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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND
- -- EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended December 31, 1997
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND
- -- EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
Commission file number 0-25428
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MEADOW VALLEY CORPORATION
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(Exact name of registrant as specified in its charter)
Nevada 88-0328443
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(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
4411 South 40th Street, Suite D-11, Phoenix, AZ 85040
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(Address of principal executive offices) (Zip Code)
(602) 437-5400
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(Registrant's telephone number, including area code)
SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT: NONE
SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
Title of each class: Name of exchange on which registered:
Common stock, $.001 par value Nasdaq National Market
Common stock purchase warrants Nasdaq National Market
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes x No ___
---
Indicated by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K x
---
On February 27, 1998, the aggregate market value of the registrant's voting
stock held by non-affiliates was $14,654,878
On February 27, 1998, there were 3,601,250 shares of Common Stock
outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
The registrant incorporates by reference into Part III of this Report,
information contained in its definitive proxy statement disseminated in
connection with its Annual Meeting of Shareholders for the year ended December
31, 1997.
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PART I
ITEM 1. BUSINESS
GENERAL
The following is a summary of certain information contained in this Report
and is qualified in its entirety by the detailed information and financial
statements that appear elsewhere herein. Except for the historical information
contained herein, the matters set forth in this Report include forward-looking
statements within the meaning of the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995. These forward-looking statements are
subject to risks and uncertainties that may cause actual results to differ
materially. These risks and uncertainties are detailed throughout the Report and
will be further discussed from time to time in the Company's periodic reports
filed with the Commission. The forward-looking statements included in the Report
speak only as of the date hereof.
Meadow Valley Corporation (the "Company") was incorporated in Nevada on
September 15, 1994. On October 1, 1994, the Company purchased all of the
outstanding Common Stock of Meadow Valley Contractors, Inc. ("MVC"), for $11.5
million comprised of a $10 million promissory note and $1.5 million paid by the
issuance of 500,000 restricted shares of the Company's Common Stock valued at
$3.00 per share. MVC was founded in 1980 as a heavy construction contractor and
has been engaged in that activity since inception. References to the Company's
history include the history of MVC.
Operating through MVC, the Company is a heavy construction contractor
specializing in structural concrete construction of highway bridges and
overpasses and the paving of highways and airport runways. The Company generally
serves as the prime contractor for public sector customers (such as federal,
state and local governmental authorities) in the states of Nevada, Arizona, Utah
and New Mexico. The Company believes that specializing in structural concrete
construction has contributed significantly to its revenue growth and provides it
with an advantage in the competitive bidding process. However, such
specialization limits the types and sizes of projects upon which the Company
bids and may be a competitive disadvantage for projects in which the amount of
work proposed to be completed by the prime contractor (as compared to the amount
of work which will be subcontracted by the prime contractor) is a consideration
in the bidding process. The Company primarily seeks public sector customers
because public sector projects are less cyclical than private sector projects,
payment is more reliable, work required by the project is generally standardized
and little marketing expense is incurred in obtaining projects.
The Company had a project backlog of approximately $214 million at December
31, 1997, which included a $91.8 million reconstruction of the core of the
interchange at I-15 and US 95 in Las Vegas, NV, portions of a $39 million
sitework for a new terminal at McCarran International Airport in Las Vegas, NV,
portions of the $36 million Squaw Peak Pkwy Shea-Thunderbird Freeway
Continuation in Phoenix, AZ, and portions of a $55 million Pima Freeway
Continuation, in Phoenix, AZ. The Company's backlog includes approximately $124
million of work that is scheduled for completion during 1998. The Company has
acted as the prime contractor on projects funded by a number of governmental
authorities, including the Federal Highway Administration, the Arizona
Department of Transportation, the Nevada Department of Transportation, the Utah
Department of Transportation, the Clark County (Nevada) Department of Public
Works, the Salt Lake City (Utah) Airport Authority, the New Mexico Department of
Transportation and the City of Phoenix.
On October 16, 1995, the Company sold 1,675,000 Units of its securities to
the public at $6.00 per Unit (the "Public Offering"). Each Unit consisted of one
share of $.001 par value common stock and one common stock purchase warrant. In
November 1995, the Company sold an additional 251,250 Units pursuant to its
underwriters' overallotment option.
In 1996, the Company acquired certain assets of AKR Contracting ("AKR"), an
unaffiliated Company in Phoenix, Arizona. AKR specializes in earthwork, grading
and paving of residential subdivisions, commercial centers and has become
increasingly involved in small publicly funded projects in Arizona and New
Mexico. Through AKR, the Company entered into operating leases for a portable
hot mix asphalt plant and related paving equipment and a rubberized asphalt
plant. The asphalt paving capabilities provide the Company the opportunity to
expand its existing geographic market. The Company believes increased
competitiveness and revenues will be generated on projects that call for large
quantities of asphaltic concrete, recycled asphalt or rubberized asphalt.
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In 1996, the Company formed Ready Mix, Inc. ("RMI") as a wholly-owned
subsidiary. RMI manufactures and distributes ready mix concrete in Las Vegas,
NV, and targets markets such as concrete subcontractors, prime contractors, home
builders, commercial and industrial property developers, pool builders and
homeowners. RMI began operations from its first location in March 1997.
Financed with internal funds, a $2 million line of credit, notes payable and
operating leases, the Company intends for RMI to operate from two sites using at
least 40 mixer trucks.
In 1996, the Company formed Prestressed Products Incorporated ("PPI") as a
wholly-owned subsidiary. PPI designs, manufactures and erects precast
prestressed concrete building components for use on commercial, institutional
and public construction projects throughout the Southwest. Product lines
include architectural and structural building components and prestressed bridge
girders for highway construction. During 1997, PPI began operations with a
precast yard and concrete batch plant located on leased property adjacent to the
Company's office in Moapa, Nevada.
During 1997, financed through internal funds and operating leases, the
Company obtained equipment and experienced personnel to enter the concrete or
"white" paving market. By performing white paving work, the Company may be able
to increase its project revenue and earnings, reduce reliance on white paving
subcontractors and improve the likelihood of being awarded projects in which the
amount of work proposed to be completed on a project by the prime contractor is
a consideration in the competitive bidding process.
BUSINESS STRATEGY
The Company seeks to generate revenue growth and profitability by pursuing the
following business strategy:
(i) Expand Construction-related Niche Markets. The Company will continue to
explore niche markets which may increase the Company's competitiveness,
diversify its revenue base, increase project revenue and improve profitability.
(ii) Solidify Market Position. The Company intends to continue to expand its
operations in Nevada, Arizona, Utah and New Mexico and consider expansion into
other western states.
(iii) Seek to Acquire Other Businesses. The Company will seek to acquire other
businesses that provide subcontracting services used by the Company in its
projects, complement the Company's existing construction expertise or offer
construction services similar to the Company in other geographic markets. In
certain circumstances, the Company may join with one or more companies
combining expertise, financial strength, and/or bonding capacity. Through a
joint venture, the Company may be able to pursue projects which might otherwise
exceed its staffing or bonding resources, including design-build type projects
currently contemplated by governmental entities within the Company's existing
market area.
(iv) Increase Bonding Capacity. The Company retained a portion of the
proceeds of its Public Offering to increase its bonding capacity in order to
bid upon more and larger projects. The Company intends to retain a portion of
future earnings to further increase its bonding capacity. See "Insurance and
Bonding."
MARKET OVERVIEW
The Company believes that infrastructure construction (primarily highways,
bridges, overpasses, tunnels and other transportation projects) in the western
United States is substantial and will generate continued federal, state and
local government expenditures. In 1997 the U.S. Congress began debate for
renewal of the Intermodal Surface Transportation Efficiency Act of 1991
("ISTEA"). Unable to reach a final agreement before the close of the
legislative session, Congress simply extended the existing law through April 30,
1998. Absent action from Congress, states would be prohibited from obligating
federal funds after May 1, 1998. However, the U.S. Senate has now begun debate
on S. 1173 - the Intermodal Surface Transportation Efficiency Act of 1997 or
("ISTEA II"). There is support for an increase in the amounts to be authorized
under this new act which is expected to provide the bulk of infrastructure
funding through 2003. The Company believes that Congress will pass ISTEA II, or
some form thereof, with an increase over previous obligations in order to meet
the growing infrastructure needs of the nation's transportation system. In
March, 1998, the U.S. Senate adopted an agreement that will boost federal
highway spending by $25.8 billion from $145 billion to approximately $171
billion. Most of the funding increase will be spread over the final years
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of ISTEA II, providing for a federal highway program funded at an annual average
of approximately $29 billion during the years 1999-2003. The collection of
federal gas taxes and other user fees has historically exceeded the amounts
reinvested into transportation by the government, thereby allowing the "surplus"
in the Highway Trust Fund to minimize the overall budget deficit. The actual
projected income to the Highway Trust Fund is closer to $31 billion per year as
opposed to the expenditure of approximately $21 billion per year, therefore,
there is room to increase spending and still remain within the income stream of
the trust fund.
The growth of the Company's market has been exceptional. The states of
Arizona, Nevada and Utah continue to lead the nation in key growth statistics.
In particular, the three metropolitan areas of Phoenix, Salt Lake City and Las
Vegas are leading growth markets. Nevada led the nation in population growth,
with Arizona in second place and Utah was third (tied with Georgia). Nevada, on
a percentage basis, was also the leader in employment growth. Maricopa County,
Arizona and Clark County, Nevada were #3 and #6, respectively, in actual number
of jobs created in 1997. This growth has led to high levels of residential and
commercial construction and to increased infrastructure work. It is expected
that highway and street spending in the Company's market will increase
approximately 7% over 1997.
The State Departments of Transportation, counties and municipalities,
along with metropolitan planning organizations, are primarily responsible for
programming capital improvements in streets, highways, freeways and airports.
Most of these organizations are expecting increased spending over 1997 levels.
The precise amounts will be greatly affected by the final outcome of ISTEA II.
In addition to federal funds administered through the states, there are other
funding mechanisms in place to increase infrastructure investment. Maricopa
County, Arizona and Clark County, Nevada continue to collect a half-cent sales
tax for the specific purpose of constructing multi-billion dollar freeway
transportation facilities. Both programs will continue to receive funds through
2015. The airports in Phoenix, Las Vegas and Salt Lake City also have
significant capital improvement programs, in excess of $1 billion each. In Salt
Lake City, another design-build contract is being discussed to build the new
Legacy Freeway valued at approximately $400 million. Depending upon resolution
of alignment and environmental issues, this project could go out for proposal
during 1998 or 1999.
The Company's two newest subsidiaries, RMI and PPI, are affected most by
the amount of new residential and commercial construction in the Las Vegas area.
Forecasts for 1998 predict that the residential and commercial construction in
the Las Vegas area will be somewhat less than 1997's record levels. Large hotel
and casino projects built during 1996 and 1997 will not likely repeat in 1998
and will account for the largest drop-off. RMI's primary customers have been
residential builders and that market segment is expected to remain strong;
however, we expect stiffer competition from those companies previously supplying
the major projects. PPI's market appears to have sufficient activity to fill
production capacity.
The Company believes that the overall health of its existing markets
will present many opportunities for improved performance.
OPERATIONS
In addition to the construction of highways, bridges, overpasses and
airport runways, the Company constructs other heavy civil projects. From its
Phoenix, Arizona corporate office and area offices in Moapa, Nevada, Salt Lake
City, Utah and New Mexico, the Company markets (primarily by responding to
solicitations for competitive bids) and manages all of its projects. Project
management is also located on-site to provide direct supervision to the
operations.
In addition to profitability, the Company considers a number of factors
when determining whether to bid on a project, including the location of the
project, likely competitors and the Company's current and projected workloads.
The Company uses a computer-based project estimating system which reflects its
bidding and construction experience and which the Company believes best
identifies a project's risks and opportunities. The Company develops
comprehensive estimates with each project divided into phases and line items for
which separate labor, equipment, material, subcontractor and overhead cost
estimates are compiled. Once a project begins, the estimate provides the Company
with a budget against which ongoing project costs are measured. There can be no
assurance that every project will attain its budgeted costs. A number of factors
can affect a project's profitability including weather, availability of a
quality workforce and actual productivity rates. Each month the project manager
updates the job's projected performance at completion by using actual costs-to-
date and re-forecasted costs-to-complete for the
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balance of the work remaining. Regular review of the estimated costs to complete
permit project, area and corporate management to be as responsive as possible to
cost overruns or other problems that may affect profitability.
The Company owns some of the equipment used in its business lines,
including cranes, backhoes, scrapers, graders, loaders, trucks, trailers,
pavers, rollers and batch plants and related equipment. The net book value of
the Company's equipment at December 31, 1997 was approximately $9.1 million. The
increase is due primarily to the additional equipment needed for the added
construction workload and for the subsidiaries, RMI and PPI, which commenced
operations during the year. The Company leases a significant portion of its
equipment and attempts to keep the equipment as fully utilized as possible and
may rent equipment on a short-term basis to other contractors.
The Company's corporate management oversees operational and strategic
issues and, through the corporate accounting staff, provides administrative
support services to area managers, subsidiary presidents and individual project
management at the project site. The latter are responsible for planning,
scheduling and budgeting operations, equipment maintenance and utilization and
customer satisfaction. Subsidiary presidents, area managers and project managers
monitor project costs on a daily and weekly basis while corporate management
monitors such costs monthly.
Raw materials (primarily concrete, aggregate and steel) used in the
Company's operations are available from a number of sources. There are a
sufficient number of materials suppliers within the Company's market areas to
assure the Company of adequate competitive bids for supplying such raw
materials. Generally, the Company will obtain several bids from competing
concrete, asphalt or aggregate suppliers whose reserves of such materials will
normally extend beyond the expected completion date of the project. Costs for
raw materials vary depending upon project duration, construction season, or
other factors; but, generally, prices quoted to the Company for raw materials
are fixed for the project's duration. Increased construction activity in the
western United States has created temporary scarcity of key construction
materials, primarily cement powder. It is foreseeable that shortages of cement
supply might reoccur which could result in unexpected and uncontrollable
reductions in sales of ready mix concrete from RMI, the Company's ready mix
concrete subsidiary. The Company strives to obtain supply commitments from a
number of suppliers, but their supply capacity is occasionally exceeded by spot
demands. The Company has not yet been impacted by any cement shortages on its
construction projects, as it normally obtains guaranteed commitments for supply
of cement powder for the duration of the contracts and any damages incurred by
lack of supply could be assessed back to the supplier.
PROJECTS AND CUSTOMERS
The Company specializes in public sector construction projects and its
principal customers are the state departments of transportation in Nevada,
Arizona, Utah and New Mexico and bureaus and departments of municipal and county
governments in those states. For the year ended December 31, 1997, revenue
generated from six projects in Nevada, Arizona and Utah represented 56% of the
Company's revenue. The discontinuance of any projects, a general economic
downturn or a reduction in the number of projects let out for bid in any of the
states in which the Company operates, could have an adverse effect on the
Company's results of operations. In each of the three years ended December 31,
1995,1996 and 1997 Clark County General Services and the Arizona Department of
Transportation each accounted for over 10% of the Company's consolidated
revenue. Additionally, the Utah Department of Transportation accounted for over
10% of the Company's consolidated revenue during the year ended December 31,
1997.
The following table describes all projects substantially completed by the
Company in each of the three years ended December 31, 1995, 1996 and 1997.
Contract amounts include agreed upon change orders, if any, and represent the
total dollar value of the contract to the Company.
<TABLE>
<CAPTION>
CONTRACT COMPLETION
CUSTOMER PROJECT DESIGNATION LOCATION AMOUNT DATE
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<S> <C> <C> <C> <C>
City of Phoenix Grand Canal Phoenix, AZ $ 43,845 January 1995
</TABLE>
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<TABLE>
<CAPTION>
CONTRACT COMPLETION
CUSTOMER PROJECT DESIGNATION LOCATION AMOUNT DATE
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<S> <C> <C> <C> <C>
Arizona Department
of Transportation Squaw Peak Parkway Phoenix, AZ $ 25,733,328 May 1995
Arizona Department
of Transportation Casa Grande Highway Phoenix, AZ 27,052,138 May 1995
Clark County Nevada
General Services Flamingo Winnick Las Vegas, NV 2,687,309 May 1995
Clark County Nevada
General Services Airport North Portal Las Vegas, NV 15,068,853 May 1995
Arizona Department
of Transportation Red Mountain Freeway Phoenix, AZ 12,684,836 May 1995
Salt Lake City, Utah
Airport Authority 40/th/ Street Relocation Salt Lake City, UT 2,293,088 May 1995
Clark County Nevada
General Services Van Buskirk Las Vegas, NV 3,175,206 May 1995
Continental Insurance Gila River Phoenix, AZ 3,594,017 May 1995
City of Mesquite, Nevada Mesquite Mesquite, NV 316,244 October 1995
Lincoln County, Nevada Panaca, NV Panaca, NV 243,903 October 1995
Colorado River
Commission River Mountain Las Vegas, NV 1,300,901 November 1995
City of Mesquite, Nevada Summer Ridge Mesquite, NV 63,323 December 1995
City of Mesquite, Nevada Hillside Storm Drain Mesquite, NV 162,103 December 1995
City of Henderson,
Nevada C-1 Channel Henderson, NV 1,086,497 October 1995
Arizona Department
of Transportation Highway at Heber Heber, AZ 5,535,662 April 1996
Arizona Department
of Transportation I-17 Widening Phoenix, AZ 8,832,295 October 1996
DG Fenn Baptist Retirement Phoenix, AZ 78,468 October 1996
Salt Lake City Airport
Authority South Cargo Salt Lake City, UT 1,517,428 October 1996
Intermountain
Roadbuilders Davis Monthan - Streets Tucson, AZ 344,418 April 1996
Town of Youngtown Youngtown Streets Youngtown, AZ 77,423 February 1996
</TABLE>
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<TABLE>
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CONTRACT COMPLETION
CUSTOMER PROJECT DESIGNATION LOCATION AMOUNT DATE
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<S> <C> <C> <C> <C>
Arizona Department
of Transportation Pima Freeway Phoenix, AZ $ 7,546,838 May 1996
Salt Lake City Salt Lake
Airport Authority Salt Lake City Airport City, UT 27,364,636 January 1996
Clark County Nevada
General Services South Beltway Las Vegas, NV 16,175,964 January 1996
Arizona Department
of Transportation Dunlap Phoenix, AZ 8,198,181 January 1996
VFL Technology
Corporation Chevron Cell Construction Salt Lake City, UT 1,362,974 June 1996
Arizona Department
of Transportation Chandler Boulevard Phoenix, AZ 2,209,435 May 1996
Utah Department of
Transportation Snow Canyon Southern, UT 4,138,290 January 1996
Arizona Department
of Transportation Navajo Papermill Road Phoenix, AZ 641,061 January 1996
Intermountain
Roadbuilders Intermountain Roadbuilders Phoenix, AZ 264,845 January 1996
Arizona Department
of Transportation Goodyear Urban Goodyear, AZ 463,665 August 1996
Crescent Run LLP Crescent Run Mesa, AZ 262,261 April 1996
Wespac Lost Canyon II Scottsdale, AZ 152,778 October 1996
City of Winslow City of Winslow Winslow, AZ 1,402,868 September 1996
Clark County Dept.
of Aviation Searchlight Searchlight, NV 707,977 January 1996
Arizona Department
of Transportation Nogales Connection Nogales, AZ 11,327,515 October 1996
Clark County Dept.
of Aviation Jean Airport Jean, NV 3,897,065 March 1997
Clark County Dept.
of Aviation McCarran Garage Infrastructure Las Vegas, NV 6,203,284 November 1997
Intermountain
Roadbuilders Davis Monthan - Taxiway Tucson, AZ 162,677 March 1997
City of Henderson Equestrian Detention Henderson, NV 5,436,067 March 1997
</TABLE>
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<TABLE>
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CONTRACT COMPLETION
CUSTOMER PROJECT DESIGNATION LOCATION AMOUNT DATE
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<S> <C> <C> <C> <C>
Homes by Dave
Brown Country Estates Gilbert, AZ $ 215,770 July 1997
Chanen Midwestern University II Glendale, AZ 230,579 January 1997
Moapa Water District Moapa Water District Moapa, NV 903,919 January 1997
City of Phoenix Collector Street Overlay Phoenix, AZ 1,820,288 January 1997
Triton Builders AT&T Expansion Mesa, AZ 246,080 January 1997
City of Phoenix Skunk Creek Landfill Phoenix, AZ 2,845,955 January 1997
City of Las Vegas Detention Facility Las Vegas, NV 430,700 February 1997
Robert Ewing Lone Butte 3 & 4 Maricopa County 201,979 February 1997
Frehner Construction Precast Las Vegas, NV 89,924 January 1997
City of Gilbert Municipal Parking Expansion Gilbert, AZ 154,492 January 1997
Kay Rogers/ADA
Construction Legacy II Phoenix, AZ 194,023 August 1997
United States Dept.
of Agriculture Tonto Forest Arizona 99,515 July 1997
Mayo Clinic/Ryan
Cos. Mayo Arrowhead Glendale, AZ 155,165 October 1997
Robert Ewing Lone Butte Industrial Maricopa County 225,000 February 1997
Nevada Department
of Transportation Eastern State Highway System Las Vegas, NV 2,260,492 October 1997
City of Bisbee Bisbee Municipal Airport Bisbee, AZ 295,712 January 1997
Clark County General
Services CCPW Bridge Repair Las Vegas, NV 42,214 December 1997
</TABLE>
The following table describes all projects of the Company in progress as of
December 31, 1997. Current contract amounts include agreed upon change orders,
if any, and represent the dollar value of the contract to the Company.
