5696 ROBLES & SONS, INC. PAGE 0b ROBLES .~ SONS, INC. STATEMENT OF REVEN[JES, EXPENSES, AND RETAINED EARNINGS - INCOMETAX BASIS (Consolidated) FOR THE SDC MONTHS ENDP.D J[)NE 30, 1997 Demolition coatmcts Sales Gross Income Cost of Revenues Subcontract msts Dump fees Labor Truck cad equipment fuel trod pacts Deprecation on machinery and equipmem Equipment rental Egttipmem t+epaits and maintenance Purchases Tools and supplirs Travel and lodging, demolition jobs Total Cost of Revenues Gross Profit Operating expenses Net Income fmm Operations Other Revenues and (Expenses) Rents Tmcldag contracts Interest Gain on sale of land Delivery fees and other income Total Other Revenues Inwme before Income Taxes Income Taxes Net Income Rttained Earnings, December 31, 1996 Retained Earnings, June 30, 1997 52,327,057.47 199,106.97 2,526,164.44 335,109.12 235,433.59 338,819.50 124,966.88 124,1!2.71 360,755.18 46,916.03 16,654.85 73,630.99 59,573.25 1,735,972.10 790,I92.34 354,244.00 435,948.34 5,700.00 6,410.00 2,707,28 1,092.25 530.00 153 452,387.87 51.838.00 400,549.87 235,084.76 7635,634,63 See accountants' report. Fra 19 9B 06:Ira +.+V-Opy-DOJO RVOLGa y 7lb Y~li Lam. FOX 8c COMPA_ NY~_P~~. f y /c:SKT KtEU Y!J9L•C nC~O ~M iANT~ p.i MpMbr Ry i I ~ t CRA4T AYE f~'a.~N lNlt 'U 1. ~ EV 1450 :SkAy >O)!J eL4r ~ ~fG ^vbuP >b L rU'-'>~++5 :T 515~t 9996 S1U~, For the June 3U, 1997 financial statements, we prepared eotnpiied finandal statements on the income tax buffs aid Lett out the Worts and suppiettteraaty information notawlly induded with the yeu cad financial statements. For f`onding pu: poses, we generaih prepare reviewed statements, usually on a GAAP basis, and include aU of the notes a.~d spproptiate suppiementa! information. However, because of the ti~r+e G(7mstraitrta, and the nee3 to got s.trtething to the bonding agent, you and I decided thu this was the best way' to go. pez-s~let me know if you have azry~ questions. G~y`.t References: Robles 6 Sons,lnc. (San Antonio) 'n Contact Contrast -~ Contractor Parson Sum Job i µame Location g 125,084. LIaY San Antonio Columtila Alamo tm~~.,,..._. - 454 Soledad q 100 Sales Texas Industries San Antonio, TX 78205 William ft. Hood Barracks Guyca, lnc• O, Box 1030 P Crawford Texas 14,000 Block . LamPa~s, TX 76550 [512)556'5451 i Stoddard CansUuct'wn Co . ~ o San Anton Inlemalgnal Texas P. O. Box 33126 TX 78265 nio t , ( Center ;, , o San An (210) 653-1324 ~ SiVverton Constructwn UnNersity of 7 Robeh Ferteit ~_ Renovatons 8. Expan~ons o} Texas at P p Box 1853 Austin, TX 78760 Neuhaus-Royal Austin yo Completed io Dale $ 560,678.48 100% $ 277,700.00 100% 95~ $ 218,250.00 95 64500 100% Athletic Gen{er Rawlins Construction, Inc• ite 100 Rtctlarti $ 4 tns Rawl AbBene Westgate Matl Texas 508 Twi1'19ht Trait, Su TX ?5080 dson , Richar (9721 g07.7282 $ 98,000.00 ' rade Recruit U Lackland E. Z. MechaM~l 7366 Caribou St. Ken Vollmer pg Dorms BWg. gyo'Anlonio San Antonio, TX 78238 5 > 6275 8 9065 Texas (210) 521-551 700.00 102 $ ations of Fort Worth Lingeck Cortstructwn Gorp Ghrystanne 1 Main Street, # 1801 Trask , Renov ' Beckham ,Texas ~ 20 TX 76102 fort Worth. .~ Texas Ghdstian (817) 348-7701 $483,000.00 University Steve ' EI Paso Times EI Paso SamCorp 1201 N. pAesa Sambrano Building Texas EI peso, TX (915) 534.9181 100`!0 30% 70°ti Balance to Cprpplete 5°l0 70°b 30°Jo Scheduled Date 01 ComRletion