<TABLE>
<CAPTION>
CURRENT AWARD DATE/
CONTRACT ESTIMATED
CUSTOMER PROJECT DESIGNATION LOCATION AMOUNT COMPLETION DATE
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<S> <C> <C> <C> <C>
Clark County, Nevada McCarran Airport Parking January 1995/
General Services Garage Las Vegas, NV $ 60,290,797 March 1998
Clark County Department August 1995/
of Public Works LV Beltway Las Vegas, NV 29,169,402 March 1998
</TABLE>
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<TABLE>
<CAPTION>
CURRENT AWARD DATE/
CONTRACT ESTIMATED
CUSTOMER PROJECT DESIGNATION LOCATION AMOUNT COMPLETION DATE
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<S> <C> <C> <C> <C>
Arizona Department of Phoenix - Casa Grande (Joint November 1995/
Transportation Venture) Phoenix, AZ $ 20,930,123 March 1998
Clark County Department March 1996/
of Aviation Runway Extension Las Vegas, NV 11,142,129 March 1998
Clark County Department June 1996/
of Aviation Ticketing Facility Las Vegas, NV 8,282,903 March 1998
Clark County Department June 1996/
of Aviation Union Pacific R.R.Relocation Las Vegas, NV 2,019,620 March 1998
Clark County Department August 1996/
of Aviation Terminal D Sitework Las Vegas, NV 39,444,911 April 1998
Dept. of United States June 1996/
Army White Sands Missile Range New Mexico 1,956,670 July 1999
Dept. of Transportation July 1996/
Hwy. Administration Wiggins Crossing Arizona 794,611 March 1998
Clark County Department October 1996/
of Aviation McCarran Air Cargo Expansion Las Vegas, NV 2,543,872 March 1998
New Mexico Department August 1996/
of Transportation I-25/Socorro New Mexico 3,319,865 June 1998
Arizona Department of Squaw Peak Shea-TBird October 1996/
Transportation Continuation Phoenix, AZ 36,494,376 February 1999
United States Forest Roosevelt Lake, October 1996/
Service School House Campground AZ 4,774,604 April 1998
October 1996/
Jackson Properties Country Meadows Maricopa County 929,815 February 1998
Utah Department of October 1996/
Transportation I-15/Woods Crossing Salt Lake, UT 17,205,605 June 1998
United States Marine October 1996/
Corp. Yuma Taxiway Repair Yuma, AZ 705,793 March 1998
Arizona Department of November 1996/
Transportation Douglas Rodeo Highway Douglas, AZ 1,435,326 March 1998
December 1996/
City of Mesa City of Mesa Sealcoat Mesa, AZ 84,013 March 1998
Arizona Department of February 1997/
Transportation Payson Show-Low Payson, AZ 3,764,594 March 1998
</TABLE>
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<TABLE>
<CAPTION>
CURRENT AWARD DATE/
CONTRACT ESTIMATED
CUSTOMER PROJECT DESIGNATION LOCATION AMOUNT COMPLETION DATE
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Clark County General March 1997/
Services Sloan Channel Las Vegas, NV $ 1,296,493 March 1998
Nevada Department of April 1997/
Transportation NDOT Bike Path Las Vegas, NV 1,654,113 March 1998
Clark County General May 1997/
Services Channel Repair Las Vegas, NV 198,882 May 1998
Clark County General August 1997/
Services Russell Road Las Vegas, NV 4,742,339 March 1998
Arizona Department of April 1997/
Transportation White River Arizona 673,213 March 1998
October 1997/
City of Phoenix City of Phoenix Overlay II Phoenix, AZ 2,207,621 February 1998
Arizona Department of Coconino County, June 1997/
Transportation Blueridge-Forest AZ 2,247,621 March 1998
Fann Coconino County, September 1997/
Construction Clint's Well AZ 685,266 March 1998
Clark County General September 1997/
Services McCarran Mobil Home Park Las Vegas, NV 7,680,542 April 1998
Arizona Department of June 1997/
Transportation Pima Freeway Phoenix, AZ 55,104,378 September 1999
Utah Department of Salt Lake City, August 1997/
Transportation Bangerter Highway UT 17,887,071 January 1999
Dept. of United States August 1997/
Army White Sands MissileRange New Mexico 2,000,000 August 1999
Salt Lake City Airport Salt Lake City, August 1997/
Authority Utah Taxiway UT 9,000,204 June 1998
Arizona Department of August 1997/
Transportation Ashfork Devildog Williams, AZ 3,612,303 August 1998
Maricopa County Dept. Maricopa County, September 1997/
of Parks & Recreation Lake Pleasant AZ 1,628,582 March 1998
September 1997/
Victory Valley Land Lake Mead Henderson, NV 2,767,886 February 1998
September 1997/
City of Showlow City of Showlow Showlow, AZ 2,389,478 October 1998
</TABLE>
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<TABLE>
<CAPTION>
CURRENT AWARD DATE/
CONTRACT ESTIMATED
CUSTOMER PROJECT DESIGNATION LOCATION AMOUNT COMPLETION DATE
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
New Mexico Department Donna Ana County, December 1997/
of Transportation I-15/Hatch NM $ 3,914,175 August 1998
New Mexico Department December 1997/
of Transportation NM Ruidoso Ruidoso, NM 8,399,870 November 1998
Arizona Department of Coconino County, December 1997/
Transportation SR87-Blueridge AZ 2,249,619 July 1998
Nevada Department of December 1997/
Transportation Spaghetti Bowl Las Vegas, NV 91,813,884 November 2000
</TABLE>
BACKLOG
The Company's backlog (anticipated revenue from the uncompleted portions of
awarded projects) was approximately $214 million at December 31, 1997, compared
to approximately $130 million at December 31, 1996. At December 31, 1997, the
Company's backlog included approximately $124 million of work that is scheduled
for completion during 1998. The Company includes a construction project in its
backlog at such time as a contract is awarded or a firm letter of commitment is
obtained. The Company believes that its backlog figures are firm, subject to
provisions contained in its contracts which allow customers to modify or cancel
the contracts at any time upon payment of a relatively small cancellation fee.
The Company has not been materially adversely affected by contract cancellations
or modifications in the past. A portion of the Company's anticipated revenue in
any year is not reflected in its backlog at the start of the year because some
projects are initiated and completed in the same year.
COMPETITION
The Company believes that the primary competitive factors as a prime
contractor in the construction industry are price, reputation for quality work,
financial strength, knowledge of local market conditions and estimating
abilities. The Company believes that it competes favorably with respect to each
of the foregoing factors. Most of the Company's projects involve public sector
work for which contractors are first pre-qualified to bid and then are chosen by
a competitive bidding process, primarily on the basis of price. Because the
Company's bids are often determined by the cost to it of subcontractor services
and materials, the Company believes it is often able to lower its overall
construction bids due to its prompt payments to, consistent workloads for, and
good relationships with its subcontractors and suppliers. The Company competes
with a large number of small owner/operator contractors that tend to dominate
smaller (under $4 million) projects. When bidding on larger infrastructure
projects, the Company also competes with larger, well capitalized regional and
national contractors (including Granite Construction Incorporated, Peter Kiewit
Sons', Inc. and Sundt Corp., Inc.), many of whom have larger net worths, bonding
capacities and construction personnel than the Company. Due to currently
favorable market conditions in Nevada, Arizona, Utah and New Mexico, which have
resulted in an increase in heavy construction projects in these states,
additional competition for projects may be expected. Such additional competition
could reduce the Company's profit margins on certain projects.
The Company has received single project bond approval up to $100 million
and aggregate program bonds totaling up to $240 million. Larger competitors have
unlimited bonding capacity and, therefore, may be able to bid on more work than
the Company. Except for bonding capacity, the Company does not believe it is at
a competitive disadvantage in relation to its larger competitors. With respect
to its smaller competitors, the Company believes that its larger bonding
capacity, longer relationships with subcontractors and suppliers and the
perceived stability of having been in business since 1980 may be competitive
advantages.
The Company does not believe that the competitive environment is materially
different in other western states in which
11
<PAGE>
the Company may expand. Initially, the Company will be at a competitive
disadvantage in new markets until it obtains information on those markets and
develops relationships with local subcontractors.
THE CONTRACT PROCESS
The Company's projects are obtained primarily through competitive bidding
and negotiations in response to advertisements by federal, state and local
government agencies and solicitations by private parties. The Company submits
bids after a detailed review of the project specifications, an internal review
of the Company's capabilities and equipment availability and an assessment of
whether the project is likely to attain targeted profit margins. The Company
owns, leases, or is readily able to rent, any equipment necessary to complete
the projects upon which it bids. After computing estimated costs of the project
to be bid, the Company adds its desired profit margin before submitting its bid.
The Company believes that success in the competitive bidding process involves
(i) being selective on projects bid upon in order to conserve resources, (ii)
identifying projects which require the Company's specific expertise, (iii)
becoming familiar with all aspects of the project to avoid costly bidding errors
and (iv) analyzing the local market to determine the availability and cost of
labor and the degree of competition. Since 1987, the Company has been awarded
contracts for approximately 18% of the projects upon which it has bid. A
substantial portion of the Company's revenue is derived from projects that
involve ''fixed unit price'' contracts under which the Company is committed to
provide materials or services at fixed unit prices (such as dollars per cubic
yard of earth or concrete, or linear feet of pipe). The unit price is determined
by a number of factors including haul distance between the construction site and
the warehouses or supply facilities of local material suppliers and to or from
disposal sites, site characteristics and the type of equipment to be used. While
the fixed unit price contract generally shifts the risk of estimating the
quantity of units for a particular project to the customer, any increase in the
Company's unit cost over its unit bid price, whether due to inefficiency, faulty
estimates, weather, inflation or other factors, must be borne by the Company.
Most government contracts provide for termination of the contract at the
election of the customer. In such event the Company is generally entitled to
receive a small cancellation fee in addition to reimbursement for all costs it
incurred on the project. Many of the Company's contracts are subject to
completion requirements with liquidated damages assessed against the Company if
schedules are not met. The Company has not been materially adversely affected by
these provisions in the past.
Contracts often involve work periods in excess of one year. Revenue on
uncompleted fixed price contracts is recorded under the percentage of completion
method of accounting. The Company begins to recognize revenue on its contracts
when it first accrues direct costs. Pursuant to construction industry practice,
a portion of billings, generally not exceeding 10%, may be retained by the
customer until the project is completed and all obligations of the contractor
are paid. The Company has not been subject to a loss in connection with any such
retention.
The Company acts as prime contractor on most of its construction projects
and subcontracts certain jobs such as electrical, mechanical and some white
paving work to others. As prime contractor, the Company bills the customer for
work performed and pays the subcontractors from funds received from the
customer. Occasionally the Company provides its services as a subcontractor to
another prime contractor. As a subcontractor, the Company will generally receive
the same or similar profit margin as it would as a prime contractor, although
revenue to the Company will be smaller because the Company only contracts a part
of the project. As prime contractor, the Company is responsible for the
performance of the entire contract, including work assigned to subcontractors.
Accordingly, the Company is subject to liability associated with the failure of
subcontractors to perform as required under the contract. The Company
occasionally requires its subcontractors to furnish bonds guaranteeing their
performance, although affirmative action regulations require the Company to use
its best efforts to hire minority subcontractors for a portion of the project
and some of these subcontractors may not be able to obtain surety bonds. On
average, the Company has required performance bonds for less than 10% of the
dollar amount of its subcontracted work. However, the Company is generally aware
of the skill levels and financial condition of its subcontractors through its
direct inquiry of the subcontractors and contract partners of the
subcontractors, as well as its review of financial information provided by the
subcontractors and third party reporting services including credit reporting
agencies and bonding companies. The Company has experienced subcontractor
related losses of less than .5 of 1% of total revenue over the last five fiscal
years including a loss of .8 of 1% of total revenue for the year ended December
31, 1993. As the Company expands into new geographic areas, it expects to obtain
references and examine the financial condition of prospective subcontractors
before entering into contracts
12
<PAGE>
with them, requiring bonding as deemed appropriate.
In connection with public sector contracts, the Company is required to
provide various types of surety bonds guaranteeing its own performance. The
Company's ability to obtain surety bonds depends upon its net worth, working
capital, past performance, management expertise and other factors. Surety
companies consider such factors in light of the amount of the Company's surety
bonds then outstanding and the surety companies' current underwriting standards,
which may change from time to time. See ''Insurance and Bonding''.
INSURANCE AND BONDING
The Company maintains general liability and excess liability insurance
covering its owned and leased construction equipment and workers' compensation
insurance in amounts it believes are consistent with its risks of loss and in
compliance with specific insurance coverages required by its customers as a part
of the bidding process. The Company carries liability insurance of $17 million
per occurrence, which management believes is adequate for its current operations
and consistent with the requirements of projects currently under construction by
the Company.
The Company is required to provide a surety bond on most of its projects.
The Company's ability to obtain bonding, and the amount of bonding required, is
primarily determined by the Company's management experience, net worth, liquid
working capital (consisting of cash and accounts receivable in excess of
accounts payable and accrued liabilities), the Company's performance history and
the number and size of projects under construction. The larger the project
and/or the more projects in which the Company is engaged, the greater the
Company's bonding, net worth and liquid working capital requirements. Bonding
requirements vary depending upon the nature of the project to be performed. The
Company generally pays a fee to bonding companies of 1/2% to 1% of the amount of
the contract to be performed. Because these fees are generally payable at the
beginning of a project, the Company must maintain sufficient working capital to
satisfy the fee prior to receiving revenue from the project. The Company has
received single project bonding approval up to $100 million and aggregate
program bonds totaling up to $250 million.
MARKETING
The Company obtains its projects primarily through the process of
competitive bidding. Accordingly, the Company's marketing efforts are limited to
subscribing to bid reporting services and monitoring trade journals and other
industry sources for bid solicitations by various government authorities. In
response to a bid request, the Company submits a proposal detailing its
qualifications, the services to be provided and the cost of the services to the
soliciting entity which then, based on its evaluation of the proposals
submitted, awards the contract to the successful bidder. Generally, the contract
for a project is awarded to the lowest bidder, although other factors may be
taken into consideration such as the bidder's track record for compliance with
bid specifications and procedures and its construction experience.
In the precast and ready mix market, which the Company pursues through its
PPI and RMI subsidiaries, a more focused effort is required. Certification of
plants and facilities must be obtained and maintained in order to comply with
certain project requirements. Membership and participation in selected industry
associations help to increase the Company's exposure to potential clients and
are two means by which the Company stays informed as to industry developments
and future prospects within the marketplace. Customer care and service are
important marketing tools for PPI and RMI which focus much more on private
owners than public works. Building and maintaining customer relations and
reputation for quality work are essential elements to the marketing efforts of
these businesses.
GOVERNMENT REGULATION
The Company's operations are subject to compliance with regulatory
requirements of federal, state and municipal authorities, including regulations
covering labor relations, safety standards, affirmative action and the
protection of the environment including requirements in connection with water
discharge, air emissions and hazardous and toxic substance discharge. Under the
Federal Clean Air Act and Clean Water Act, the Company must apply water or
chemicals to reduce dust
13
<PAGE>
on road construction projects and to contain water contaminants in run-off water
at construction sites. The Company may also be required to hire subcontractors
to dispose of hazardous wastes encountered on a project. The Company believes
that it is in substantial compliance with all applicable laws and regulations.
However, amendments to current laws or regulations imposing more stringent
requirements could have a material adverse effect on the Company.
EMPLOYEES
On December 31, 1997, the Company employed approximately 97 salaried
employees (including its management personnel and executive officers) and
approximately 443 hourly employees. The number of hourly employees varies
depending upon the amount of construction in progress. For the year ended
December 31, 1997, the number of hourly employees ranged from approximately 173
to approximately 443 and averaged approximately 322. At December 31, 1997, the
Company's employees did not belong to a labor union and the Company believes its
relations with its employees are satisfactory.
ITEM 2. PROPERTIES
The following properties were leased by the Company at December 31, 1997:
(1) 6,200 square feet of executive office space at 4411 South 40th
Street, Suites D-10 and D-11, Phoenix, Arizona, 85040, expires in
December 2000, at a monthly rental rate of $5,219 per month.
(2) 1,800 square feet of office space at 1598 North 400 West, Suite
C, Layton, Utah 84041, which expires in February 1998, at a
monthly rental rate of $1,050 per month.
(3) 2,000 square feet of office space for the Company's ready mix
operations, at 3430 E. Flamingo , Suite 100, Las Vegas, Nevada,
on a month-to-month basis, at a rental rate of $2,400 .
(4) 2,000 square feet of office space at 1501 Highway 168, Moapa,
Nevada 89025, on a month-to-month basis, at a rental rate of $800
per month, from a Company controlled by a principal stockholder.
The Company believes that its rental rates are fair, reasonable
and consistent with rates charged by unaffiliated third parties
in the same market area.
(5) 17,500 square feet of property at 1501 Highway 168, Moapa, Nevada
89025, on a month-to-month basis, at a rental rate of $2,500 per
month, from a Company controlled by a principal stockholder. The
Company uses the property for its manufacturing of prestressed
concrete products. The Company believes that its rental rates are
fair, reasonable and consistent with rates charged by
unaffiliated third parties in the same market area.
The Company owns approximately five acres of land at 109 W. Delhi, North
Las Vegas, NV 89030, which is used for the manufacturing of ready mix concrete.
The Company owns approximately 24.5 acres of property in Moapa, Nevada,
which is currently being readied for its intended use.
The Company has determined that the above properties are suitable and
adequate for their intended use.
ITEM 3. LEGAL PROCEEDINGS
The Company is a party to legal proceedings in the ordinary course of its
business. The Company believes that the nature of these proceedings (which
generally relate to disputes between the Company and its subcontractors,
material suppliers or customers regarding payment for work performed or
materials supplied) are typical for a construction firm of its size and scope,
and that none of these proceedings are material to its financial condition.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There were no matters submitted to a vote of security holders, through the
solicitation of proxies or otherwise, during the fourth quarter of the fiscal
year ended December 31, 1997.
14
<PAGE>
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The Company's Common Stock has been listed on the Nasdaq National Market
since October 1995 and is traded under the symbol "MVCO". The following table
represents the high and low closing prices for the Company's common stock on the
Nasdaq National Market.
<TABLE>
<CAPTION>
1995 1996 1997
- -----------------------------------------------------------------
HIGH LOW HIGH LOW HIGH LOW
-------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
First Quarter... 6 5/8 5 5 5/8 3 9/16
Second Quarter.. 6 5/8 5 5 7/8 3 1/2
Third Quarter... 7 3/8 4 7/8 6 1/4 5 5/16
Fourth Quarter.. 7 5 1/8 5 1/2 3 5/8 6 9/16 5 1/2
</TABLE>
HOLDERS OF RECORD
As of February 27, 1998 there were more than 900 record and beneficial owners
of the Company's Common Stock.
ITEM 6. SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31, PROFORMA
- ------------------------------------------ COMBINED (1)
1993 1994 1995 1996 1997
---------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Income Statement Data:
Revenues.................................. $ 60,474,750 $ 80,220,521 $ 90,048,523 $ 133,723,645 $ 149,979,395
Gross Profit.............................. 3,461,503 5,472,878 4,354,455 2,810,585 7,434,944
Income (loss) from Operations............. (230,934) 4,704,425 2,364,676 (331,525) 1,867,958
Interest Expense.......................... 3,727 500,000 1,116,464 611,828 624,048
Income (loss) before income taxes (2)..... 60,501 4,565,398 1,608,997 (106,863) 1,930,986
Net income (loss)......................... 37,511 2,824,776 1,059,347 (85,228) 1,211,615
Basic net income (loss) per common share.. $0.02 $0.84 $0.65 $(0.02) $0.34
Diluted net income (loss) per common
share.................................... $0.02 $0.84 $0.65 $(.02) $0.33
Basic weighted average shares
outstanding (3).......................... 1,675,000 3,350,000 1,641,663 3,601,250 3,601,250
Diluted weighted average shares
outstanding.............................. 1,675,000 3,350,000 1,641,663 3,601,250 3,651,360
Financial Position Data: 1993 1994 1995 1996 1997
---------------------------------------------------------------------------
Working capital (deficiency).............. $ 5,617,286 $ (3,348,451) $ 11,319,107 $ 8,738,820 $ 6,847,137
Total assets.............................. 19,664,666 22,375,168 28,909,786 42,121,334 49,063,197
Long-term debt............................ - - 3,689,055 4,631,377 5,847,659
Stockholders' equity (deficit)............ 6,809,481 (232,770) 11,761,997 11,676,769 12,888,384
</TABLE>
15
<PAGE>
(1) Effective October 1, 1994, the Company acquired all the outstanding shares
of Meadow Valley Contractors, Inc. ("MVC") in a transaction accounted for
by the purchase method of accounting whereby the basis of certain assets
was revalued for accounting purposes. To arrive at this proforma
presentation, the MVC financial statements for the 1994 period prior to
October 1, 1994 have been combined with the Company's financial statements
for the period ending December 31, 1994. See Note 2 to the Company's
Consolidated Financial Statements.
(2) Includes the effect of proforma income tax adjustments reflecting
additional income taxes that would have been reported had MVC been subject
to federal and state income taxes for the periods presented through
September 30, 1994. Prior to October 1, 1994, MVC was a S Corporation
and, therefore, did not pay income taxes.
(3) The average shares outstanding and net income (loss) per share are computed
upon the number of shares of the Company's Common Stock outstanding as of
December 31, 1994, including the assumed issuance of 500,000 shares of
restricted Common Stock in the MVC acquisition, which were issued during
October 1995.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
GENERAL
The following is a summary of certain information contained in this Report
and is qualified in its entirety by the detailed information and financial
statements that appear elsewhere herein. Except for the historical information
contained herein, the matters set forth in this Report include forward-looking
statements within the meaning of the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995. These forward-looking statements are
subject to risks and uncertainties that may cause actual results to differ
materially. These risks and uncertainties are detailed throughout the Report and
will be further discussed from time to time in the Company's periodic reports
filed with the Commission. The forward-looking statements included in the Report
speak only as of the date hereof.
The Company was incorporated in Nevada on September 15, 1994. On October 1,
1994, the Company purchased all of the outstanding Common Stock of Meadow Valley
Contractors, Inc. ("MVC"), for $11.5 million comprised of a $10 million
promissory note and $1.5 million paid by the issuance of 500,000 restricted
shares of the Company's Common Stock valued at $3.00 per share. MVC was founded
in 1980 as a heavy construction contractor and has been engaged in that activity
since inception. References to the Company's history include the history of MVC.
The Company is a heavy construction contractor specializing since 1980 in
structural concrete construction of highway bridges and overpasses and the
paving of highways and airport runways. The Company generally serves as the
prime contractor for public sector customers (such as federal, state and local
governmental authorities) in the states of Nevada, Arizona, Utah and New Mexico.
The Company believes that specializing in structural concrete construction has
contributed significantly to its revenue growth and provides it with an
advantage in the competitive bidding process. However, such specialization
limits the types and sizes of projects upon which the Company bids and may be a
competitive disadvantage for projects in which the amount of work proposed to be
completed by the prime contractor (as compared to the amount of work which will
be subcontracted by the prime contractor) is a consideration in the bidding
process. The Company primarily seeks public sector customers because public
sector projects are less cyclical than private sector projects, payment is more
reliable, work required by the project is generally standardized and little
marketing expense is incurred in obtaining projects.
In 1996, the Company acquired certain assets of AKR Contracting ("AKR"), an
unaffiliated Company in Phoenix, Arizona. AKR specializes in earthwork, grading
and paving of residential subdivisions, commercial centers and has become
increasingly involved in small publicly funded projects in Arizona and New
Mexico. Through AKR, the Company entered into operating leases for a portable
hot mix asphalt plant and related paving equipment and a rubberized asphalt
plant. The asphalt paving capabilities provide the Company the opportunity to
expand its existing geographic market. The Company believes increased
competitiveness and revenues will be generated on projects that call for large
quantities of asphaltic concrete, recycled asphalt or rubberized asphalt.
16
<PAGE>
In 1996, the Company formed Ready Mix, Inc. ("RMI") as a wholly-owned
subsidiary. RMI manufactures and distributes ready-mix concrete in Las Vegas,
NV, and targets markets such as concrete subcontractors, prime contractors, home
builders, commercial and industrial property developers, pool builders and
homeowners. RMI began operations from its first location in March 1997. Financed
with internal funds, a $2 million line of credit, notes payable and operating
leases, the Company intends for RMI to operate from two sites using at least 40
mixer trucks.
In 1996, the Company formed Prestressed Products Incorporated ("PPI") as a
wholly-owned subsidiary. PPI designs, manufactures and erects precast
prestressed concrete building components for use on commercial, institutional
and public construction projects throughout the Southwest. Product lines include
architectural and structural building components and prestressed bridge girders
for highway construction. During 1997, PPI began operations with a precast yard
and concrete batch plant located on leased property adjacent to the Company's
office in Moapa, Nevada.
During 1997, financed through internal funds and operating leases, the
Company obtained equipment and experienced personnel to enter the concrete or
"white" paving market. By performing white paving work, the Company may be able
to increase its project revenue and earnings, reduce reliance on white paving
subcontractors and improve the likelihood of being awarded projects in which the
amount of work proposed to be completed on a project by the prime contractor is
a consideration in the competitive bidding process.
The Company has historically relied upon a small number of projects to
generate a significant portion of its revenue. For instance, revenue generated
from six projects represented 56% of the Company's revenue for the year ended
December 31, 1997. Results for any one calender quarter may fluctuate widely
depending upon the stage of completion of the Company's active projects.
RESULTS OF OPERATIONS
The following table sets forth statement of operations data expressed as a
percentage of revenues for the periods indicated:
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
---------------------------
1995 1996 1997
---- ---- ----
<S> <C> <C> <C>
Revenues.............................. 100.00% 100.00% 100.00%
Cost of contract revenues............. 95.16 97.90 95.04
Gross profit.......................... 4.84 2.10 4.96
General and administrative expenses... 2.21 2.35 3.71
Income (loss) from operations......... 2.63 (.25) 1.25
Interest income....................... .52 .56 .44
Interest expense...................... (1.24) (.46) (.42)
Other income.......................... .07 .07 .01
Prior offering costs.................. (.19) - -
Income (loss) before income taxes..... 1.79 (.08) 1.29
Net income (loss) after income taxes.. 1.18 (.06) .81
</TABLE>
YEAR ENDED DECEMBER 31, 1997 COMPARED TO YEAR ENDED DECEMBER 31, 1996
Revenue and Backlog. Revenue increased 12% to $150.0 million for the year
ended December 31, 1997, from $133.7 million for the year ended December 31,
1996. The increase results primarily from a $12.0 million increase in revenue
generated from construction materials production and manufacturing sold to non-
affiliates.
17
<PAGE>
Gross Profit. As a percentage of revenue, gross profit increased from 2.10%
in 1996 to 4.96% in 1997. The increase results primarily from an increase in
MVCI and RMI combined gross profit margins from 2.10% in 1996 to 5.38% in 1997
or an increase of 156%, offset by a gross loss of 11.5% related to the precast
operations of PPI. The gross loss related to the precast operations of PPI were
he result of (i) sales, marketing, estimating, administrative and organizational
costs preliminary to revenue generation (ii) staffing and training production
crews and related loss of productivity (iii) non-compensable differences between
preliminary (pre-bid) and final designs of PPI (iv) a compressed completion
schedule creating extraordinary increases in the number of personnel, compounded
by poor productivity of inexperienced crews requiring an inordinate amount of
overtime. Gross profit margins can be affected by construction delays and
difficulties due to weather conditions, availability of materials, the timing of
work performed by other subcontractors and the physical and geological condition
of the construction site.
General and Administrative Expenses. General and administrative expenses
increased from $3,142,110 for 1996 to $5,566,986 for 1997. The increase results,
in part, from the costs associated with the Company's wholly-owned ready-mix
concrete and precast/prestressed products subsidiaries, the Company's continued
expansion in the Utah market and expansion into the white paving market. The
additional costs associated with the Company's wholly-owned ready-mix concrete
and precast/prestressed products subsidiaries and the continued expansion in the
Utah market and expansion into the white paving market amounted to approximately
$1,684,000. The remainder of the increase was $365,948 in corporate labor and a
variety of costs including costs in excess of $79,000 related to enhancements in
the safety plan, $75,000 related to non-recurring consulting studies and $53,000
related to corporate travel.
Interest Income and Expense. Interest income decreased in 1997 to $666,397
from $741,270 due to a decrease in cash reserves resulting primarily from the
expansion into the production and manufacturing of construction materials and
the purchase of equipment. Interest expense increased slightly in 1997 to
$624,048 from $611,828, due primarily to financing certain of the property and
equipment additions.
Net Income (Loss) After Income Taxes. Net income after taxes for 1997 was
$1,211,615 compared to a net loss after income taxes for 1996 of $(85,228). The
increase primarily resulted from the increase in revenue and gross profit margin
offset, in part, by higher general and administrative expenses as discussed
above.
YEAR ENDED DECEMBER 31, 1996 COMPARED TO YEAR ENDED DECEMBER 31, 1995
Revenue and Backlog. Revenue increased 48.5% to $133.7 million for the year
ended December 31, 1996, from $90.0 million for the year December 31, 1995. The
increase results primarily from a $30.0 million increase in backlog at December
31, 1995 over the prior year and the award of approximately $100 million of
projects during the first nine months of 1996, compared to approximately $58
million during the same period in 1995. In addition, the Company's expansion
into earthwork, grading and paving of residential subdivisions, commercial
centers and in small public works, through the acquisition of certain assets of
AKR, contributed approximately $11.2 million to the Company's overall revenue
growth. Revenue is impacted in any one period by the backlog at that beginning
of that period.
Gross Profit. As a percentage of revenue, gross profit decreased from 4.84%
in 1995 to 2.10% in 1996. The decrease results primarily from cost overruns
attributable to (i) omission of costs from bid estimates (ii) difficulty in
assembling an adequate skilled labor force due to physical location of a
construction site (iii) erroneous assumptions at bid time regarding the
Company's construction productivity (iv) cost related plan or specification
errors and (v) inadequate field and corporate supervision, offset by a 2.2%
increase in gross profit margins due to the settlement of a claim which is
related to a project completed during 1995. Gross profit margins can be affected
by construction delays and difficulties due to weather conditions, availability
of materials, the timing of work performed by other subcontractors and the
physical and geological condition of the construction site.
General and Administrative Expenses. General and administrative expenses
increased from $1,989,779 for 1995 to $3,142,110 for 1996. The increase results,
in part, from the start-up costs associated with the Company's development stage
subsidiaries, the Company's expansion in the Utah market and, through AKR,
expansion into earthwork, grading and paving of residential subdivisions,
commercial centers and small publicly funded projects. The additional costs
associated with the development stage companies, expansion in the Utah market
and AKR amounted to $719,572, consisting primarily of salaries and office set up
costs. In addition to the start-up costs, the Company sustained increased
general and administrative expenses due to the 48.5% growth in revenue.Interest
Income and Expense. Interest income increased in 1996 to $741,270 from $470,150
18
<PAGE>
due to invested proceeds from the Public Offering and increased funds held in
retention. Interest expense decreased in 1996 to $611,828 due to the November
1995 repayment of $6.5 million of loans issued in connection with the
acquisition of Meadow Valley Contractors, Inc.
Net Income (Loss) After Income Taxes. Net loss after income taxes for 1996
was $(85,228) compared to net income of $1,059,347 for 1995. The decrease
resulted primarily from the lower gross profit and higher general and
administrative expenses discussed above.
LIQUIDITY AND CAPITAL RESOURCES
The Company's primary need for capital has been to finance growth in its
core business as a heavy construction contractor and its expansion into the
other construction and construction related businesses heretofore discussed.
Annual revenue has grown from approximately $90.0 million in 1995 to $150.0
million in 1997. Growth has resulted in the need for additional capital to
finance increased receivables, retentions and capital expenditures, and to
address fluctuations in the work-in-process billing cycle.
The following table sets forth, for the periods presented, certain items
from the Statements of Cash Flows of the Company.
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
-----------------------------------------
1995 1996 1997
---- ---- ----
<S> <C> <C> <C>
Cash Provided By (Used in) Operating Activities........ $(1,789,928) $(3,085,632) 5,967,880
Cash Used in Investing Activities...................... (527,120) (584,470) (2,816,474)
Cash Provided By (Used in) Financing Activities........ 2,935,528 (247,283) (1,738,860)
</TABLE>
Although the Company may experience increased profitability as operations
increase, cash may be reduced to finance receivables and for customer cash
retention required under contracts subject to completion. Management continually
monitors the Company's cash requirements to maintain adequate cash reserves, and
the Company believes that its cash balances were and, together with the
operating lines of credit described below, are sufficient.
Cash used in operating activities during 1995amounted to $1.8 million,
primarily the result of an increase in accounts receivable and net costs in
excess of billings of $5.5 million, offset by net income of $1.0 million,
depreciation and amortization of $.4 million and an increase in accounts
payable $2.2 million.
Cash used in operating activities during 1996 amounted to $3.1 million,
primarily the result of an increase in accounts receivable and prepaid expenses
of $14.1 million, offset by an increase in accounts payable of $8.6 million
along with an increase in net billings in excess of costs of $1.6 million and
depreciation and amortization of $.8 million.
Cash provided by operating activities during 1997 amounted to $6.0 million,
primarily the result of net income of $1.2 million, depreciation and
amortization of $1.4 million, a decrease in accounts receivable of $.7 million,
an increase in net billings in excess of costs $2.3 million and a $.4 million
decrease in deferred income tax payable.
Cash used in investing activities during 1995 included the purchase of
property and equipment of $1.4 million offset by a decrease in restricted cash
of $.3 million and repayment of $.6 million of loans to related parties.
Cash used in investing activities during 1996 amounted to $.6 million,
primarily the result of the purchase of property and equipment of $1.9 million
offset by a decrease in restricted cash of $1.2 million and proceeds from the
sale of property and equipment of $.1 million. The decrease in restricted cash
during 1995 and 1996 is a result of the partial release of funds held in escrow
accounts pending the completion of three large volume projects.
Cash used in investing activities during 1997 amounted to $2.8 million
related primarily to equipment purchases.
19
<PAGE>
Cash provided by financing activities during 1995 amounted to approximately
$3.0 million and included proceeds from the initial public offering of the
Company's securities in the amount of $9.5 million, net of offering costs,
offset by repayment of $6.5 million of loans from a related party issued in
connection with the MVC acquisition. Cash used in financing activities during
1996 included lease payments of $.1 million and equipment loan payments of $.1
million, a total of approximately $.2 million. Cash used in financing activities
during 1997 amounted to $1.7 million including $.5 million repayment of a loan
from a related party and $.5 million prepayment of a loan from a related party
and repayments of notes payable and capital lease obligations in the amount of
$.7 million.
The Company currently has available from a commercial bank a $2,000,000
operating line of credit at an interest rate of the commercial bank's prime plus
.50%, and a $2,000,000 operating line of credit at an interest rate of the
commercial bank's prime plus .25% ("lines of credit"). At December 31, 1997, and
as of the filing date of this report, nothing had been drawn on either of the
lines of credit. Under the lines of credit, the Company is required to maintain
certain levels of working capital, to promptly pay all its obligations and is
precluded from conveying, selling or leasing all or substantially all of its
assets. At December 31, 1997, the Company was in full compliance with all such
covenants and there are no material covenants or restrictions in the lines of
credit which the Company believes would impair its operations. The lines of
credit expire September 15, 1998.
The Company anticipates that a substantial portion of the costs associated
with a planned second ready-mix plant and related equipment will be financed
through bank financing and operating leases. In addition, the Company is
currently leasing approximately 40 ready-mix trucks with estimated annual lease
payments of $800,000.
Management believes that the Company's cash reserves, together with its
lines of credit and its capacity to enter into other financing arrangements are
sufficient to fund its cash requirements for the next 12 months and that the
Company's working capital will be adequate to fund its short term and long term
requirements.
NEW ACCOUNTING PRONOUNCEMENTS
Accounting for Stock-Based Compensation:
Statements of Financial Accounting Standards No. 123, "Accounting for
Stock-Based Compensation" ("SFAS No. 123") establishes a fair value method of
accounting for stock-based compensation plans and for transactions in which an
entity acquires goods or services from nonemployees in exchange for equity
instruments. The Company adopted this accounting standard January 1, 1996. SFAS
123 also encourages, but does not require companies to record compensation cost
for stock-based employee compensation. The Company has chosen to continue to
account for stock-based compensation utilizing the intrinsic value method
prescribed in Accounting Principles Board Opinion No. 25, "Accounting for Stock
Issued to Employees." Accordingly, compensation cost for stock options is
measured as the excess, if any, of the fair market price of the Company's stock
at the date of grant over the amount an employee must pay to acquire the stock.
Earnings per Share:
Statement of Financial Accounting Standards No. 128, "Earnings per Share,"
("SFAS 128") issued by the FASB is effective for financial statements with
fiscal years and interim periods beginning after December 15, 1997. Early
adoption is not permitted. SFAS 128 provides for the calculation of Basic and
Diluted earnings per share. Basic earnings per share includes no dilution and is
computed by dividing income available to common shareholders by the weighted
average number of common shares outstanding for the period. Diluted earnings per
share reflects the potential dilution of securities that could share in the
earnings of an entity, similar to fully diluted earning per share. The Company
adopted this accounting standard on December 15, 1997.
Disclosure of Information about Capital Structure:
Statement of Financial Accounting Standard No. 129, "Disclosure of
Information about Capital Structure," ("SFAS 129") issued by the FASB is
effective for financial statements ended December 15, 1997. The new standard
reinstates various securities disclosure requirements previously in effect under
Accounting Principles Board Opinion No. 15, which has been superseded by SFAS
No. 128. The Company does not expect adoption of SFAS No. 129 to have a material
effect, if any, on its financial position or results of operations.
20
<PAGE>
Reporting Comprehensive Income:
Statement of Financial Accounting Standard No. 130, "Reporting
Comprehensive Income," ("SFAS 130") issued by the FASB is effective for
financial statements with fiscal years beginning after December 15, 1997.
Earlier application is permitted. SFAS 130 establishes standards for reporting
and display of comprehensive income and its components in a full set of general-
purpose financial statements. The Company does not expect adoption of SFAS 130
to have a material effect, if any, on its financial position or results of
operations.
Disclosures about Segments of an Enterprise and Related Information:
Statement of Financial Accounting Standards No. 131, "Disclosures about
Segments of an Enterprise and Related Information," ("SFAS 131") issued by the
FASB is effective for financial statements with fiscal years beginning after
December 15, 1997. Earlier application is permitted. SFAS 131 requires that
public companies report certain information about operating segments, products,
services and geographical areas in which they operate and their major customers.
The Company does not expect adoption of SFAS 131 to have a material effect, if
any, on its financial position or results of operations.
IMPACT OF INFLATION
The Company believes that inflation has not had a material impact on its
operations. However, substantial increases in labor costs, worker compensation
rates and employee benefits, equipment costs, material or subcontractor costs
could adversely affect the operations of the Company for future periods.
YEAR 2000
The Company's accounting software currently does not utilize a four digit
year field; however, the Company has been assured by the software manufacturer
that all necessary modifications for the year 2000 have been or will be made and
tested timely.
KNOWN AND ANTICIPATED FUTURE TRENDS AND CONTINGENCIES
Subject to the Company's profitability and increases in retained earnings,
it is anticipated that the bonding limits will increase proportionately, thereby
allowing the Company to bid on and perform more and larger projects.
The Company believes that government of all levels will continue to be the
primary source of funding for infrastructure work. The reauthorization of the
ISTEA bill is essential to the well-being of the industry and the Company. "See
Market Overview".
The competitive bidding process will continue to be the dominant method for
determining contract award. However, other innovative bidding methods will be
tried and may gain favor, namely "A Plus B" contracts, where the bidders'
proposals are selected on both price and scheduling criteria. Design-build
projects are becoming more common and are likely to increase in frequency.
Design-build projects also tend to be of more worth to the owner when the
contract size is substantial, usually $50 million or more.
In light of the rising needs for infrastructure work throughout the nation
and the tendency of the current needs to out-pace the supply of funds, it is
anticipated that alternative funding sources will continue to be sought. Funding
for infrastructure development in the United States is coming from a growing
variety of innovative sources. An increase of funding measures is being
undertaken by various levels of government to help solve traffic congestion and
related air quality problems. Sales taxes, fuel taxes, user fees in a variety of
forms, vehicle license taxes, private toll roads and quasi-public toll roads are
examples of how transportation funding is evolving. Transportation norms are
being challenged by federally mandated air quality standards. Improving traffic
movement, eliminating congestion, increasing public transit, adding or
designating high occupancy vehicle (HOV) lanes to encourage car pooling and
other solutions are being considered in order to help meet EPA-imposed air
quality standards.
21
<PAGE>
SEASONALITY
The construction industry is seasonal, generally due to inclement weather
occurring in the winter months. Accordingly, the Company may experience a
seasonal pattern in its operating results with lower revenue in the first and
fourth quarters of each calendar year than other quarters. Quarterly results may
also be affected by the timing of bid solicitations by governmental authorities,
the stage of completion of major projects and revenue recognition policies.
Results for any one quarter, therefore, may not be indicative of results for
other quarters or for the year.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The Company's Consolidated Financial Statements are indexed on page F-1.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
Not Applicable
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Information on directors and executive officers of the Company will be
included under the caption "Directors and Executive Officers" of the Company's
definitive Proxy Statement relating to the Annual Meeting of Shareholders for
the year ended December 31, 1997, which is hereby incorporated by reference.
ITEM 11. EXECUTIVE COMPENSATION
Information on executive compensation will be included under the caption
"Compensation of Executive Officers" of the Company's definitive Proxy Statement
relating to the Annual Meeting of Shareholders for the year ended December 31,
1997, which is hereby incorporated by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Information on beneficial ownership of the Company's voting securities by
each director and all officers and directors as a group, and by any person known
to beneficially own more than 5% of any class of voting security of the Company
will be included under the caption "Beneficial Ownership of the Company's
Securities" of the Company's definitive Proxy Statement relating to the Annual
Meeting of the Shareholders for the year ended December 31, 1997, which is
hereby incorporated by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Information on certain relationships and related transactions including
information with respect to management indebtedness will be included under the
caption "Information Regarding Indebtedness of Management to the Company" of the
Company's definitive Proxy Statement relating to the Annual Meeting of
Shareholders for the year ended December 31, 1997, which is hereby incorporated
by reference.
22
<PAGE>
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a)(1) Financial Statements
See Item 8 of Part II hereof.
(a)(2) Financial Statement Schedules
The schedules specified under Regulation S-X are either not
applicable or immaterial to the Company's consolidated financial
statements for the years ended December 31, 1995, 1996 and 1997.
(b) Reports on Form 8-K
There were no reports on Form 8-K filed during the fourth quarter
ended December 31, 1997.
(c) Exhibits
<TABLE>
<CAPTION>
EXHIBIT
NO. TITLE
- ----------- ---------------------------------------------------------------------------------
<S> <C> <C>
1.01 Form of Underwriting Agreement with Spelman & Co., Inc. (1)
1.02 Form of Selected Dealer Agreement (1)
1.03 Form of Representatives' Warrant (1)
1.04 Consulting Agreement with the Representative (1)
1.05 Form of Amended Underwriting Agreement (Spelman & Co., Inc.) (1)
1.06 Form of Amended Representatives' Warrant (Spelman & Co., Inc.)(1)
1.07 Form of Underwriting Agreement (H D Brous & Co., Inc.)(1)
1.08 Form of Selected Dealer Agreement (H D Brous & Co., Inc.)(1)
1.09 Form of Representatives' Unit Warrant (H D Brous & Co., Inc.)(1)
1.10 Warrant Agreement (1)
1.11 Agreement Among Underwriters (1)
1.12 Form of Underwriting Agreement (H D Brous & Co., Inc. and Neidiger/Tucker/Bruner,
Inc.)(1)
1.13 Form of Agreement Among Underwriters (H D Brous & Co., Inc. and
Neidiger/Tucker/Bruner, Inc.)(1)
1.14 Form of Selected Dealer Agreement (H D Brous & Co., Inc. and
Neidiger/Tucker/Bruner, Inc.)(1)
1.15 Form of Representatives' Warrant Agreement, including Form of
Representatives'Warrant (H D Brous & Co., Inc. and Neidiger/Tucker/Bruner, Inc.)(1)
3.01 Articles of Incorporation and Amendments thereto of the Registrant (1)
3.02 Bylaws of the Registrant (1)
3.03 Bylaws of the Registrant Effective October 20, 1995
5.01 Opinion of Gary A. Agron, regarding legality of the Common Stock (includes
Consent)(1)
5.02 Opinion of Gary A. Agron, regarding legality of the Units, Common Stock and
Warrants (1)
10.01 Incentive Stock Option Plan (1)
</TABLE>
23
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO. TITLE
<S> <C> <C>
- ----------- ------------------------------------------------------------------------------------
10.02 Office lease of the Registrant (1)
10.03 Office lease of the Registrant (1)
10.04 Contract between the State of Arizona and the Registrant dated October 22, 1993 (1)
10.05 Surety Bond between the Registrant and St. Paul Fire & Marine Insurance Company (1)
10.06 Surety Bond between the Registrant and United States Fidelity and Guaranty
Company (1)
10.07 Contract between Clark County, Nevada and the Registrant dated October 6, 1992 (1)
10.08 Surety Bond between the Registrant and St. Paul Fire and Marine Insurance
Company (1)
10.09 Agreement between Salt Lake City Corporation and the Registrant dated
May 5, 1993 (1)
10.10 Contract between Clark County, Nevada and the Registrant dated July 21, 1993 (1)
10.11 Contract between Clark County, Nevada and the Registrant dated August 17, 1993 (1)
10.12 Promissory Note executed by Robert C. Lewis and Richard C. Lewis (1)
10.13 Promissory Note executed by Moapa Developers, Inc. (1)
10.14 Promissory Note executed by Paul R. Lewis (1)
10.15 Contract between Clark County, Nevada and the Registrant dated September 7, 1993 (1)
10.16 Agreement between Salt Lake City Corporation and the Registrant dated February 11,
1994 (1)
10.17 Contract between Northwest/Cheyenne Joint Venture and the Registrant dated March
16, 1994 (1)
10.18 Contract between Clark County, Nevada and the Registrant dated April 5, 1994 (1)
10.19 Statutory Payment Bond dated September 8, 1994 (1)
10.20 Employment Agreement with Mr. Lewis (1)
10.21 Employment Agreement with Mr. Black (1)
10.22 Employment Agreement with Mr. Terril (1)
10.23 Employment Agreement with Mr. Nelson (1)
10.24 Employment Agreement with Ms. Danley (1)
10.25 Employment Agreement with Mr. Jessop (1)
10.26 Employment Agreement with Mr. Larson (1)
10.27 Stock Purchase Agreement (1)
10.28 Form of Lockup Letter (1)
10.29 Revolving Credit Loan Agreement (1)
10.30 Contract Award Notification - Arizona Department of Transportation (1)
10.31 Contract Award Notification - McCarran International Airport (1)
10.32 Contract Award Notification - City of Henderson (1)
10.33 Contract between Registrant and Arizona Department of Transportation (1)
10.34 Contract between Registrant and Arizona Department of Transportation (1)
10.35 Office Lease of the Registrant (1)
</TABLE>
24
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO. TITLE
<S> <C> <C>
- ----------- ------------------------------------------------------------------------------------
10.36 Contract between Registrant and Arizona Department of Transportation (2)
10.37 Contract Award Notification - Clark County (2)
10.38 Joint Venture Agreement (2)
10.39 Employment Agreement with Mr. Grasmick (2)
10.40 Contract between Registrant and Clark County, Nevada (2)
10.41 Contract between Registrant and Clark County, Nevada (2)
10.42 Contract between Registrant and Utah Department of Transportation (2)
10.43 Contract between Registrant and Arizona Department of Transportation (2)
10.44 Promissory Note executed by Nevada State Bank (2)
10.45 Escrow Settlement Documents and related Promissory Note (2)
10.46 Conveyor Sales Contract and Security Agreement (2)
10.47 CAT Financial Installment Sale Contract (2)
10.48 Second and Third Amendments to Office Lease of the Registrant (2)
10.49 Lease Agreement with US Bancorp (2)
10.50 Lease Agreement with CIT Group (2)
10.51 CAT Financial Installment Sale Contract
10.52 CAT Financial Installment Sale Contract
10.53 CAT Financial Installment Sale Contract
10.54 CAT Financial Installment Sale Contract
10.55 CAT Financial Installment Sale Contract
10.56 Escrow Settlement Documents
10.57 Promissory Note executed by General Electric Capital Corporation
10.58 Promissory Note executed by General Electric Capital Corporation
10.59 Promissory Note executed by General Electric Capital Corporation
10.60 Promissory Note executed by General Electric Capital Corporation
10.61 Promissory Note executed by Nevada State Bank
10.62 KDC Sales Contract
10.63 Lease Agreement with CIT
10.64 Lease Agreement with CIT
10.65 Contract between Registrant and Utah Department of Transportation
10.66 Contract between Registrant and Clark County, Nevada
10.67 Contract between Registrant and New Mexico State Highway and Transportation
Department
10.68 Contract between Registrant and Salt Lake City Corporation
10.69 Contract between Registrant and Utah Department of Transportation
10.70 Contract between Registrant and Arizona Department of Transportation
10.71 Contract between Registrant and Nevada Department of Transportation
10.72 Employment and Indemnification Agreements with Mr. Nelson
</TABLE>
25
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO. TITLE
- ----------- ------------------------------------------------------------------------------------
<S> <C> <C>
10.73 Employment and Indemnification Agreements with Mr. Terril
10.74 Employment and Indemnification Agreements with Mr. Lewis
10.75 Employment and Indemnification Agreements with Mr. Larson
10.76 Employment and Indemnification Agreements with Mr. Burnell
16.01 Letter re: Change in Certifying Accountant (1)
21.01 Subsidiaries of the Registrant (1)
23.01 Consent of Semple & Cooper (Meadow Valley Contractors, Inc.)(1)
23.02 Consent of Semple & Cooper (Meadow Valley Corporation)(1)
23.03 Consent of Gary A. Agron, Esq. (See 5.01, above.)(1)
23.04 Consent of Semple & Cooper (Meadow Valley Contractors, Inc.)(1)
23.05 Consent of BDO Seidman LLP (Meadow Valley Corporation)(1)
23.06 Consent of Semple & Cooper (Meadow Valley Contractors, Inc.)(1)
23.07 Consent of BDO Seidman LLP (Meadow Valley Corporation) (1)
23.08 Consent of Semple & Cooper (Meadow Valley Contractors, Inc.)(1)
23.09 Consent of BDO Seidman LLP (Meadow Valley Corporation and Meadow Valley
Contractors, Inc.)(1)
23.10 Consent of Semple & Cooper (Meadow Valley Contractors, Inc.)(1)
23.11 Consent of BDO Seidman LLP (Meadow Valley Corporation and Meadow Valley
Contractors, Inc.)(1)
23.12 Consent of Semple & Cooper (Meadow Valley Contractors, Inc.)(1)
23.13 Consent of BDO Seidman LLP (Meadow Valley Corporation and Meadow Valley
Contractors, Inc.)(1)
23.14 Consent of Semple & Cooper (Meadow Valley Contractors, Inc.)(1)
23.15 Consent of DO Seidman LLP (Meadow Valley Corporation and Meadow Valley
Contractors, Inc.)(1)
27 Financial Data Schedule
</TABLE>
- -----------------
(1) Incorporated by reference to the Company's Registration Statement on Form
S-1, File Number 33-87750 declared effective on October 16, 1995.
(2) Incorporated by reference to the Company's December 31, 1996 Annual Report
on Form 10-K.
26
<PAGE>
Pursuant to the requirements of Section 13 or 15(d) 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
<TABLE>
<CAPTION>
<S> <C>
MEADOW VALLEY CORPORATION
/s/ Bradley E. Larson
-------------------------------------
Bradley E. Larson
President and Chief Executive Officer
Date: March 13, 1998
</TABLE>
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
<S> <C>
/s/ Bradley E. Larson /s/ Gary W. Burnell
- ----------------------------------------------- -------------------------------------
Bradley E. Larson, Gary W. Burnell,
Director, President and Chief Executive Officer Vice President, Treasurer and Chief Financial Officer
Date: March 13, 1998 Date: March 13, 1998
/s/ Kenneth D. Nelson /s/ Paul R. Lewis
- ----------------------------------------------- -------------------------------------
Kenneth D. Nelson, Paul R. Lewis,
Director, Chief Administrative Officer and Director and Chief Operating Officer
Vice President Date: March 13, 1998
Date: March 13, 1998
/s/ Alan A. Terril /s/ Gary A. Agron
- ----------------------------------------------- -------------------------------------
Alan A. Terril, Gary A. Agron,
Director and Vice President - Nevada Operations Director
Date: March 13, 1998 Date: March 13, 1998
/s/ Charles E. Cowan /s/ Scott E. Miller
- ----------------------------------------------- -------------------------------------
Charles E. Cowan, Scott E. Miller,
Director Director
Date: March 13, 1998 Date: March 13, 1998
/s/ Julie L. Bergo
- -----------------------------------------------
Julie L. Bergo,
Secretary and Principal Accounting Officer
Date: March 13, 1998
</TABLE>
27
<PAGE>
INDEX TO FINANCIAL STATEMENTS
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
<TABLE>
<CAPTION>
<S> <C>
Independent Certified Public Accountants' Report................................................. F-2
Consolidated Balance Sheets at December 31, 1996 and 1997........................................ F-3
Consolidated Statements of Operations for the years ended December 31, 1995, 1996, and 1997...... F-4
Consolidated Statements of Changes in Stockholders' Equity for the years ended December 31,
1995, 1996 and 1997............................................................................. F-5
Consolidated Statements of Cash Flows for the years ended December 31, 1995, 1996 and 1997...... F-6
Notes to Consolidated Financial Statements....................................................... F-8
</TABLE>
F-1
<PAGE>
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS' REPORT
To the Stockholders and Board of Directors of
Meadow Valley Corporation
We have audited the accompanying consolidated balance sheets of Meadow Valley
Corporation and Subsidiaries as of December 31, 1996 and 1997, and the related
consolidated statements of operations, changes in stockholders' equity and cash
flows for each of the three years ended December 31, 1995, 1996 and 1997. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.
We conducted our audits in accordance with generally accepted audit standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the consolidated financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the consolidated financial statements.
An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall consolidated
financial statement presentation. We believe our audits of the consolidated
financial statements provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of Meadow
Valley Corporation and Subsidiaries as of December 31, 1996 and 1997, and the
consolidated results of their operations, and cash flows for each of the three
years ended December 31, 1995, 1996 and 1997, in conformity with generally
accepted accounting principles.
BDO Seidman, LLP
Los Angeles, California
February 19, 1998
F-2
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31,
Assets: 1996 1997
-----------------------------
<S> <C> <C>
Current Assets:
Cash and cash equivalents (Notes 1 and 3).................................... $ 1,440,519 $ 2,853,065
Restricted cash (Notes 1 and 3).............................................. 1,415,577 1,719,768
Accounts receivable, net (Notes 1, 4 and 18)................................. 26,861,458 26,244,473
Prepaid expenses and other................................................... 836,086 925,923
Note receivable - related party (Notes 12 and 22)............................ 257,575 257,575
Note receivable - other (Note 11)............................................ 1,855 2,009
Costs and estimated earnings in excess of billings on uncompleted
contracts (Note 5)........................................................ 3,726,328 4,758,917
-----------------------------
Total Current Assets............................................... 34,539,398 36,761,730
Property and equipment, net (Notes 1, 6, 9 and 12)................................ 5,278,390 10,211,468
Refundable deposits............................................................... 247,740 127,737
Note receivable - other (Note 11)................................................. 210,602 209,264
Goodwill, net (Note 1)............................................................ 1,820,850 1,740,821
Tradename, net (Note 1)........................................................... 24,354 12,177
-----------------------------
Total Assets...................................................... $42,121,334 $49,063,197
=============================
Liabilities and Stockholders' Equity:
Current Liabilities:
Notes payable - related party (Notes 2 and 12)............................... $ 500,000 $ 500,000
Notes payable - other (Note 9)............................................... 266,220 818,846
Obligations under capital leases (Note 14)................................... 254,364 405,204
Accounts payable (Notes 7 and 12)............................................ 19,629,807 19,536,421
Accrued liabilities (Notes 8 and 12)......................................... 1,777,334 1,993,182
Billings in excess of costs and estimated earnings on uncompleted
contracts (Note 5)......................................................... 3,372,853 6,660,940
-----------------------------
Total Current Liabilities......................................... 25,800,578 29,914,593
Deferred income taxes (Notes 1 and 13)............................................ 12,610 412,561
Obligations under capital leases (Note 14)........................................ 643,910 973,847
Note payable - related party (Notes 2 and 12)..................................... 3,000,000 2,000,000
Notes payable - other (Note 9).................................................... 987,467 2,873,812
-----------------------------
Total Liabilities.................................................. 30,444,565 36,174,813
-----------------------------
Commitments and contingencies (Notes 12, 14 and 16)
Stockholders' Equity:
Preferred stock - $.001 par value; 1,000,000 shares authorized, none issued
and outstanding (Note 15)..................................................
Common stock - $.001 par value; 15,000,000 shares authorized, 3,601,250
Issued and outstanding (Notes 15 and 19)................................... 3,601 3,601
Additional paid-in capital................................................... 10,943,569 10,943,569
Capital adjustments (Note 2)................................................. (799,147) (799,147)
Retained earnings............................................................ 1,528,746 2,740,361
-----------------------------
Total Stockholders' Equity......................................... 11,676,769 12,888,384
-----------------------------
Total Liabilities and Stockholders' Equity......................... $42,121,334 $49,063,197
=============================
</TABLE>
The Accompanying Notes are an Integral Part of the Consolidated Financial
Statements
F-3
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
1995 1996 1997
----------------------------------------------
<S> <C> <C> <C>
Contract Revenues (Note 18)....................... $90,048,523 $133,723,645 $149,979,395
Cost of Contract Revenues (Note 12)............... 85,694,068 130,913,060 142,544,451
----------------------------------------------
Gross Profit (Note 21)............................ 4,354,455 2,810,585 7,434,944
General and Administrative Expenses............... 1,989,779 3,142,110 5,566,986
----------------------------------------------
Income (loss) from Operations (Note 21)........... 2,364,676 (331,525) 1,867,958
----------------------------------------------
Other Income (Expense):
Interest income................................... 470,150 741,270 666,397
Interest expense (Note 12)........................ (1,116,464) (611,828) (624,048)
Other income...................................... 63,635 95,220 20,679
Offering costs written off........................ (173,000) - -
----------------------------------------------
(755,679) 224,662 63,028
----------------------------------------------
Income (loss) before income taxes................. 1,608,997 (106,863) 1,930,986
Income tax (expense) benefit (Note 13)............ (549,650) 21,635 (719,371)
----------------------------------------------
Net Income (loss)................................. $ 1,059,347 $ (85,228) $ 1,211,615
==============================================
Basic Net Income (loss) per common share.......... $.65 $(.02) $.34
==============================================
Diluted Net income (loss) per common share........ $.65 $(.02) $.33
==============================================
Basic Weighted Average Common Shares Outstanding
(Note 20)........................................ 1,641,663 3,601,250 3,601,250
==============================================
Diluted Weighted Average Common Shares Outstanding
(Note 20)....................................... 1,641,663 3,601,250 3,651,360
==============================================
</TABLE>
The Accompanying Notes are an Integral Part of the Consolidated Financial
Statements
F-4
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE YEARS ENDED DECEMBER 31, 1995, 1996 AND 1997
<TABLE>
<CAPTION>
COMMON STOCK
----------------------
NUMBER OF
SHARES PAID-IN CAPITAL RETAINED
OUTSTANDING VALUE CAPITAL ADJUSTMENT EARNINGS
-------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Balance at December 31, 1994........... 1,175,000 $1,175 $ 10,575 $(799,147) $ 554,627
Sale of Units to the public (Note 15).. 1,926,250 1,926 9,433,494
Issuance of common stock (Note 2)...... 500,000 500 1,499,500
Net income for the year................ 1,059,347
---------------------------------------------------------------
Balance at December 31, 1995........... 3,601,250 3,601 10,943,569 (799,147) 1,613,974
Net loss for the year.................. (85,228)
---------------------------------------------------------------
Balance at December 31, 1996........... 3,601,250 3,601 10,943,569 (799,147) 1,528,746
Net income for the year................ 1,211,615
---------------------------------------------------------------
Balance at December 31, 1997........... 3,601,250 $3,601 $10,943,569 $(799,147) $2,740,361
===============================================================
</TABLE>
The Accompanying Notes are an Integral Part of the Consolidated Financial
Statements
F-5
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
----------------------------------------------
1995 1996 1997
----------------------------------------------
<S> <C> <C> <C>
Increase (Decrease) in Cash and Cash Equivalents:
Cash flows from operating activities:
Cash received from customers.............................. $ 84,602,809 $ 122,322,752 $ 152,899,056
Cash paid to suppliers and employees...................... (85,317,317) (124,394,729) (146,785,012)
Interest received......................................... 459,997 685,738 615,008
Interest paid............................................. (1,195,119) (642,344) (658,622)
Income taxes paid......................................... (340,298) (1,057,049) (102,550)
Net cash provided by (used in) operating activities.. (1,789,928) (3,085,632) 5,967,880
----------------------------------------------
Cash flows from investing activities:
Purchase of AKR Contracting tradename..................... - (36,531) -
Decrease (increase) in restricted cash.................... 316,996 1,213,972 (304,191)
Collection of notes receivable - related party............ 600,000 - -
Collection of note receivable - other..................... - 876 1,184
Additional cost of acquisition............................ (136,058) - -
Proceeds from sale of property and equipment.............. 86,202 126,431 322,960
Proceeds from sale of rental real estate.................. - 16,866 -
Purchase of property and equipment........................ (1,175,377) (1,906,084) (2,836,427)
Purchase of real estate................................... (218,883) - -
Net cash used in investing activities................ (527,120) (584,470) (2,816,474)
----------------------------------------------
Cash flows from financing activities:
Deferred offering costs................................... (1,166,498) - -
Proceeds from sale of units to public..................... 10,633,000 - -
Repayment of capital lease obligations.................... (30,974) (124,333) (319,428)
Repayment of notes payable - other........................ - (122,950) (419,432)
Repayment of note payable - related party................. (6,500,000) - (1,000,000)
Net cash provided by (used in) financing activities.. 2,935,528 (247,283) (1,738,860)
----------------------------------------------
Net increase (decrease) in cash and cash equivalents........... 618,480 (3,917,385) 1,412,546
Cash and cash equivalents at beginning of period............... 4,739,424 5,357,904 1,440,519
Cash and cash equivalents at end of period..................... $ 5,357,904 $ 1,440,519 $ 2,853,065
==============================================
</TABLE>
The Accompanying Notes are an Integral Part of the Consolidated Financial
Statements
F-6
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
-------------------------------------------
1995 1996 1997
-------------------------------------------
<S> <C> <C> <C>
Increase (Decrease) in Cash and Cash Equivalents
(Continued):
Reconciliation of Net Income (Loss) to Net Cash Provided by
(used in) Operating Activities:
Net Income (loss)............................................ $ 1,059,347 $ (85,228) $ 1,211,615
Adjustments to reconcile net income to net cash provided by
(used in) operating activities:
Depreciation and amortization........................... 367,015 769,173 1,356,504
Gain on sale of property and equipment.................. (17,913) (38,170) (24,890)
Gain on sale of rental real estate...................... - (11,316) -
Offering costs written off.............................. 173,000 - -
Changes in Assets and Liabilities, net of acquisition of
subsidiary:
Accounts receivable..................................... (4,026,929) (13,095,536) 668,374
Prepaid expenses and other.............................. 17,037 (968,247) (187,115)
Costs and estimated earnings in excess of billings on
uncompleted contracts................................. (1,647,081) (1,005,150) (1,032,589)
Interest payable........................................ (78,655) (30,516) (34,574)
Accounts payable........................................ 2,155,191 8,644,352 (93,386)
Accrued liabilities..................................... (188,168) 767,429 250,422
Billings in excess of costs and estimated earnings on
uncompleted contracts................................. 182,574 2,654,059 3,288,087
Interest receivable..................................... 5,302 (55,532) (51,389)
Income tax receivable................................... - - 216,870
Income tax payable...................................... 269,017 (609,315) -
Deferred income tax payable............................. (59,665) (21,635) 399,951
-------------- ------------ -----------
Net cash provided by (used in) operating activities.......... $(1,789,928) $ (3,085,632) $ 5,967,880
-------------------------------------------
</TABLE>
The Accompanying Notes are an Integral Part of the Consolidated Financial
Statements
F-7
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Nature of the Corporation:
Meadow Valley Corporation (the "Company") was organized under the laws of the
State of Nevada on September 15, 1994. The principal business purpose of the
Company is to operate as the holding Company of Meadow Valley Contractors, Inc.
(MVC), Ready Mix, Inc. (RMI) and Prestressed Products Incorporated (PPI). MVC
is a general contractor, primarily engaged in the construction of structural
concrete highway bridges and overpasses, and the paving of highways and airport
runways in the states of Nevada, Arizona, Utah and New Mexico. MVC was acquired
by the Company as of October 1, 1994. ( See Note 2) RMI is a producer and
retailer of ready-mix concrete operating in the Las Vegas metropolitan area.
PPI manufactures and erects prestressed products, primarily in the Southern
Nevada area.
Principles of Consolidation:
The accompanying consolidated financial statements include the accounts of the
Company and its wholly-owned subsidiaries MVC, RMI and PPI. Intercompany
transactions and balances have been eliminated in consolidation.
Accounting Estimates:
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
Revenue and Cost Recognition:
Revenues and costs from fixed-price and modified fixed-price construction
contracts are recognized for each contract on the percentage-of-completion
method, measured by the percentage of costs incurred to date to the estimated
total of direct costs. Direct costs include, among other things, direct labor,
field labor, equipment rent, subcontracting, direct materials, and direct
overhead. General and administrative expenses are accounted for as period costs
and are, therefore, not included in the calculation of the estimates to complete
construction contracts in progress. Project losses are provided in the period
in which such losses are determined, without reference to the percentage-of-
completion. As contracts can extend over one or more accounting periods,
revisions in costs and earnings estimated during the course of the work are
reflected during the accounting period in which the facts that required such
revisions become known.
The asset "costs and estimated earnings in excess of billings on uncompleted
contracts" represents revenue recognized in excess of amounts billed. The
liability "billings in excess of costs and estimated earnings on uncompleted
contracts" represents billings in excess of revenues recognized.
Restricted Cash:
At December 31, 1996 and December 31, 1997 funds in the amount of $1,415,577
and $1,719,768 were held in trust, in lieu of retention, on some of the
Company's construction contracts and will be released to the Company after the
contracts are completed.
Accounts Receivable:
Included in accounts receivable are trade receivables that represent amounts
billed but uncollected on completed construction contracts and construction
contracts in progress.
The Company follows the allowance method of recognizing uncollectible accounts
receivable. The allowance method recognizes bad debt expense based on a review
of the individual accounts outstanding, and the Company's prior history of
uncollectible accounts receivable. As of December 31, 1996, no allowance was
established for potentially uncollectible accounts receivable because, in the
opinion of management, all accounts were considered fully collectible. As of
December 31, 1997, $35,441 has been established for potentially uncollectible
accounts receivable.
F-8
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
Property and Equipment:
Property and equipment are recorded at cost. Depreciation is provided for on
the straight-line method, over the following estimated useful lives.
Plant 15 years
Computer equipment 5-7 years
Equipment 3-10 years
Vehicles 5 years
Office furniture and equipment 5-7 years
Leasehold Improvements 5 years
Goodwill:
Goodwill represents the excess of the costs of acquiring Meadow Valley
Contractors, Inc. over the fair value of its net assets and is being amortized
on the straight-line method over twenty-five (25) years. Amortization expense
charged to operations for the years ended December 31, 1995, 1996 and 1997
amounted to $81,390, $80,029 and $80,029. The carrying value of goodwill will
be periodically reviewed by the Company and impairments, if any, will be
recognized when expected future operating cash flows derived from goodwill is
less than its carrying value.
Tradename:
On January 2, 1996, the Company acquired the tradename of AKR Contracting in
the amount of $36,531. The tradename amortization is provided for on a straight
line basis over three years. Amortization expense charged to operations in
each of the years ended December 31, 1996 and 1997 was $12,177.
Income Taxes:
The Company accounts for income taxes in accordance with the Financial
Accounting Standards No. 109, "Accounting for Income Taxes" (SFAS 109). SFAS
109 requires the Company to recognize deferred tax assets and liabilities for
the expected future tax consequences of events that have been recognized in a
Company's financial statements or tax returns. Under this method, deferred tax
assets and liabilities are determined based on the difference between the
financial statement carrying amounts and tax basis of assets and liabilities
using enacted tax rates in effect in the years in which the differences are
expected to reverse. The Company files consolidated tax returns with MVC, RMI
and PPI for federal and state tax reporting purposes.
Cash Flow Recognition:
For purposes of the statement of cash flows, the Company considers all highly
liquid instruments purchased with an initial maturity of three (3) months or
less to be cash equivalents.
Fair Value of Financial Instruments:
The Financial Accounting Standards Board issued SFAS No. 107, Disclosures
about Fair Value of Financial Statements, which was effective December 31, 1995.
This statement requires the disclosure of estimated fair values for all
financial instruments for which it is practicable to estimate fair value.
The carrying amounts of financial instruments including cash, restricted cash,
accounts receivable, costs and estimated earnings in excess of billings on
uncompleted contracts, prepaid expenses and other, current portion of notes
receivable, current maturities of long-term debt, accounts payable, billings in
excess of costs and estimated earnings on uncomplete contracts and accrued
liabilities approximate fair value because of their short maturity.
F-9
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
Fair Value of Financial Instruments (Continued):
The carrying amount of long-term debt approximates fair value because the
interest rates on these instruments approximate the rates at which the Company
could borrow at December 31, 1996 and 1997.
Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
Be Disposed of:
Statement of Financial Accounting Standards No.121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of"
(SFAS 121) establishes new guidelines regarding when impairment losses on
Long-Lived assets, which include plant and equipment, and certain identifiable
intangible assets, should be recognized and how impairment losses should be
measured. The Company has adopted this accounting standard and its effects on
the financial position and results of operations were immaterial.
Stock-Based Compensation:
Statements of Financial Accounting Standards No. 123, "Accounting for Stock-
Based Compensation" (SFAS No. 123) establishes a fair value method of accounting
for stock-based compensation plans and for transactions in which an entity
acquires goods or services from nonemployees in exchange for equity instruments.
The Company adopted this accounting standard on January 1, 1996. SFAS 123 also
encourages, but does not require companies to record compensation cost for
stock-based employee compensation. The Company has chosen to continue to
account for stock-based compensation utilizing the intrinsic value method
prescribed in Accounting Principles Board Opinion No. 25, "Accounting for Stock
Issued to Employees." Accordingly, compensation cost for stock options is
measured as the excess, if any, of the fair market price of the Company's stock
at the date of grant over the amount an employee must pay to acquire the stock.
Earnings per Share:
Statement of Financial Accounting Standards No. 128, "Earnings per Share,"
("SFAS 128") issued by the FASB is effective for financial statements with
fiscal years and interim periods beginning after December 15, 1997. Early
adoption is not permitted. SFAS 128 provides for the calculation of Basic and
Diluted earnings per share. Basic earnings per share includes no dilution and
is computed by dividing income available to common shareholders by the weighted
average number of common shares outstanding for the period. Diluted earnings
per share reflects the potential dilution of securities that could share in the
earnings of an entity, similar to fully diluted earnings per share. The Company
adopted this accounting standard on December 15, 1997. The effect of adopting
this standard was that diluted earnings per share decreased by $.01 over the
calculations under APB opinion No.15. There was no effect on prior years.
Disclosure of Information about Capital Structure:
Statement of Financial Accounting Standard No. 129, "Disclosure of Information
about Capital Structure," ("SFAS 129") issued by the FASB is effective for
financial statements ended December 15, 1997. The new standard reinstates
various securities disclosure requirements previously in effect under Accounting
Principles Board Opinion No. 15, which has been superseded by SFAS No. 128. The
Company does not expect adoption of SFAS No. 129 to have a material effect, if
any, on its financial position or results of operations.
Reporting Comprehensive Income:
Statement of Financial Accounting Standard No. 130, "Reporting Comprehensive
Income," ("SFAS 130") issued by the FASB is effective for financial statements
with fiscal years beginning after December 15, 1997. Earlier application is
permitted. SFAS 130 establishes standards for reporting and display of
comprehensive income and its components in a full set of general-purpose
financial statements. The Company does not expect adoption of SFAS 130 to have
a material effect, if any, on its financial position or results of operations.
Disclosures about Segments of an Enterprise and Related Information:
Statement of Financial Accounting Standards No. 131, "Disclosures about
Segments of an Enterprise and Related Information," ("SFAS 131") issued by the
FASB is effective for financial statements with fiscal years beginning after
December 15, 1997. Earlier application is permitted. SFAS 131 requires that
public companies report certain information about operating segments, products,
services and geographical areas in which they operate and their major customers.
The Company does not expect adoption of SFAS 131 to have a material effect, if
any, on its financial position or results of operations.
F-10
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
2. ACQUISITION:
On October 24, 1994, the Company signed a Stock Purchase Agreement to purchase
all of the outstanding common stock of MVC. The acquisition was effective as of
October 1, 1994. The purchase price included a $10,000,000 promissory note,
bearing interest at ten percent (10%) per annum, and due ten days after the
closing of the Initial Public Offering. Also included in the aforementioned
Stock Purchase Agreement was a $1,500,000 stock note payable, bearing interest
at six percent (6%) per annum, and due ten days after the closing of the Initial
Public Offering. Payment of the stock note payable was made by the issuance of
500,000 shares of restricted common stock. Prior to the initial public offering
the promissory notes were secured by all of the outstanding common stock of MVC.
(See Note 12)
The acquisition of MVC was accounted for using the purchase method of
accounting under APB Opinion 16 "Business Combinations". Accordingly, the assets
and liabilities were valued at their fair values for the portion of the
acquisition relating to new stockholders of the Company's interest which
resulted in increasing the basis of the historical book value of the net assets
acquired (all goodwill) in the amount of $1,864,676. In addition, as of October
1, 1994, $799,147 was charged to stockholders' equity, representing the
proportionate amount of the net purchase price in excess of the cost of the
interest of certain stockholders of the Company who were also stockholders of
MVC prior to the acquisition. During the year ended December 31, 1995 the
Company incurred additional costs relating to the acquisition in the amount of
$136,058.
3. CONCENTRATION OF CREDIT RISK:
The Company maintains cash balances at various financial institutions.
Deposits not to exceed $100,000 for each institution are insured by the Federal
Deposit Insurance Corporation. At December 31, 1996 and December 31, 1997, the
Company has uninsured cash, cash equivalents, and restricted cash in the amount
of $5,434,509 and $8,465,267.
4. ACCOUNTS RECEIVABLE:
Following is a summary of receivables at December 31, 1996 and December 31,
1997.
<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31,
1996 1997
----------------------------
<S> <C> <C>
Contracts in progress.................. $17,079,502 $18,169,773
Contracts in progress - retention...... 7,590,488 5,605,988
Completed contracts.................... 927,230 29,361
Completed contracts - retention........ 436,832 138,163
Other receivables...................... 827,406 2,336,629
----------------------------
26,861,458 26,279,914
Less: Allowance for doubtful accounts.. - (35,441)
----------------------------
$26,861,458 $26,244,473
============================
</TABLE>
F-11
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
5. CONTRACTS IN PROGRESS:
Costs and estimated earnings in excess of billings and billings in excess of
costs and estimated earnings on uncompleted contracts consist of the following:
<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31,
1996 1997
-------------------------------
<S> <C> <C>
Costs incurred on uncompleted contracts.. $ 164,191,228 $ 248,840,680
Estimated earnings to date............... 7,179,053 12,345,608
-------------------------------
171,370,281 261,186,288
Less: billings to date................... (171,016,806) (263,088,311)
-------------------------------
$ 353,475 $ (1,902,023)
===============================
Included in the accompanying balance sheet under the following captions:
Costs and estimated earnings in excess
of billings on uncompleted contracts.... $ 3,726,328 $ 4,758,917
Billings in excess of costs and
estimated earnings on uncompleted
contracts............................... (3,372,853) (6,660,940)
-------------------------------
$ 353,475 $ (1,902,023)
===============================
6. PROPERTY AND EQUIPMENT:
Property and equipment consists of the following:
DECEMBER 31, DECEMBER 31,
1996 1997
-------------------------------
<S> <C> <C>
Land..................................... $ 562,901 $ 788,379
Plant.................................... - 2,106,476
Computer equipment....................... 173,905 292,538
Equipment................................ 3,542,594 6,518,913
Vehicles (Note 14)....................... 1,824,078 2,433,510
Office furniture and equipment........... 42,897 45,816
Leasehold improvements................... 42,028 60,689
-------------------------------
6,188,403 12,246,321
Accumulated depreciation................. (972,413) (2,034,853)
-------------------------------
5,215,990 10,211,468
Construction in progress................. 62,400 -
-------------------------------
$ 5,278,390 $ 10,211,468
===============================
</TABLE>
F-12
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
7. ACCOUNTS PAYABLE:
Accounts payable consist of the following:
<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31,
1996 1997
----------------------------
<S> <C> <C>
Trade...................................................... $13,456,213 $14,245,993
Retentions................................................. 6,173,594 5,290,428
----------------------------
$19,629,807 $19,536,421
============================
8. ACCRUED LIABILITIES:
Accrued liabilities consist of the following:
DECEMBER 31, DECEMBER 31,
1996 1997
----------------------------
Salaries and wages......................................... $ 772,265 $1,002,738
Interest................................................... 113,717 79,143
Taxes...................................................... 225,149 315,156
Insurance.................................................. 276,525 358,948
Legal fees................................................. 180,000 -
Other...................................................... 209,678 237,197
----------------------------
$1,777,334 $1,993,182
============================
9. NOTES PAYABLE - OTHER:
Notes payable - other consist of the following
DECEMBER 31, DECEMBER 31,
1996 1997
-----------------------------
<S> <C> <C>
Notes payable, interest rates ranging from 6.382% to 10% with monthly
payments of $79,110, due dates ranging from 12/18/99 to 1/1/03,
collateralized by equipment........................................... $ 833,687 $3,144,590
Notes payable, interest rates ranging from 9.0% to 9.33% with monthly
payments of $9,958, due dates ranging from 8/15/03 to 12/31/04,
collateralized by land................................................ 420,000 548,068
-----------------------------
1,253,687 3,692,658
Less: current portion.................................................. (266,220) (818,846)
$ 987,467 $2,873,812
=============================
</TABLE>
Following are maturities of long-term debt for each of the next 5 years:
1998................ $ 818,846
1999................ 880,027
2000................ 769,229
2001................ 650,770
2002................ 454,401
Subsequent to 2002.. 119,385
$3,692,658
=============
F-13
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
10. LINES OF CREDIT:
At December 31, 1997, the Company had available from a commercial bank a
$2,000,000 operating line of credit at an interest rate of the commercial bank's
prime plus .50%, and a $2,000,000 operating line of credit at an interest rate
of the commercial bank's prime plus .25% ("lines of credit"). At December 31,
1997, nothing had been drawn on either of the lines of credit. Under the lines
of credit, the Company is required to maintain certain levels of working
capital, to promptly pay all its obligations and is precluded from conveying,
selling or leasing all or substantially all of its assets. At December 31, 1997,
the Company was in compliance with all such covenants. The lines of credit
expires September 15, 1998.
11. NOTE RECEIVABLE - OTHER:
Note receivable - other consist of the following:
<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31,
1996 1997
-----------------------------
<S> <C> <C>
8% note receivable, 84 monthly payments in the amount of $1,565
commencing July 19, 1996, balloon payment in the amount of $197,282
due June 19, 2003, collateralized by deed of trust................... $212,457 $211,273
Less: current portion................................................ (1,855) (2,009)
-----------------------------
$210,602 $209,264
=============================
</TABLE>
12. RELATED PARTY TRANSACTIONS:
Note receivable - related party:
Note receivable - related party consists of a 6% note receivable from a
corporate officer, dated December 15, 1994, due June 15, 1997, collateralized by
100,000 share of the Company's common stock. During June 1997, the Company
extended the due date to June 15, 1998. Note receivable - related party was
$257,575 at December 31, 1996 and 1997. (See Note 21)
Equipment:
During the year ended December 31, 1996 the Company purchased equipment
used in the construction business from a related party in the amount of
$299,800.
Professional Services:
During the year ended December 31, 1996 and 1997, a related party rendered
professional services to the Company in the amounts of $26,654 and $17,528.
Subcontractor/Supplier:
Various related parties performed construction work for the Company as a
subcontractor or provided materials and equipment used in the construction
business during the years ended December 31, 1995, 1996 and 1997, in the amounts
of $119,614, $81,581 and $19,352. Included in accounts payable at December 31,
1996 and 1997 are amounts due to related parties, in the amount of $5,808 and
$5,495.
Accrued Interest:
During the years ended December 31, 1995, 1996 and 1997, the Company
incurred interest expense in the amounts of $1,063,716, $438,699 and $412,842
related to notes payable to a principal stockholder. Included in accrued
liabilities at December 31, 1996 and December 31, 1997 are amounts due to
related parties, in the amount of $86,301 and $61,644. Included in accounts
receivable at December 31, 1996 and 1997 are amounted due from a related party,
in the amount of $15,455 and $15,455.
F-14
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
12. RELATED PARTY TRANSACTIONS (CONTINUED):
Note payable - related party:
<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31,
1996 1997
-----------------------------
<S> <C> <C>
12.5% note payable from a related party, due October 16, 2000, due in
equal installments of $1,000,000 plus accrued interest................. $3,500,000 $2,500,000
Less: current portion.................................................. (500,000) (500,000)
-----------------------------
$3,000,000 $2,000,000
=============================
</TABLE>
Commitments:
The Company leases office space in Moapa, Nevada on a month-to-month basis
from a Company controlled by a principal stockholder with monthly payments of
$800. The lease terms also require the Company to pay common area maintenance,
taxes, insurance and other costs. Rent expense under the lease for the year
ended December 31, 1995, 1996 and 1997 amounted to $14,400, $9,600 and $9,600,
respectively.
The Company leases additional space for its prestressed concrete operations
on a month-to-month basis from a Company controlled by a principal stockholder
with monthly payments of $2,500. Rent expense under the lease for the years
ended December 31, 1996 and 1997 amounted to $15,000 and $30,000.
13. INCOME TAXES:
The provisions for income taxes (benefit) consist of the following:
<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
1995 1996 1997
------------------------------------
<S> <C> <C> <C>
Current:
Federal................... $541,272 $ - 280,327
State..................... 68,043 - 39,093
------------------------------------
609,315 - 319,420
Deferred....................... (59,665) (21,635) 399,951
------------------------------------
$549,650 $(21,635) $719,371
====================================
</TABLE>
The Company's deferred tax liability consists of the following, all
of which is long-term in nature:
<TABLE>
<CAPTION>
DECEMBER 31,
1996 1997
--------------------------
<S> <C> <C>
Deferred tax asset:
Net operating loss carryforward.. $ 153,167 -
Other............................ - 13,822
Deferred tax liability:
Depreciation..................... (165,777) (426,383)
--------------------------
Net deferred tax liability............ $(12,610) $(412,561)
==========================
</TABLE>
For the years ended December 31, 1995, 1996 and 1997, the effective
tax rate differs from the federal statutory rate primarily due to state income
taxes.
F-15
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
14. COMMITMENTS:
The Company is currently leasing office space in Phoenix, Arizona under a
separate non-cancelable operating lease agreement expiring in December 2000.
During August 1997, the Company amended the original lease. The amended lease
agreement provides for monthly payments of $5,219 through December 31, 1999 and
$5,547 from January 1, 2000 through December 31, 2000. The lease also requires
the Company to pay common area maintenance, taxes, insurance and other costs.
Rent under the aforementioned operating lease was $14,622, $44,481 and $56,576
for the years ended December 31, 1995, 1996 and 1997. The Company also is
currently leasing office space in Layton, Utah under a separate non-cancelable
operating lease agreement providing for monthly payments of $1,050 expiring
February 1998. Rent under the aforementioned operating lease was $12,600 for
the year ended December 31, 1997.
The Company has entered into employment contracts with each of its
executive officers that provide for an annual salary, issuance of the Company's
common stock and various other benefits and incentives. At December 31, 1996
and 1997, the total commitments, excluding benefits and incentives amount to
$735,416 and $1,582,500.
The Company is the lessee of vehicles and equipment under capital leases
expiring in various years through 2002. The assets and liabilities under a
capital lease are initially recorded at the lower of the present value of the
minimum lease payments or the fair value of the asset. Each asset is
depreciated over its expected useful life. Depreciation on the assets under
capital leases charged to expense in 1996 and 1997 was $114,175 and $298,283.
At December 31, 1996 and 1997, property and equipment included $897,749 and
$1,401,948, net of accumulated depreciation, of vehicles and equipment under
capital leases.
14. COMMITMENTS:
Minimum future lease payments under capital leases as of December 31, 1997
for each of the next five years and in aggregate are:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, AMOUNT
---------------------------------------------------------
<S> <C>
1998........................................ $ 523,108
1999........................................ 478,752
2000........................................ 390,667
2001........................................ 202,963
2002........................................ 44,560
-------------
Total minimum payments...................... 1,640,050
Less: executory costs....................... (42,229)
-------------
Net minimum lease payments.................. 1,597,821
Less: amount representing interest.......... (218,770)
-------------
Present value of net minimum lease payment.. $1,379,051
=============
</TABLE>
15. STOCKHOLDERS' EQUITY:
Preferred Stock:
The Company has authorized 1,000,000 shares of $.001 par value preferred
stock to be issued, with such rights, preferences, privileges, and restrictions
as determined by the Board of Directors.
F-16
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
15. STOCKHOLDERS' EQUITY (CONTINUED):
Initial Public Offering:
During October 1995, the Company completed an initial public offering
("Offering") of Units of the Company's securities. Each unit consisted of one
share of $.001 par value common stock and one redeemable common stock purchase
warrant ("Warrant"). Each Warrant is exercisable to purchase one share of
common stock at $7.20 per share for a period of 5 years from the date of the
Offering. The Offering included the sale of 1,926,250 Units at $6.00 per Unit.
Net proceeds of the Offering, after deducting underwriting commissions and
offering expenses of $2,122,080, amounted to $9,435,420. In connection with the
Offering, the Company granted the underwriters warrants to purchase 167,500
shares of common stock at $7.20 per share for a period of 4 years from the date
of the Offering.
16. LITIGATION MATTERS:
The Company is defending a claimed preference in connection with a payment
made to it by an insurance Company in the approximate amount of $100,000. The
Company believes that the payment is not a preference, and is vigorously
defending the action.
17. STATEMENT OF CASH FLOWS:
Non-Cash Investing and Financing Activities:
The Company recognized investing and financing activities that
affected assets, liabilities, and equity, but did not result in cash receipts or
payments. These non-cash activities are as follows:
During the year ended December 31, 1995, the Company issued 500,000 share
of restricted common stock in satisfaction of a $1,500,000 discounted stock note
payable. The Company acquired the stock of MVC for a $10 million note payable
and a 500,000 share stock note payable valued at $1,500,000 effective October 1,
1994. (See Note 2)
During the year ended December 31, 1995, the Company exchanged certain
machinery and equipment with a book value of $20,000, plus cash of $74,160, for
similar equipment with a cost of $94,160, which represents the book value of
equipment given up plus the cash price.
During the years ended December 31, 1995 and 1996, the Company financed
the purchase of construction vehicles and equipment in the amount of $290,533
and $1,719,685.
During the year ended December 31, 1996, the Company financed the purchase
of land in the amount of $420,000.
During the year ended December 31, 1996, the Company financed the sale of
real estate in the amount of $213,333.
During the year ended December 31, 1997, the Company financed the purchase
of property, plant and equipment in the amount of $3,658,608.
F-17
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
18. SIGNIFICANT CUSTOMERS:
For the years ended December 31, 1995, 1996 and 1997, the Company
recognized a significant portion of its revenue from three Customers (shown as
an approximate percentage of total revenue):
<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
1995 1996 1997
--------------------------------
<S> <C> <C> <C>
A............ 33.2% 23.7% 27.2%
B............ 39.1% 41.3% 32.2%
C............ - - 14.4%
</TABLE>
At December 31, 1996 and December 31 ,1997, amounts due from the
aforementioned Customers included in restricted cash and accounts receivables,
are as follows:
<TABLE>
<CAPTION>
DECEMBER 31,
1996 1997
--------------------------
<S> <C> <C>
A............ $ 3,835,166 $ 4,276,679
B............ 14,280,369 13,735,567
C............ - 2,936,029
</TABLE>
19. STOCK OPTION PLAN:
In November, 1994, the Company adopted a Stock Option Plan providing for
the granting of both qualified incentive stock options and non-qualified stock
options. The Company reserved 700,000 shares of its common stock for issuance
under the Plan. Granting of the options is at the discretion of the Board of
Directors and may be awarded to employees and consultants. Consultants may
receive only non-qualified stock options. The maximum term of the stock options
are 10 years and may be exercised as follows: 33.3% after one year of continuous
service, 66.6% after two years of continuous service and 100.0% after three
years of continuous service. The exercise price of each option is equal to the
market price of the Company's common stock on the date of grant.
The following summarizes the stock option transactions:
<TABLE>
<CAPTION>
WEIGHTED
SHARES AVERAGE
PRICE PER SHARE
----------------------------
<S> <C> <C>
Outstanding December 31, 1995.. 239,700 $6.25
Granted................... 241,025 5.36
Forfeited................. (1,800) 5.36
---------
Outstanding December 31, 1996.. 478,925 5.87
Granted................... 80,000 5.87
Forfeited................. (34,900) 5.87
---------
Outstanding December 31, 1997.. 524,025 5.28
=========
</TABLE>
F-18
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
19. STOCK OPTION PLAN (CONTINUED):
Information relating to stock options at December 31, 1997 summarized by
exercise price are as follows:
<TABLE>
<CAPTION>
OUTSTANDING EXERCISABLE
------------------------------------------- -------------------------
WEIGHTED AVERAGE WEIGHTED AVERAGE
-------------------------- ----------------
EXERCISE
EXERCISE PRICE PER SHARE SHARES LIFE (YEAR) PRICE SHARES EXERCISE PRICE
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
$6.25 217,200 10 $6.25 144,800 $6.25
$4.375 to $5.41 226,825 10 $5.36 75,608 $5.36
$5.31 80,000 10 $5.31 - -
- ---------------------------------------------------------------------------------------------------
$4.375 to $6.25 524,025 10 $5.28 220,408 $5.26
===================================================================================================
</TABLE>
All stock options issued to employees have an exercise price not less than
the fair market value of the Company's Common Stock on the date of grant. In
accordance with accounting for such options utilizing the intrinsic value
method, there is no related compensation expense recorded in the Company's
financial statements for the year ended December 31, 1995, 1996 and 1997. Had
compensation cost for stock-based compensation been determined based on the fair
value of the options at the grant dates consistent with the method of SFAS 123,
the Company's net income and earnings per share for the years ended December 31,
1995, 1996 and 1997 would have been reduced to the proforma amounts presented
below:
<TABLE>
<CAPTION>
1995 1996 1997
---------------------------------------
<S> <C> <C> <C>
Net income (loss)
As reported............. $1,059,347 $ (85,228) $1,211,615
Proforma................ $1.059,347 $(179,877) $ 989,003
Net income (loss) per share
As reported............. $ .65 $ (.02) $ .34
Proforma................ $ .65 $ (.05) $ .26
</TABLE>
The fair value of option grants is estimated as of the date of grant
utilizing the Black-Scholes option-pricing model with the following weighted
average assumptions for grants in 1995, 1996 and 1997: expected life of options
of 5 years, expected volatility of 23.94%, risk-free interest rates of 8.0%, and
a 0% dividend yield. The weighted average fair value at date of grant for
options granted during 1995, 1996 and 1997 approximated $1.31, $1.23 and $1.01.
20. BASIC EARNINGS (LOSS) PER SHARE:
The Company's basic net income (loss) per share at December 31, 1996 and
1997 was computed by dividing net income for the period by 3,601,250, the basic
weighted average number of common shares outstanding during the period.
Options to purchase 444,025 at a range of $4,375 to $6.25 per share were
outstanding during 1996, but were not included in the computation of diluted net
loss per common share because the options' exercise price was greater than the
average market price of the common share.
The Company's diluted net income per common share at December 31, 1997
includes 50,110 common shares that would be issued exercise of outstanding stock
options. Options to purchase 217,200 at $6.25 per share were outstanding during
1997, but were not included in the computation of diluted net income per common
share because the options' exercise price was greater than the average market
price of the common share.
21. OTHER INFORMATIVE DISCLOSURES:
During the years ended December 31, 1996 and 1997, the Company incurred
substantial costs related to its prestressed products subsidiary, which was
formed November 12, 1996. The following is a summary of that subsidiary's 1996
and 1997 results of operations:
<TABLE>
<CAPTION>
1996 1997
------------------------
<S> <C> <C>
Gross loss............ $ - $ (427,028)
Loss from operations.. (76,453) (1,304,472)
</TABLE>
F-19
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
22. SUBSEQUENT EVENTS:
During January 1998, the Company purchased equipment used in the
construction business from a related party in the amount of $295,000.
During January 1998, the note receivable-related party and related interest
receivable was repaid to the Company in the amount of $273,368. (See Note 12)
F-20
<PAGE>
EXHIBIT 10.51
INSTALLMENT SALE CONTRACT (SECURITY AGREEMENT)
PURCHASER(S): SELLER (DEALER):
MEADOW VALLEY CONTRACTORS, INC. CASHMAN EQUIPMENT COMPANY
P.O.BOX 60726
3101 EAST CRAIG ROAD
P.O. BOX 4217
PHOENIX, AZ 95082 LAS VEGAS NV 89127-0217
County: MARICOPA
- --------------------------------------------------------------------------------
Subject to the terms and conditions set forth below and on the reverse side
hereof, Seller hereby sells the equipment described below (the "Unit" or
"Units") to Purchaser, and Purchaser (if more than one, jointly and severally),
having been offered both a cash sale price and a time sale price, hereby buys
the Units from Seller on a time sale basis.
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------
NEW (IF USED) DELIVERED
OR FIRST MODEL DESCRIPTION OF UNIT(S) SERIAL# CASH SALE
USED USED PRICE
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
(1) USED 1996 IT28F Caterpillar Integrated Tool Carrier equipped 3Cl01822 99,850.00
</TABLE>
<TABLE>
<S> <C> <C> <C>
FIRST DESCRIPTION OF ADDITIONAL SECURITY
USED (MAKE MODEL & SERIAL NUMBER) Sub-Total............................... $ 99,850.00
- ---------------------------------------------------------- Sales Tax............................... $ 0.00
NONE 1. Total Cash Sale Price................... $ 99,850.00
Cash Down Pay 0.00
Net Trade-in Allow 0.00
2. Total Down Payment...................... $ 0.00
- ---------------------------------------------------------- 3. Unpaid Balance of Cash Price (1 - 2).... $ 99,850.00
FIRST DESCRIPTION OF TRADE-IN EQUIPMENT 4. Official Fees (Specify)................. $ 250.00
USED (MAKE MODEL & SERIAL NUMBER) Documentation Fee 250.00
- ---------------------------------------------------------- 5. Physical Damage Insurance............... $
NONE 6. Principal Balance
(Amount Financed) (3 + 4 + 5)........... $ 100,100.00
__________________________________________________________ 7. Financed Charge
(Time Price Differential)............... $ 14,067.52
Trade-in Value 0.00 8. Time Balance
Less Owing to (___n/a___) 0.00 (Total of Payment) (6 + 7).............. $ 114,167.52
Net Trade-in Allowance 0.00 9. Time Sale Balance
(Total of Payment Price) (2 + 8)........ $ 114,167.52
Location of Units: Salt Lake City Airport 10. Annual Percentage Rate.................. 6.60%
Salt Lake City , UT 84101 11. Date FINANCE CHARGE begins to accrue.... 9/20/97
</TABLE>
Purchaser herby sells and conveys to Seller the above described Trade-in
Equipment and warrants it to be free and clear of all claims, liens, security
interests and encumbrances except to the extent shown above.
1. PAYMENT: Purchaser promises to pay to Seller at the address designated
in writing by Seller the Time Balance (item 8 above) as follows [check (a) or
(b)]:
X (a) in 48 equal monthly Installments of $2,376.49 each, with the first
- ---
installment due on 10/20/97, and the balance of the Installments due on the like
day of each month thereafter, (except no payments shall be due during the
month(s) of (___n/a___)), until the entire indebtedness has been paid; or
__ (b) in accordance with the Payment Schedule attached to this Contract.
(Provisions of section 1 continued on reverse.)
SEE REVERSE SIDE FOR ADDITIONAL TERMS AND CONDITIONS WHICH ARE A PART
OF THIS CONTRACT.
LIABILITY INSURANCE COVERAGE FOR BODILY INJURY AND PROPERTY DAMAGE CAUSED TO
OTHERS IS NOT INCLUDED IN THIS CONTRACT.
NOTICE TO PURCHASER: (1) DO NOT SIGN THIS CONTRACT BEFORE YOU READ IT OR IF IT
CONTAINS ANY BLANK SPACES; (2) YOU ARE ENTITLED TO AN EXACT COPY OF THE CONTRACT
YOU SIGN; (3) UNDER THE LAW YOU MAY HAVE THE RIGHT TO PAY OFF IN ADVANCE THE
FULL AMOUNT DUE AND TO OBTAIN A PARTIAL REFUND OF THE FINANCE CHARGE.
PURCHASER ACKNOWLEDGES RECEIPT OF A FULLY COMPLETED COPY OF THIS CONTRACT
EXECUTED BY BOTH PURCHASER AND SELLER.
Purchaser(s) and Seller have duly executed this Contract as of 9/20, 1997.
Purchaser(s): Seller:
MEADOW VALLEY CONTRACTORS, INC. CASHMAN EQUIPMENT COMPANY
By /s/ Gary W. Burnell By /s/ Andrea B. Price
------------------------------ -----------------------------------
Name (PRINT) GARY W. BURNELL Name (PRINT) ANDREA B. PRICE
-------------------- -------------------------
Title VP/CEO Title ADMINISTRATIVE CONTROLLER
--------------------------- --------------------------------
<PAGE>
EXHIBIT 10.52
INSTALLMENT SALE CONTRACT (SECURITY AGREEMENT)
PURCHASER(S): SELLER (DEALER):
MEADOW VALLEY CONTRACTORS, CASHMAN EQUIPMENT COMPANY
INC.
P.O. BOX 60726 3101 EAST CRAIG ROAD
P.O. BOX 4217
PHOENIX, AZ 85082 LAS VEGAS NV 89127-0217
County: MARICOPA
- --------------------------------------------------------------------------------
Subject to the terms and conditions set forth below and on the reverse side
hereof, Seller hereby sells the equipment described below (the "Unit" or
"Units") to Purchaser, and Purchaser (if more than one, jointly and severally),
having been offered both a cash sale price and a time sale price, hereby buys
the Units from Seller on a time sale basis.
- --------------------------------------------------------------------------------
NEW (IF USED) DELIVERED
OR FIRST MODEL DESCRIPTION OF UNIT(S) SERIAL# CASH SALE
USED USED PRICE
- --------------------------------------------------------------------------------
(1) USED 1995 RT100 Caterpillar TELESCOPIC HANDLER 1GJ01186 71,343.00
<TABLE>
<S> <C>
- ------------------------------------------------------------------------------------------------------------------------
FIRST DESCRIPTION OF ADDITIONAL SECURITY
USED (MAKE, MODEL & SERIAL NUMBER) Sub Total.............................. $ 71,343.00
- ----------------------------------------------------------
NONE Sales Tax.............................. $ 0.00
1. Total Cash Sale Price.................. $ 71,343.00
Cash Down Pay
Net Trade-In Allow 0.00
2. Total Down Payment..................... $ 0.00
- ----------------------------------------------------------
FIRST DESCRIPTION OF TRADE-IN EQUIPMENT 3. Unpaid Balance of Cash Price (1-2)..... $ 71,343.00
USED (MAKE, MODEL & SERIAL NUMBER)
- ----------------------------------------------------------
NONE 4. Official Fees (Specify)................ $ 250.00
DOCUMENTATION FEE 250.00
5. Physical Damage Insurance.............. $
6. Principal Balance
(Amount Financed) (3 + 4 + 5).......... $ 71,593.00
- -----------------------------------------------------------
7. Finance Charge
Trade-in Value 0.00 (Time Price Differential).............. $ 10,347.32
Less Owing to (___n/a___) 0.00 8. Time Balance
Net Trade-in allowance 0.00 (Total of Payments) (5 + 7)............ $ 81,940.32
9. Time Sale Balance
Location of Units: 4411 s. 40th ST STE D11 (Total of Payment Price (2 + 8)........ $ 81,940.32
PHOENIX, AZ 85040 MARICOPA 10. Annual Percentage Rate 6.78%
11. Date FINANCE CHARGE begins to accrue 8/12/97
</TABLE>
PURCHASER HEREBY SELLS AND CONVEYS TO SELLER THE ABOVE DESCRIBED TRADE-IN
EQUIPMENT AND WARRANTS IT TO BE FEE AND CLEAR OF ALL CLAIMS, LIENS, SECURITY
INTERESTS AND ENCUMBRANCES EXCEPT TO THE EXTENT SHOWN ABOVE.
1. PAYMENT: Purchaser promises to pay to Seller at the address
designated in writing by Seller the Time Balance (Item 8 above) as follows
[check (a) or (b)]:
X (a) In 48 equal monthly installments of $1,707.09 each, with the first
- ---
installment due on 9/27/97, and the balance of the installments due on the like
day of each month thereafter, (except no payments shall be due during the
month(s) of (___n/a___)), until the entire indebtedness has been paid; or
___ (b) In accordance with the Payment Schedule attached to this Contract.
(Provisions of section 1 continued on reverse.)
SEE REVERSE SIDE FOR ADDITIONAL TERMS AND CONDITIONS WHICH ARE A PART OF THIS
CONTRACT.
LIABILITY INSURANCE COVERAGE FOR BODILY INJURY AND PROPERTY DAMAGE CAUSED TO
OTHERS IS NOT INCLUDED IN THIS CONTRACT.
NOTICE TO PURCHASER: (1) DO NOT SIGN THIS CONTRACT BEFORE YOU READ IT OR IF IT
CONTAINS ANY BLANK SPACES; (2) YOU ARE ENTITLED TO AN EXACT COPY OF THE CONTRACT
YOU SIGN; (3) UNDER THE LAW YOU MAY HAVE THE RIGHT TO PAY OFF IN ADVANCE THE
FULL AMOUNT DUE AND TO OBTAIN A PARTIAL REFUND OF THE FINANCE CHARGE.
PURCHASER ACKNOWLEDGES RECEIPT OF A FULLY COMPLETED COPY OF THIS CONTRACT
EXECUTED BY BOTH PURCHASER AND SELLER.
Purchaser(s) and Seller have duly executed this Contract as of 8/27, 1997.
Purchaser(s): Seller:
MEADOW VALLEY CONTRACTORS, CASHMAN EQUIPMENT COMPANY
INC.
By /s/ Gary W. Burnell By /s/ Candace N. Birt
-------------------------- ------------------------------
Name (PRINT) GARY W. BURNELL Name (PRINT) CANDACE N. BIRT
--------------- -------------------
Title VP/CFO Title Vice President & Treasurer
----------------------- --------------------------
<PAGE>
INSTALLMENT SALE CONTRACT (SECURITY AGREEMENT)
EXHIBIT 10.53
PURCHASER(S): SELLER:
MEADOW VALLEY CONTRACTORS,
INC. Cashman Equipment Company
P. O. BOX 60725 PO BOX 4217
Las Vegas, NV 89510
PHOENIX, AZ 85082
County:MARICOPA
- --------------------------------------------------------------------------------
Subject to the terms and conditions set forth below and on the reverse side
hereof, Seller hereby sells the equipment described below (the "Unit" or
"Units") to Purchaser, and Purchaser (if more than one, jointly and severally),
having been offered both a cash sale price and a time sale price, hereby buys
the Units from Seller on a time sale basis.
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
NEW (IF USED) DELIVERED
OR FIRST MODEL DESCRIPTION OF UNIT(S) SERIAL# CASH SALE
USED USED PRICE
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
(1) USED 1995 IT38F Caterpillar INTEGRATED TOOL CARRIER 6FN00388 146,887.00
(1) USED 1995 IT38F Caterpillar INTEGRATED TOOL CARRIER 6FN00306 128,000.00
(1) USED 1994 966F Caterpillar WHEEL LOADER 9YJ01417 185,000.00
- ----------------------------------------------------------------------------------------------------------------
FIRST DESCRIPTION OF ADDITIONAL SECURITY
USED [MAKE, MODEL & SERIAL NUMBER] Sub-Total............................ $ 459,887.00
- -------------------------------------------------
NONE Sales Tax............................ $ 32,192.09
1. Total Cash Sale Price................ $ 492,079.09
Cash Down Pay 42,690.15
Net Trade-in Allow 0.00
2. Total Down Payment................... $ 42,690.15
- -------------------------------------------------
FIRST DESCRIPTION OF TRADE-IN EQUIPMENT 3. Unpaid Balance of Cash Price (1 - 2). $ 449,388.94
USED [MAKE, MODEL & SERIAL NUMBER] 4. Official Fees (Specify).............. $ 250.00
- -------------------------------------------------
NONE Documentation Fee 250.00
5. Physical Damage Insurance............ $
6. Principal Balance
- -------------------------------------------------
(Amount Financial) (3 + 4 + 5)....... $ 449,638.94
7. Finance Charge
Trade-in Value 0.00 (Time Price Differential)............ $ 82,639.06
Less Owing to (----n/a----) 0.00 8. Time Balance
Net Trade-in Allowance 0.00 (Total of Payments) (6 + 7).......... $ 532,278.00
9. Time Sale Balance
Location of Units: Vicinity of (Deferred Payment Price) (2 + 8)..... $ 574,968.15
Las Vegas, NV Clark County 10. Annual Percentage Rate 6.86%
11. Date FINANCE CHANGE begins to accrue. APR 01 1997
--------------
</TABLE>
PURCHASER HEREBY SELLS AND CONVEYS TO SELLER THE ABOVE DESCRIBED TRADE-IN
EQUIPMENT AND WARRANTS IT TO BE FREE AND CLEAR OF ALL CLAIMS, ITEMS, SECURITY
INTERESTS AND ENCUMBRANCES EXCEPT TO THE EXTENT SHOWN ABOVE.
1. PAYMENT: Purchaser promises to pay to Seller at the address designated
in writing by Seller the Time Balance (item 8 above) as follows [check (a) or
(b)]:
X (a) in 60 equal monthly installments of $8,871.30 each, which the first
- ---
installment due on MAY 01 1997 and the balance of the installments due on the
like day of each month thereafter, (except no payments shall be due during the
month(s) of (____n/a____)), until the entire indebtedness has been paid; or
__ (b) in accordance with the Payment Schedule attached to this Contract.
(Provisions of section 1 continued on reverse.)
SEE REVERSE SIDE FOR ADDITIONAL TERMS AND CONDITIONS WHICH ARE A PART
OF THIS CONTRACT.
LIABILITY INSURANCE COVERAGE FOR BODILY INJURY AND PROPERTY DAMAGE CAUSED TO
OTHERS IS NOT INCLUDED IN THIS CONTRACT.
NOTICE TO PURCHASER: (1) DO NOT SIGN THIS CONTRACT BEFORE YOU READ IT OR IF IT
CONTAINS ANY BLANK SPACES; (2) YOU ARE ENTITLED TO AN EXACT COPY OF THE CONTRACT
YOU SIGN: (3) UNDER THE LAW YOU MAY HAVE THE RIGHT TO PAY OFF IN ADVANCE THE
FULL AMOUNT DUE AND TO OBTAIN A PARTIAL REFUND OF THE FINANCE CHARGE.
PURCHASER ACKNOWLEDGES RECEIPT OF A FULLY COMPLETED COPY OF THIS CONTRACT
EXECUTED BY PURCHASER, THIS CONTRACT IS NOT BINDING UPON SELLER UNTIL EXECUTED
BY AN AUTHORIZED REPRESENTATIVE OF SELLER.
Purchaser(s) and Seller have duly executed this Contract as of APR 01 1997,
19__.
Purchaser(s): Seller:
MEADOW VALLEY CONTRACTORS,
INC. Cashman Equipment Company
By /s/ KENNETH D. NELSON By see attached
------------------------------------ ---------------------------------
Name (PRINT) /s/ KENNETH D. NELSON Name (PRINT)_______________________
--------------------------
Title VICE PRESIDENT Title _____________________________
--------------------------------
<PAGE>
INSTALLMENT SALE CONTRACT (SECURITY AGREEMENT)
EXHIBIT 10.54
PURCHASER(S): SELLER (DEALER):
MEADOW VALLEY CONTRACTORS, WHEELER MACHINERY CO.
INC.
PO BOX 60726 4901 WEST 2100 SOUTH
PHOENIX, AZ 85082 SALT LAKE CITY UT 84120-1227
County:MARICOPA
- --------------------------------------------------------------------------------
Subject to the terms and conditions set forth below and on the reverse side
hereof, Seller hereby sells the equipment described below (the "Unit" or
"Units") to Purchaser, and Purchaser (if more than one, jointly and severally),
having been offered both a cash sale price and a time sale price, hereby buys
the Units from Seller on a time sale basis.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NEW (IF USED) DELIVERED
OR FIRST CASH SALE
USED USED MODEL DESCRIPTION OF UNIT(S) SERIAL# PRICE
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
(1) USED 1989 140G Caterpillar MOTOR GRADER 72V12452 118,694.60
(1) USED 1994 CS563 Caterpillar COMPACTOR 8XF01017 82,525.78
(1) USED 1994 LNT8000 Ford Water Truck 1FDYW8ZEGRVAD7118 62,267.49
ACCEPTED, ACKNOWLEDGED
AND CERTIFIED BY CATERPILLAR
FINANCIAL SERVICES CORPORATION
AS THE ORIGINAL
BY: /s/ J. R. English
TITLE: EXECUTIVE VICE PRESIDENT
- ----------------------------------------------------------------------------------------------------------------
FIRST DESCRIPTION OF ADDITIONAL SECURITY
USED [MAKE MODEL & SERIAL NUMBER] Sub-Total............................ $ 263,487.87
- -------------------------------------------------
NONE Sales Tax............................ $ 8,335.05
1. Total Cash Sale Price................ $ 271,822.92
Cash Down Pay 114,924.76
Net Trade-in Allow 0.00
2. Total Down Payment................... $ 114,924.79
- -------------------------------------------------
FIRST DESCRIPTION OF TRADE-IN EQUIPMENT 3. Unpaid Balance of Cash Price (1 - 2). $ 156,898.13
USED [MAKE MODEL & SERIAL NUMBER] 4. Official Fees (Specify).............. $ 150.00
- -------------------------------------------------
Documentation Fee 150.00
5. Physical Damage Insurance............ $
6. Principal Balance
- -------------------------------------------------
(Amount Financed) (3 + 4 + 5)........ $ 157,048.13
7. Finance Charge
Trade-in Value 0.00 (Time Price Differential)............ $ 18,944.35
Less Owing to (----n/a----) 0.00 8. Time Balance
Net Trade-in Allowance 0.00 (Total of Payments) (6 + 7).......... $ 175,992.45
9. Time Sale Balance
Location of Units: 640 M Main (Total of Payment Price) (2 + 8)..... $ 290,917.27
M Salt Lake, UT 84054 10. Annual Percentage Rate 7.56%
11. Date FINANCE CHARGE begins to accrue. 1/1/97
--------------
</TABLE>
PURCHASER HEREBY SELLS AND CONVEYS TO SELLER THE ABOVE DESCRIBED TRADE-IN
EQUIPMENT AND WARRANTS IT TO BE FREE AND CLEAR OF ALL CLAIMS, LIENS, SECURITY
INTERESTS AND ENCUMBRANCES EXCEPT TO THE EXTENT SHOWN ABOVE.
1. PAYMENT: Purchaser promises to pay to Seller at the address designated
in writing by Seller the Time Balance (item 8 above) as follows [check (a) or
(b)]:
X (a) in 36 equal monthly installments of $4,888.68 each, with the first
- ---
installment due on 2/1/97 and the balance of the installments due on the
like day of each month thereafter, (except no payments shall be due during the
month(s) of (____n/a____)), until the entire indebtedness has been paid; or
__ (b) in accordance with the Payment Schedule attached to this Contract.
(Provisions of section 1 continued on reverse.)
SEE REVERSE SIDE FOR ADDITIONAL TERMS AND CONDITIONS WHICH ARE A PART
OF THIS CONTRACT.
LIABILITY INSURANCE COVERAGE FOR BODILY INJURY AND PROPERTY DAMAGE CAUSED TO
OTHERS IS NOT INCLUDED IN THIS CONTRACT.
NOTICE TO PURCHASER: (1) DO NOT SIGN THIS CONTRACT BEFORE YOU READ IT OR IF IT
CONTAINS ANY BLANK SPACES; (2) YOU ARE ENTITLED TO AN EXACT COPY OF THE CONTRACT
YOU SIGN: (3) UNDER THE LAW YOU MAY HAVE THE RIGHT TO PAY OFF IN ADVANCE THE
FULL AMOUNT DUE AND TO OBTAIN A PARTIAL REFUND OF THE FINANCE CHARGE.
PURCHASER ACKNOWLEDGES RECEIPT OF A FULLY COMPLETED COPY OF THIS CONTRACT
EXECUTED BY BOTH PURCHASER AND SELLER.
Purchaser(s) and Seller have duly executed this Contract as of 1/1, 1997.
Purchaser(s): Seller:
MEADOW VALLEY CONTRACTORS, WHEELER MACHINERY CO.
INC. Cashman Equipment Company
By /s/ KENNETH D. NELSON By /s/ THOMAS H. CLARK
------------------------------------ ---------------------------------
Name (PRINT) KENNETH D. NELSON Name (PRINT) THOMAS H. CLARK
-------------------------- -----------------------
Title VICE PRESIDENT Title SECRETARY - TREASURER
-------------------------------- ------------------------------
<PAGE>
EXHIBIT 10.55
INSTALLMENT SALE CONTRACT (SECURITY AGREEMENT)
PURCHASER(S): SELLER (DEALER):
READY MIX, INC. CASHMAN EQUIPMENT COMPANY
3430 E. Flamingo Road #100 3101 EAST CRAIG ROAD
P.O.BOX 4217
LAS VEGAS, NV 89121 LAS VEGAS NV 89127-0217
County: CLARK
- --------------------------------------------------------------------------------
Subject to the terms and conditions set forth below and on the reverse side
hereof. Seller hereby sells the equipment described below (the "Unit" or
"Units") to Purchaser, and Purchaser (if more than one, jointly and severally),
having been offered both a cash sale price and a time sale price, hereby buys
the Units from Seller on a time sale basis.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
NEW (IF USED) DELIVERED
OR FIRST MODEL DESCRIPTION OF UNIT(S) SERIAL# CASH SALE
USED USED PRICE
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
(1) USED 1996 970E Caterpillar WHEEL LOADER 7SK00713 175,000.00
</TABLE>
- --------------------------------------------------------
FIRST DESCRIPTION OF ADDITIONAL SECURITY
USED (MAKE, MODEL & SERIAL NUMBER)
- --------------------------------------------------------
NONE
- --------------------------------------------------------
FIRST DESCRIPTION OF ADDITIONAL SECURITY
USED (MAKE, MODEL & SERIAL NUMBER)
- --------------------------------------------------------
NONE
________________________________________________________
Trade-in Value 0.00
Less Owing to n/a 0.00
Net Trade-in Allowance 0.00
Location of Units: 3430 E. FLAMINGO RD. #100
LAS VEGAS, NV 89121 CLARK
<TABLE>
<S> <C>
Sub-Total................................... $ 175,000.00
Sales Tax................................... $ 12,500.00
1. Total Cash Sale Price....................... $ 187,500.00
Cash Down Pay 18,725.00
Net Trade-In Allow 0.00
2. Total Down Payment.......................... $ 18,725.00
3. Unpaid Balance of Cash Price(1.2)........... $ 168,775.00
4. Official Fees (Specify)..................... $ 250.00
Documentation Fee 250.00
5. Physical Damage Insurance................... $
6. Principal Balance
(Amount Financed) ( 3 + 4 + 5).............. $ 169,025.00
7. Finance Charge
(Time price Differential)................... $ 26,386.84
8. Time Balance
(Total of Payments) (8 + 7)................. $ 195,411.84
9. Time Sale Balance
(Total of Payment Price) (2 + 8)............ $ 214,136.84
10. Annual Percentage Rate 7.30%
11. Date FINANCE CHARGE begins to accrue JUL 01 1997
-------------
</TABLE>
Purchaser hereby sells and conveys to Seller the above described Trade-in
Equipment and warrants it to be free and clear of all claims, liens, security
interests and encumbrances except to the extent shown above.
1. PAYMENT: Purchaser promises to pay to Seller at the address designated
in writing by Seller the Time Balance (item 8 above) as follows [check (a) or
(b)]:
X (a) in 48 equal monthly installments of $4,071.08 each, with the first
- ---
installment due on Aug 01 1997, and the balance of the installments due on the
like day of each month thereafter, (except no payments shall be due during the
month(s) of (___n/a___)), until the entire indebtedness has been paid; or
__ (b) in accordance with the Payment Schedule attached to this Contract.
(Provisions of section 1 continued on reverse.)
SEE REVERSE SIDE FOR ADDITIONAL TERMS AND CONDITIONS WHICH ARE A PART
OF THIS CONTRACT.
LIABILITY INSURANCE COVERAGE FOR BODILY INJURY AND PROPERTY DAMAGE CAUSED TO
OTHERS IS NOT INCLUDED IN THIS CONTRACT.
NOTICE TO PURCHASER: (1) DO NOT SIGN THIS CONTRACT BEFORE YOU READ IT OR IF IT
CONTAINS ANY BLANK SPACES; (2) YOU ARE ENTITLED TO AN EXACT COPY OF THE
CONTRACT YOU SIGN: (3) UNDER THE LAW YOU MAY HAVE THE RIGHT TO PAY OFF IN
ADVANCE THE FULL AMOUNT DUE AND TO OBTAIN A PARTIAL REFUND OF THE FINANCE
CHARGE.
PURCHASER ACKNOWLEDGES RECEIPT OF A FULLY COMPLETED COPY OF THIS CONTRACT
EXECUTED BY BOTH PURCHASER AND SELLER.
Purchaser(s) and Seller have duly executed this Contract as of Jul 01, 1997.
Purchaser(s): Seller:
READY MIX, INC. CASHMAN EQUIPMENT COMPANY.
By /s/ Paul Ronald Lewis By /s/ Candace N. Birt
------------------------------ -------------------------------
Name (PRINT) PAUL RONALD LEWIS Name (PRINT) CANDACE N. BIRT
-------------------- ---------------------
Title COO Title Vice President & Treasurer
--------------------------- ---------------------------
<PAGE>
EXHIBIT 10.56
- --------------------------------------------------------------------------------
A. U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
See HUD attachment(s) for '*' items
Final
- --------------------------------------------------------------------------------
B. TYPE OF LOANS:
- --------------------------------------------------------------------------------
1. FHA 2. FMHA 3. CONV. UNINS.
4. VA 5. CONV. INS.
- --------------------------------------------------------------------------------
6. FILE NUMBER 7. LOAN NUMBER
97050264
- --------------------------------------------------------------------------------
8. MTG INS CASE NO
- --------------------------------------------------------------------------------
C. NOTE This form is furnished to give you a statement of actual costs.
Amounts paid to and by the settlement agent are shown.
Items marked "(p.o.c.)" were paid outside the closing: they are shown here
for informational purposes and are not included in the totals.
- --------------------------------------------------------------------------------
D. NAME OF BORROWER: MEADOW VALLEY CONTRACTORS, INC.
ADDRESS: P.O. BOX 549, MOAPA, NV 89025
- --------------------------------------------------------------------------------
E. NAME OF SELLER: WARM SPRINGS R.V. PARK, INC.
ADDRESS: TIN:
- --------------------------------------------------------------------------------
F. NAME OF LENDER:
ADDRESS:
- --------------------------------------------------------------------------------
G. PROPERTY LOCATION:
APN: 690-210-013, MOAPA, NEVADA
- --------------------------------------------------------------------------------
H. SETTLEMENT AGENT: STEWART TITLE OF NEVADA
ADDRESS: 3800 HOWARD HUGHES PKWY,
#500 LAS VEGAS, NV 89109 TIN:88-0072969
- --------------------------------------------------------------------------------
I. PLACE OF SETTLEMENT: STEWART TITLE OF NEVADA Closing date: 11/24/97
ADDRESS: 2950 STH. RAINBOW
#220 LAS VEGAS, N Proration date: 11/24/97
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
J. SUMMARY OF BORROWER'S TRANSACTION K. SUMMARY OF SELLER'S TRANSACTION
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
400. GROSS AMOUNT DUE FROM BORROWER: 400. GROSS AMOUNT DUE TO SELLER:
- ------------------------------------------------------------------------------------------------------------------------------------
401. Contract sales price 225,000.00 401. Contract sales price 225,000.00
- ------------------------------------------------------------------------------------------------------------------------------------
402. Personal property 402. Personal property
- ------------------------------------------------------------------------------------------------------------------------------------
403. Settlement charges to borrower(line 1400) 220.38 403.
- ------------------------------------------------------------------------------------------------------------------------------------
404. 404.
- ------------------------------------------------------------------------------------------------------------------------------------
405. 405.
- ------------------------------------------------------------------------------------------------------------------------------------
Adjustments for Items paid by seller in advance; Adjustments for Items paid by seller in advance;
- ------------------------------------------------------------------------------------------------------------------------------------
406. City/town taxes to 406. City/town taxes to
- ------------------------------------------------------------------------------------------------------------------------------------
407. County taxes 11/24/97 to 07/01/98 257.89 407. County taxes 11/24/97 to 07/01/98 257.89
- ------------------------------------------------------------------------------------------------------------------------------------
408. Assessments to 408. Assessments to
- ------------------------------------------------------------------------------------------------------------------------------------
409. 409.
- ------------------------------------------------------------------------------------------------------------------------------------
410. 410.
- ------------------------------------------------------------------------------------------------------------------------------------
411. 411.
- ------------------------------------------------------------------------------------------------------------------------------------
412. 412.
- ------------------------------------------------------------------------------------------------------------------------------------
420. GROSS AMOUNT DUE FROM BORROWER: 225,478.27 420. GROSS AMOUNT DUE TO SELLER: 225,257.89
- ------------------------------------------------------------------------------------------------------------------------------------
500. AMOUNTS PAID BY OR IN BEHALF OF BORROWER: 500. REDUCTIONS IN AMOUNT DUE TO SELLER:
- ------------------------------------------------------------------------------------------------------------------------------------
501. Deposit or earnest money 10,000.00 501. Excess deposit (see instructions)
- ------------------------------------------------------------------------------------------------------------------------------------
502. Principal amount of new loan(s) 502. Settlement charges to seller(line 1400) 18,896.55
- ------------------------------------------------------------------------------------------------------------------------------------
503. Existing loan(s) taken subject to 503. Existing loan(s) taken subject to
- ------------------------------------------------------------------------------------------------------------------------------------
504. Add'l Deposit from Buyer 215,483.02 504. Payoff of first mortgage loan 187,897.72
- ------------------------------------------------------------------------------------------------------------------------------------
505. 505. Payoff of second mortgage loan
- ------------------------------------------------------------------------------------------------------------------------------------
506. 506.
- ------------------------------------------------------------------------------------------------------------------------------------
507. 507.
- ------------------------------------------------------------------------------------------------------------------------------------
508. 508.
- ------------------------------------------------------------------------------------------------------------------------------------
509. 509.
- ------------------------------------------------------------------------------------------------------------------------------------
Adjustment for Items unpaid by seller: Adjustment for Items unpaid by seller:
- ------------------------------------------------------------------------------------------------------------------------------------
510. City/town taxes to 510. City/town taxes to
- ------------------------------------------------------------------------------------------------------------------------------------
511. County taxes to 511. County taxes to
- ------------------------------------------------------------------------------------------------------------------------------------
512. Assessments to 512. Assessments to
- ------------------------------------------------------------------------------------------------------------------------------------
513. 513.
- ------------------------------------------------------------------------------------------------------------------------------------
514. 514.
- ------------------------------------------------------------------------------------------------------------------------------------
515. 515.
- ------------------------------------------------------------------------------------------------------------------------------------
516. 516.
- ------------------------------------------------------------------------------------------------------------------------------------
517. 517.
- ------------------------------------------------------------------------------------------------------------------------------------
518. 518.
- ------------------------------------------------------------------------------------------------------------------------------------
519. 519.
- ------------------------------------------------------------------------------------------------------------------------------------
520. TOTAL PAID BY/FOR BORROWER: 225,483.02 520. TOTAL REDUCTION AMOUNT DUE SELLER: 206,794.27
- ------------------------------------------------------------------------------------------------------------------------------------
600. CASH AT SETTLEMENT FROM/TO BORROWER: 600. CASH AT SETTLEMENT TO/FROM SELLER:
- ------------------------------------------------------------------------------------------------------------------------------------
601. Gross amount due from borrower(line 120) 225,478.27 601. Gross amount due to seller(line 420) 225,257.89
- ------------------------------------------------------------------------------------------------------------------------------------
602. Less amounts paid by/for borrower(line 220) 225,483.02 602. Less total reductions in amount due seller(line 520) 206,794.27
- ------------------------------------------------------------------------------------------------------------------------------------
603. CASH ( FROM) ( X TO) BORROWER: 4.75 603. CASH ( X TO) ( FROM) SELLER 18,463.62
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
????? FORM 1099 SELLER STATEMENT - The information contained in Blocks E,G,H,
and I and online 401 (or, if line 401 is asterisked lines 403 and 404) is
important tax information is being furnished to the Internal Revenue Service. If
you are required to file a return, a negligence penalty or other sanction will
be imposed on you if this item is required to be reported and the IRS determines
that it has not been reported.
????? INSTRUCTION - If this real estate was your principal residence, file Form
2119. Sale or Exchange of Principal residence, for any gain, with your income
tax return for other ?????, complete the applicable parts of Form 4797, Form
6252 and/or Schedule D (Form 1040).
????? are required by law to provide _______________________________ with your
correct taxpayer Identification number.
????? you do not provide __________________________________ with your correct
taxpayer Identification number, you may be subject to civil or criminal
penalties.
Per penalties of purgery I certify that the number shown on this statement is my
correct taxpayer identification number.
<PAGE>
<TABLE>
<CAPTION>
PAGE 2 OF OMB No. 2502-02
- ------------------------------------------------------------------------------------------------------------------------------------
File 97050264 See HUD attachment(s) for '*' items PAID FROM PAID FROM
Final L. SETTLEMENT CHARGES BORROWER'S SELLER'S
- ---------------------------------------------------------------------------------------
FUNDS FUNDS
700. TOTAL SALES/BROKER'S COMMISSION Based on $ @ % AT SETTLEMENT AT SETTLEMENT
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Division of Commission (line 700) as follows:
- ------------------------------------------------------------------------------------------------------------------------------------
701. to
702. to
Commission paid at settlement
- ------------------------------------------------------------------------------------------------------------------------------------
704. to
- ------------------------------------------------------------------------------------------------------------------------------------
800. ITEMS PAYABLE IN CONNECTION WITH LOAN.
- ------------------------------------------------------------------------------------------------------------------------------------
801. Loan Origination fee %
- ------------------------------------------------------------------------------------------------------------------------------------
802. Loan Discount %
- ------------------------------------------------------------------------------------------------------------------------------------
803. Appraisal fee to
- ------------------------------------------------------------------------------------------------------------------------------------
804. Credit Report to
- ------------------------------------------------------------------------------------------------------------------------------------
805. Lender's Inspection fee to
- ------------------------------------------------------------------------------------------------------------------------------------
806. Mortgage Insurance application fee to
- ------------------------------------------------------------------------------------------------------------------------------------
807. Assumption Fee to
- ------------------------------------------------------------------------------------------------------------------------------------
808. to
- ------------------------------------------------------------------------------------------------------------------------------------
809. to
- ------------------------------------------------------------------------------------------------------------------------------------
810. to
- ------------------------------------------------------------------------------------------------------------------------------------
811. to
- ------------------------------------------------------------------------------------------------------------------------------------
812. to
- ------------------------------------------------------------------------------------------------------------------------------------
900. ITEMS REQUIRED BY LENDER TO BE PAID IN ADVANCE.
- ------------------------------------------------------------------------------------------------------------------------------------
901. Interest from to @$ /day
- ------------------------------------------------------------------------------------------------------------------------------------
902. Mortgage Insurance premium for mo: to
- ------------------------------------------------------------------------------------------------------------------------------------
903. Hazard Insurance premium for yrs: to
- ------------------------------------------------------------------------------------------------------------------------------------
904. to
- ------------------------------------------------------------------------------------------------------------------------------------
905.
- ------------------------------------------------------------------------------------------------------------------------------------
1000. RESERVES DEPOSITED WITH LENDER
- ------------------------------------------------------------------------------------------------------------------------------------
1001. Hazard Insurance mo.@$ per mo.
- ------------------------------------------------------------------------------------------------------------------------------------
1002. Mortgage Insurance mo.@$ per mo.
- ------------------------------------------------------------------------------------------------------------------------------------
1003. City property taxes mo.@$ per mo.
- ------------------------------------------------------------------------------------------------------------------------------------
1004. County property taxes mo.@$ per mo.
- ------------------------------------------------------------------------------------------------------------------------------------
1005. Annual assessments (Maint.) mo.@$ per mo.
- ------------------------------------------------------------------------------------------------------------------------------------
1006. mo.@$ per mo.
- ------------------------------------------------------------------------------------------------------------------------------------
1007. mo.@$ per mo.
- ------------------------------------------------------------------------------------------------------------------------------------
1008. mo.@$ per mo.
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
1100. TITLE CHARGES:
- ------------------------------------------------------------------------------------------------------------------------------------
1101. Settlement or closing fee to STEWART TITLE OF NEVADA 212.38 212.38
- ------------------------------------------------------------------------------------------------------------------------------------
1102. Abstract of title search to
- ------------------------------------------------------------------------------------------------------------------------------------
1103. Title examination to
- ------------------------------------------------------------------------------------------------------------------------------------
1104. Title Insurance binder to
- ------------------------------------------------------------------------------------------------------------------------------------
1105. Document preparation to
- ------------------------------------------------------------------------------------------------------------------------------------
1106. Notary fee to
- ------------------------------------------------------------------------------------------------------------------------------------
1107. Attorney's fee to to
- ------------------------------------------------------------------------------------------------------------------------------------
(includes above items No.:
- ------------------------------------------------------------------------------------------------------------------------------------
1108. Title Insurance to STEWART TITLE OF NEVADA 897.50
- ------------------------------------------------------------------------------------------------------------------------------------
(includes above items No.:
- ------------------------------------------------------------------------------------------------------------------------------------
1109. Lender's coverage $
- ------------------------------------------------------------------------------------------------------------------------------------
1110. Owner's coverage 225,000.00 $ 897.50
- ------------------------------------------------------------------------------------------------------------------------------------
1111. RECONVEYANCE FEE to STEWART TITLE OF NEVADA 100.00
- ------------------------------------------------------------------------------------------------------------------------------------
1112. to
- ------------------------------------------------------------------------------------------------------------------------------------
1113. to
- ------------------------------------------------------------------------------------------------------------------------------------
1114. to
- ------------------------------------------------------------------------------------------------------------------------------------
1200. GOVERNMENT RECORDING AND TRANSFER CHARGES
- ------------------------------------------------------------------------------------------------------------------------------------
1201. Recording fee: Deed $ 8.00 Mrtg $ Rel.$ 7.00 8.00 7.00
- ------------------------------------------------------------------------------------------------------------------------------------
1202. City/county tax/stamps; Deed $ Mrtg $
- ------------------------------------------------------------------------------------------------------------------------------------
1203. State tax/stamps; Deed $ 562.50 Mrtg $ 562.50
- ------------------------------------------------------------------------------------------------------------------------------------
1204. to
- ------------------------------------------------------------------------------------------------------------------------------------
1205. to
- ------------------------------------------------------------------------------------------------------------------------------------
1206. to
- ------------------------------------------------------------------------------------------------------------------------------------
1300. ADDITIONAL SETTLEMENT CHARGES
- ------------------------------------------------------------------------------------------------------------------------------------
1301. Survey to
- ------------------------------------------------------------------------------------------------------------------------------------
1302. Pest Inspection to
- ------------------------------------------------------------------------------------------------------------------------------------
1303. to
- ------------------------------------------------------------------------------------------------------------------------------------
1304. to
- ------------------------------------------------------------------------------------------------------------------------------------
1305. See HUD attachment to * 17,117.17
- ------------------------------------------------------------------------------------------------------------------------------------
1400. TOTAL SETTLEMENT CHARGES (entered on lines 103, Section I and 502, Section k) 220.38 18,896.55
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
CERTIFICATION
I have carefully reviewed the HUD-1 Settlement Statement and to the best of my
knowledge and belief, it is a true and accurate statement of all receipts and
disbursements made on my account or by me in this transaction. I further certify
that I have received a copy of HUD-1 Settlement Statement.
_______________________________ _______________________________
_______________________________ _______________________________
Borrowers Sellers
The HUD-1 Settlement, Statement which I have prepared is a true and accurate
account of this transaction. I have caused or will cause the funds to be
disbursed in accordance with this statement.
_______________________________ _______________________________
Settlement Agent Date
WARNING: It is a crime to knowingly make false statements to the United States
on this or any other similar form Penalties
<PAGE>
HUD-2 Settlement Statement Attachment, Page 1
File number.....: 97050264
Buyer(s)........: MEADOW VALLEY CONTRACTORS, INC.
Seller(s).......: WARM SPRINGS R.V. PARK, INC.
Lender..........: Loan Number:
- --------------------------------------------------------------------------------
Continued From HUD Form Page 2
Borrower's Adjustments Seller's Adjustments
- -1305- -1305-
CHARLES AND CAROL WILLIAMS
to CHARLES WILLIAMS AND 5,000.00
DELINQUENT TAXES
to CLARK COUNTY TREASURER 2,177.17
EARLY RELEASE OF FUNDS
to DENNIS PULSIPHER 10,000.00
-----------------
Total for HUD line 1305: 17,117.17
<PAGE>
GRANT, BARGAIN SALE DEED
Affix RPTT $ 562.50
---------
FOR VALUABLE CONSIDERATION the receipt of which is hereby acknowledged
WARM SPRINGS R.V.PARK, INC., a NEVADA CORPORATION
do(es) hereby Grant, Bargain, Sell and convey to MEADOW VALLEY CONTRACTORS,
INC., a Nevada corporation
all that real property situate in the _____________________ County of CLARK
State of Nevada, bounded and described as follows:
"FOR FULL LEGAL DESCRIPTION, SEE EXHIBIT "A" ATTACHED HERETO AND BY REFERENCE
MADE A PART HEREOF"
A.P.N-: 609-210-013
--------------
SUBJECT TO: 1. Taxes for fiscal year 1997 - 1998.
2. Reservations, restrictions and conditions if any; rights of way
and easements either of record or actually existing on said
premises.
Together with all and singular the tenements, hereditaments and appurtenances
thereto belonging in otherwise appertaining.
DATED: November 05,1997
-------------------------
WARM SPRING R.V. PARK, INC.
/s/ Dennis Pulsipher
- -------------------------------- _____________________________
BY: DENNIS PULSIPHER, PRESIDENT
________________________________ _____________________________
________________________________ _____________________________
STATE OF NEVADA
COUNTY OF Clark } "
------------
On November 12, 1997
- ------------------------------
before me, the undersigned, ESCROW NO.
a Notary Public in and for ORDER NO. } 97050264
--------------
said County and State,
personally appeared
BY: Dennis Pulsipher WHEN RECORDED MAIL TO: Meadow Valley Con-
______________________________ ------------------
tractors, Inc., P.O. Box 549, Moapa, NV
______________________________ -----------------------------------------
89025
______________________________ -----------------------------------------
_________________________________________
______________________________
known to me to be the person(s)
described in and who executed the
foregoing instrument, who acknow-
ledged to me that he executed the
same freely and voluntarily and
for the uses and purposes
therein mentioned.
WITNESS my hand and official seal.
SIGNATURE ILLEGIBLE
- ------------------------
[STAMP APPEARS HERE]
<PAGE>
EXHIBIT "A"
-----------
PARCEL I:
That portion of the Northwest Quarter (NW 1/4) of said Section 2, lying
Southerly and Westerly of U.S. Highway No. 93, and Northerly and Westerly of the
Muddy River.
EXCEPTING THEREFROM all that portion of said land lying Northerly of Riverview
Road, as conveyed to Clark County by Deed recorded March 16, 1978 as Document
No. 819125.
PARCEL II:
That portion of the North Half (N 1/2) of the Southwest Quarter (SW 1/4) of said
Section 2, lying Northerly of the Los Angeles and Salt Lake Railroad right of
way, and Westerly of the Muddy River.
EXCEPTING THEREFROM all state, County and Federal road and highways from both
Parcels 1 and 2.
[STAMP]
<PAGE>
EXHIBIT 10.57
PROMISSORY NOTE
December 4, 1997
------------------
(DATE)
3430 E. FLAMINGO, SUITE 100, LAS VEGAS, CLARK COUNTY, NV 89121
________________________________________________________________________________
(ADDRESS OF MAKER)
FOR VALUE RECEIVED, READY MIX, INC. ("MAKER") promises, jointly and severally if
more than one, to pay to the order of General Electric Capital Corporation or
any subsequent holder hereof (each, a "PAYEE") at its office located at 8480
ORCHARD ROAD SUITE 5000, ENGLEWOOD, CO 80111 or at such other place as Payee or
the holder hereof may designate, the principal sum of the SIX HUNDRED SEVENTY
FIVE THOUSAND SIX HUNDRED TEN AND 52/100 DOLLARS ($675,610.52), with interest on
the unpaid principal balance, from the date hereof through and including the
dates of payment, at a fixed, simple interest rate of Eight and 13/100 percent
(8.13%) per annum, to be paid in lawful money of the United States, in Fifty
Nine (59) consecutive monthly installments of principal and interest of THIRTEEN
THOUSAND SEVEN HUNDRED FORTY ONE AND 02/100 DOLLARS ($13,741.02) each ("PERIODIC
INSTALLMENT") and a final installment which shall be in the amount of the total
outstanding principal and interest. The first Periodic Installment shall be due
and payable on January 4, 1998 and the following Periodic Installments and the
final installments shall be due and payable on the same day of each succeeding
period (each, a "PAYMENT DATE").
All payments shall be applied first to interest and then to principal. The
acceptance by Payee of any payment which is less than payment in full of all
amounts due and owing at such time shall not constitute a waiver of Payee's
right to receive payment in full at such time or at any prior or subsequent
time. Interest shall be calculated on the basis of a 365 day year (366 day leap
year). The payment of any Periodic Installment after its due date shall result
in a corresponding decrease in the portion of the Periodic Installment credited
to the remaining unpaid principal balance. The payment of any Periodic
Installment prior to its due date shall result in a corresponding increase in
the portion of the Periodic Installment credited to the remaining unpaid
principal balance.
The Maker hereby expressly authorizes the Payee to insert the date value is
actually given in the blank space on the face hereof and on all related
documents pertaining hereto.
This Note may be secured by a security agreement, chattel mortgage, pledge
agreement or like instrument (each of which is hereinafter called a "SECURITY
AGREEMENT").
Time is of the essence hereof. If any installment or any other sum due under
this Note or any Security Agreement is not received within ten (10) days after
its due date, the Maker agrees to pay, in addition to the amount of each such
installment or other sum, a late payment charge of five percent (5%) of the
amount of said installment or other sum, but not exceeding any lawful maximum.
If (i) Maker fails to make payment of any amount due hereunder within ten (10)
days after the same becomes due and payable; or (ii) Maker is in default, or
fails to perform, under any term or condition contained in any Security
Agreement, then the entire principal sum remaining unpaid, together with all
accrued interest thereon and any other sum payable under this Note or any
Security Agreement, at the election of Payee, shall immediately become due and
payable, with interest thereon at the lesser of eighteen percent (18%) per annum
or the highest rate not prohibited by applicable law from the date of such
accelerated maturity until paid (both before and after any judgment).
The Maker may prepay in full, or in part, its entire indebtedness hereunder upon
payment of an additional sum as a premium equal to the following percentages of
the original principal balance for the indicated period:
Prior to the first annual anniversary date of this Note: three percent (3%)
Thereafter and prior to the second annual anniversary
date of this Note: zero percent (0%)
Thereafter and prior to the third annual anniversary date
of this Note: zero percent (0%)
Thereafter and prior to the fourth annual anniversary date
of this Note: zero percent (0%)
Thereafter and prior to the fifth annual anniversary date
of this Note: zero percent (0%)
and zero percent (0%) thereafter, plus all other sums due hereunder or under
any Security Agreement.
It is the intention of the parties hereto to comply with the applicable usury
laws; accordingly, it is agreed that, notwithstanding any provision to the
contrary in this Note or any Security Agreement, in no event shall this Note or
any Security Agreement require the payment or permit the collection of interest
in excess of the maximum amount permitted by applicable law. If any such excess
interest is contracted for, charged or received under this Note or any Security
Agreement or if all of the principle balance shall be prepaid, so that under any
of such circumstances the amount of interest contracted for, charged or received
under this Note of any Security Agreement on the principal balance shall exceed
the maximum amount of interest permitted by applicable law, then in such event
(a) the provisions of this paragraph shall govern and control, (b) neither Maker
nor any other person or entity now or hereafter liable for the payment hereof
shall be obligated to pay the amount of such interest to the extent that it is
in excess of the maximum amount of interest permitted by applicable law, (c) any
such excess which may have been collected shall be either applied as a credit
against the then unpaid principal balance or refunded to Maker, at the option of
the Payee, and (d) the effective rate of interest shall be automatically reduced
to the maximum lawful contract rate allowed under applicable law as now or
hereafter construed by the courts having jurisdiction thereof. It is further
agreed that without limitation of the foregoing, all calculations of the rate of
interest contracted for, charged or received under this Note or any Security
Agreement which are made for the purpose of determining whether such rate
exceeds the maximum lawful contract rate, shall be made, to the extent permitted
by applicable law, by amortizing, prorating, allocating and spreading in equal
parts during the period of the full stated term of the indebtedness evidenced
hereby, all interest at any time contracted for, charged or received from Maker
or otherwise by Payee in connection with such indebtedness; provided, however,
that if any applicable state law is amended or the law of the United States of
America preempts any applicable state law, so that it becomes lawful for the
Payee to receive a greater interest per annum rate than is presently allowed,
the Maker agrees that, on the effective date of such amendment or preemption, as
the case may be, the lawful maximum hereunder shall be increased to the maximum
interest per annum rate allowed by the amended state law or the law of the
United States of America.
The Maker and all sureties, endorsers, guarantors or any others (each such
person, other than the Maker, an "OBLIGOR") who may at any time become liable
for the payment hereof jointly and severally consent hereby to any and all
extensions of time, renewals, waivers or modifications of, and all substitutions
or releases of, security or of any party primarily or secondarily liable on this
Note or any Security Agreement or any term and provision of either, which may be
made, granted or consented to by Payee, and agree that suit may be brought and
maintained against any one or more of them, at the election of Payee without
joinder of any other as a party thereto, and that Payee shall not be required
first to foreclose, proceed against, or exhaust any security hereof in order to
enforce payment of this Note. The Maker and each Obligor hereby waives
presentment, demand for payment, notice of nonpayment, protest,
<PAGE>
notice of protest, notice of dishonor, and all other notices in connection
herewith, as well as filing of suit (if permitted by law) and diligence in
collecting this Note or enforcing any of the security hereof, and agrees to pay
(if permitted by law) all expenses incurred in collection, including Payee's
attorneys' fees.
THE MAKER HEREBY UNCONDITIONALLY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM
OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF, DIRECTLY OR INDIRECTLY, THIS
NOTE, ANY OF THE RELATED DOCUMENTS, AND DEALINGS BETWEEN MAKER AND PAYEE
RELATING TO THE SUBJECT MATTER OF THIS TRANSACTION OR ANY RELATED TRANSACTIONS,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN MAKER AND PAYEE. THE
SCOPE OF THIS WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES
THAT MAY BE FILED IN ANY COURT (INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS,
TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY
CLAIMS.) THIS WAIVER IS IRREVOCABLE MEANING THAT IT MAY NOT BE MODIFIED EITHER
ORALLY OR IN WRITING, AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS NOTE, ANY RELATED DOCUMENTS, OR
TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THIS TRANSACTION OR ANY RELATED
TRANSACTION. IN THE EVENT OF LITIGATION, THIS NOTE MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.
This Note and any Security Agreement constitute the entire agreement of the
Maker and Payee with respect to the subject matter hereof and supercedes all
prior understandings, agreements and representations, express or implied.
No variation or modification of this Note, or any waiver of any of its
provisions or conditions, shall be valid unless in writing and signed by an
authorized representative of Maker and Payee. Any such waiver, consent,
modification or change shall be effective only in the specific instance and for
the specific purpose given.
Any provision in this Note or any Security Agreement which is in conflict with
any statute, law or applicable rule shall be deemed omitted, modified or altered
to confirm thereto.
READY MIX, INC.
/s/ Julie L. Bergo By: /s/ Kenneth D. Nelson (L.S.)
- ----------------------------------- -------------------------------
(Witness) (Signature)
/s/ Julie L. Bergo /s/ Kenneth D. Nelson, Vice President
- ----------------------------------- ----------------------------------
(Print name) Print name (and title, if applicable)
4411 So 40th St. Sc D-11 Phx. 860830443
- ----------------------------------- ------------------------------------
(Address) (Federal tax identification number)
<PAGE>
EXHIBIT 10.58
PROMISSORY NOTE
NOVEMBER 17, 1997
-------------------
(DATE)
SUITE D-11, 4411 S 40th STREET, PHOENIX, MARICOPA COUNTY, AZ 85082
________________________________________________________________________________
(ADDRESS OF MAKER)
FOR VALUE RECEIVED, MEADOW VALLEY CONTRACTORS, INC. ("MAKER") promises, jointly
and severally if more than one, to pay to the order of GENERAL ELECTRIC CAPITAL
CORPORATION or any subsequent holder hereof (each, a "PAYEE") at its office
located at 8480 ORCHARD ROAD SUITE 5000, ENGLEWOOD, CO 80111 or at such other
place as Payee or the holder hereof may designate, the principal sum of SIX
HUNDRED THIRTY TWO THOUSAND FOUR HUNDRED FIFTY ONE AND 40/100 DOLLARS
($632,451.40), with interest on the unpaid principal balance, from the date
hereof through and including the dates of payment, at a fixed, simple interest
rate of EIGHT AND 13/100 PERCENT (8.13%) per annum, to be paid in lawful money
of the United States, in FIFTY NINE (59) consecutive monthly installments of
principal and interest of TWELVE THOUSAND EIGHT HUNDRED SIXTY THREE AND 22/100
DOLLARS ($12,863.22) each ("PERIODIC INSTALLMENT") and a final installment which
shall be in the amount of the total outstanding principal and interest. The
first Periodic Installment shall be due and payable on DECEMBER 17, 1997 and the
following Periodic Installments and the final installments shall be due and
payable on the same day of each succeeding period (each, a "PAYMENT DATE").
All payments shall be applied first to interest and then to principal. The
acceptance by Payee of any payment which is less than payment in full of all
amounts due and owing at such time shall not constitute a waiver of Payee's
right to receive payment in full at such time or any prior or subsequent time.
Interest shall be calculated on the basis of a 365 day year (366 day leap year).
The payment of any Periodic Installment after its due date shall result in a
corresponding decrease in the portion of the Periodic Installment credited to
the remaining unpaid principal balance. The payment of any Periodic Installment
prior to its due date shall result in a corresponding increase in the portion of
the Periodic Installment credited to the remaining unpaid principal balance.
The Maker hereby expressly authorizes the Payee to insert the date value is
actually given in the blank space on the face hereof and on all related
documents pertaining hereto.
This Note may be secured by a security agreement, chattel mortgage, pledge
agreement or like instrument (each of which is hereinafter called a "SECURITY
AGREEMENT").
Time is of the essence hereof. If any installment or any other sum due under
this Note or any Security Agreement is not received within ten (10) days after
its due date, the Maker agrees to pay, in addition to the amount of each such
installment or other sum, a late payment charge of Three percent (3%) of the
amount of said installment or other sum, but not exceeding any lawful maximum.
If (i) Maker fails to make payment of any amount due hereunder within ten (10)
days after the same becomes due and payable; or (ii) Maker is in default, or
fails to perform, under any term or condition contained in any Security
Agreement, then the entire principal sum remaining unpaid, together with all
accrued interest thereon and any other sum payable under this Note or any
Security Agreement, at the election of Payee, shall immediately become due and
payable, with interest thereon at the lesser of eighteen percent (18%) per annum
or the highest rate not prohibited by applicable law from the date of such
accelerated maturity until paid (both before and after any judgment).
The Maker may prepay in full, or in part, its indebtedness hereunder upon
payment of an additional sum as a premium equal to the following percentages of
the original principal balance for the indicated period:
Prior to the first annual anniversary date of this Note: three percent (3%)
Thereafter and prior to the second annual anniversary
date of this Note: zero percent (0%)
Thereafter and prior to the third annual anniversary date
of this Note: zero percent (0%)
Thereafter and prior to the fourth annual anniversary date
of this Note: zero percent (0%)
Thereafter and prior to the fifth annual anniversary date
of this Note: zero percent (0%)
and zero percent (0%) thereafter, plus all other sums due hereunder or under any
Security Agreement.
It is the intention of the parties hereto to comply with the applicable usury
laws; accordingly, it is agreed that, notwithstanding any provision to the
contrary in this Note or any Security Agreement, in no event shall this Note or
any Security Agreement require the payment or permit the collection of interest
in excess of the maximum amount permitted by applicable law. If any such excess
interest is contracted for, charged or received under this Note or any Security
Agreement, or if all of the the principal balance shall be prepaid, so that
under any of such circumstances the amount of interest contracted for, charged
or received under this Note or any Security Agreement on the principal balance
shall exceed the maximum amount of interest permitted by applicable law, then in
such event (a) the provisions of this paragraph shall govern and control, (b)
neither Maker nor any other person or entity now or hereafter liable for the
payment hereof shall be obligated to pay the amount of such interest to the
extent that it is in excess of the maximum amount of interest permitted by
applicable law, (c) any such excess which may have been collected shall be
either applied as a credit against the then unpaid principal balance or refunded
to Maker, at the option of the Payee, and (d) the effective rate of interest
shall be automatically reduced to the maximum lawful contract rate allowed under
applicable law as now or hereafter construed by the courts having jurisdiction
thereof. It is further agreed that without limitation of the foregoing, all
calculations of the rate of interest contracted for, charged or received under
this Note or any Security Agreement which are made for the purpose of
determining whether such rate exceeds the maximum lawful contract rate, shall be
made, to the extent permitted by applicable law, by amortizing, prorating,
allocating and spreading in equal parts during the period of the full stated
term of the indebtedness evidenced hereby, all interest at any time contracted
for, charged or received from Maker or otherwise by Payee in connection with
such indebtedness; provided, however, that if any applicable state law is
amended or the law of the United States of America preempts any applicable state
law, so that it becomes lawful for the Payee to receive a greater interest per
annum rate than is presently allowed, the Maker agrees that, on the effective
date of such amendment or preemption, as the case may be, the lawful maximum
hereunder shall be increased to the maximum interest per annum rate allowed by
the amended state law or the law of the United States of America.
The Maker and all sureties, endorsers, guarantors or any others (each such
person, other than the Maker, an "OBLIGOR") who may at any time become liable
for the payment hereof jointly and severally consent hereby to any and all
extensions of time, renewals, waivers or modifications of, and all substitutions
or releases of, security or of any party primarily or secondarily liable on this
Note or any Security Agreement or any term and provision of either, which may be
made, granted or consented to by Payee, and agree that suit may be brought and
maintained against any one or more of them, at the election of Payee without
joinder of any other as a party thereto, and that Payee shall not be required
first to foreclose, proceed against, or exhaust any security hereof in order to
enforce payment of this Note. The Maker and each Obligor hereby waives
presentment, demand for payment, notice of nonpayment, protest,
<PAGE>
notice of protest, notice of dishonor, and all other notice in connection
herewith, as well as filing of suit (if permitted by law) and and diligence in
collecting this Note or enforcing any of the security hereof, and agrees to pay
(if permitted by law) all expenses incurred in collection, including Payee's
reasonable attorneys' fees.
THE MAKER HEREBY UNCONDITIONALLY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM
OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF, DIRECTLY OR INDIRECTLY, THIS
NOTE, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS BETWEEN MAKER AND PAYEE
RELATING TO THE SUBJECT MATTER OF THIS TRANSACTION OR ANY RELATED TRANSACTIONS,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN MAKER AND PAYEE. THE
SCOPE OF THIS WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES
THAT MAY BE FILED IN ANY COURT (INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS,
TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY
CLAIMS.) THIS WAIVER IS IRREVOCABLE MEANING THAT IT MAY NOT BE MODIFIED EITHER
ORALLY OR IN WRITING, AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS NOTE, ANY RELATED DOCUMENTS, OR
TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THIS TRANSACTION OR ANY
RELATED TRANSACTION. IN THE EVENT OF LITIGATION, THIS NOTE MAY BE FILED AS A
WRITTEN CONSENT TO A TRIAL BY THE COURT.
This Note and any Security Agreement constitute the entire agreement of the
Maker and Payee with respect to the subject matter hereof and supercedes all
prior understandings, agreements and representations, express or implied.
No variation or modification of this note, or any waiver of any of its
provisions or conditions, shall be valid unless in writing and signed by an
authorized representative of Maker and Payee. Any such waiver, consent,
modification or change shall be effective only in the specific instance and for
the specific purpose given.
Any provision in this Note or any Security Agreement which is in conflict with
any statute, law or applicable rule shall be deemed omitted, modified or
altered to conform thereto.
MEADOW VALLEY CONTRACTORS, INC.
/s/ Julie L. Bergo BY: /s/ Gary W. Burnell
- ----------------------------------- -----------------------------(L.S.)
(Witness) (Signature)
Julie L. Bergo Gary W. Burnell, VP/CFO
- ----------------------------------- --------------------------------
(Print name) Print name (and title, if applicable)
4411 S. 40th St Ste D-11 880171959
- ----------------------------------- ---------------------------------
(Address) Phoenix 85040 (Federal tax identification Number)
Arizona
<PAGE>
EXHIBIT 10.59
PROMISSORY NOTE
December 31, 1997
-------------------
(DATE)
SUITE D-11, 4411 S 40th STREET, PHOENIX, MARICOPA COUNTY, AZ 85082
________________________________________________________________________________
(ADDRESS OF MAKER)
FOR VALUE RECEIVED, MEADOW VALLEY CONTRACTORS, INC. ("MAKER") promises, jointly
and severally if more than one, to pay to the order of GENERAL ELECTRIC CAPITAL
CORPORATION or any subsequent holder hereof (each, a "PAYEE") at its office
located at 8480 ORCHARD ROAD SUITE 5000, ENGLEWOOD, CO 80111 or at such other
place as Payee or the holder hereof may designate, the principal sum of ONE
HUNDRED FORTY FOUR THOUSAND SEVEN HUNDRED FOURTEEN AND NO/100 DOLLARS
($144,714.00), with interest on the unpaid principal balance, from the date
hereof through and including the dates of payment, at a fixed, simple interest
rate of EIGHT AND 13/100 PERCENT (8.13%) per annum, to be paid in lawful money
of the United States, in FIFTY NINE (59) consecutive monthly installments of
principal and interest of TWO THOUSAND NINE HUNDRED FORTY THREE AND 95/100
DOLLARS ($2,943.95) each ("PERIODIC INSTALLMENT") and a final installment which
shall be in the amount of the total outstanding principal and interest. The
first Periodic Installment shall be due and payable on FEBRUARY 1, 1998 and the
following Periodic Installments and the final installment shall be due and
payable on the same day of each succeeding period (each, a "PAYMENT DATE").
All payments shall be applied first to interest and then to principal. The
acceptance by Payee of any payment which is less than payment in full of all
amounts due and owing at such time shall not constitute a waiver of Payee's
right to receive payment in full at such time or any prior or subsequent time.
Interest shall be calculated on the basis of a 365 day year (366 day leap year).
The payment of any Periodic Installment after its due date shall result in a
corresponding decrease in the portion of the Periodic Installment credited to
the remaining unpaid principal balance. The payment of any Periodic Installment
prior to its due date shall result in a corresponding increase in the portion of
the Periodic Installment credited to the remaining unpaid principal balance.
The Maker hereby expressly authorizes the Payee to insert the date value is
actually given in the blank space on the face hereof and on all related
documents pertaining hereto.
This Note may be secured by a security agreement, chattel mortgage, pledge
agreement or like instrument (each of which is hereinafter called a "SECURITY
AGREEMENT.")
Time is of the essence hereof. If any installment or any other sum due under
this Note or any Security Agreement is not received within ten (10) days after
its due date, the Maker agrees to pay, in addition to the amount of each such
installment or other sum, a late payment charge of three percent (3%) of the
amount of said installment or other sum, but not exceeding any lawful maximum.
If (i) Maker fails to make payment of any amount due hereunder within ten (10)
days after the same becomes due and payable; or (ii) Maker is in default, or
fails to perform, under any term or condition contained in any Security
Agreement, then the entire principal sum remaining unpaid, together with all
accrued interest thereon and any other sum payable under this Note or any
Security Agreement, at the election of Payee, shall immediately become due and
payable, with interest thereon at the lesser of eighteen percent (18%) per annum
or the highest rate not prohibited by applicable law from the date of such
accelerated maturity until paid (both before and after any judgment).
The Maker may prepay in full, or in part, its indebtedness hereunder upon
payment of an additional sum as a premium equal to the following percentages of
the original principal balance for the indicated period:
Prior to the first annual anniversary date of this Note: three percent (3%)
Thereafter and prior to the second annual anniversary
date of this Note: zero percent (0%)
Thereafter and prior to the third annual anniversary date
of this Note: zero percent (0%)
Thereafter and prior to the fourth annual anniversary date
of this Note: zero percent (0%)
Thereafter and prior to the fifth annual anniversary date
of this Note: zero percent (0%)
and zero percent (0%) thereafter, plus all other sums due hereunder or under any
Security Agreement.
It is the intention of the parties hereto to comply with the applicable usury
laws; accordingly, it is agreed that, notwithstanding any provision to the
contrary in this Note or any Security Agreement, in no event shall this Note or
any Security Agreement require the payment or permit the collection of interest
in excess of the maximum amount permitted by applicable law. If any such excess
interest is contracted for, charged or received under this Note or any Security
Agreement or if all of the principal balance shall be prepaid, so that under any
of such circumstances the amount of interest contracted for, charged or received
under this Note or any Security Agreement on the principal balance shall exceed
the maximum amount of interest permitted by applicable law, then in such event
(a) the provisions of this paragraph shall govern and control, (b) neither Maker
nor any other person or entity now or hereafter liable for the payment hereof
shall be obligated to pay the amount of such interest to the extent that it is
in excess of the maximum amount of interest permitted by applicable law, (c) any
such excess which may have been collected shall be either applied as a credit
against the then unpaid principal balance or refunded to Maker, at the option of
the Payee, and (d) the effective rate of interest shall be automatically reduced
to the maximum lawful contract rate allowed under applicable law as now or
hereafter construed by the courts having jurisdiction thereof. It is further
agreed that without limitation of the foregoing, all calculations of the rate of
interest contracted for, charged or received under this Note or any Security
Agreement which are made for the purpose of determining whether such rate
exceeds the maximum lawful contract rate, shall be made, to the extent permitted
by applicable law, by amortizing, prorating, allocating and spreading in equal
parts during the period of the full stated term of the indebtedness evidenced
hereby, all interest at any time contracted for, charged or received from Maker
or otherwise by Payee in connection with such indebtedness; provided, however,
that if any applicable state law is amended or the law of the United States of
America preempts any applicable state law, so that it becomes lawful for the
Payee to receive a greater interest per annum rate than is presently allowed,
the Maker agrees that, on the effective date of such amendment or preemption, as
the case may be, the lawful maximum hereunder shall be increased to the maximum
interest per annum rate allowed by the amended state law or the law of the
United States of America.
The Maker and all sureties, endorsers, guarantors or any others (each such
person, other than the Maker, an "OBLIGOR") who may at any time become liable
for the payment hereof jointly and severally consent hereby to any and all
extensions of time, renewals, waivers or modifications of, and all substitutions
or releases of, security or of any party primarily or secondarily liable on
this Note or any Security Agreement or any term and provision of either, which
may be made, granted or consented to by Payee, and agree that suit may be
brought and maintained against any one or more of them, at the election of Payee
without joinder of any other as a party thereto, and that Payee shall not be
required first to foreclose, proceed against, or exhaust any security hereof in
order to enforce payment of this Note. The Maker and each Obligor hereby waives
presentment, demand for payment, notice of nonpayment, protest,
<PAGE>
notice of protest, notice of dishonor, and all other notices in connection
herewith, as well as filing of suit (if permitted by law and) and diligence in
collecting this Note or enforcing any of the security hereof, and agrees to pay
(if permitted by law) all expenses incurred in collection, including Payee's
reasonable attorneys' fees.
THE MAKER HEREBY UNCONDITIONALLY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM
OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF, DIRECTLY OR INDIRECTLY, THIS
NOTE, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS BETWEEN MAKER AND PAYEE
RELATING TO THE SUBJECT MATTER OF THIS TRANSACTION OR ANY RELATED TRANSACTIONS,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN MAKER AND PAYEE. THE
SCOPE OF THIS WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES
THAT MAY BE FILED IN ANY COURT (INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS,
TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY
CLAIMS.) THIS WAIVER IS IRREVOCABLE MEANING THAT IT MAY NOT BE MODIFIED EITHER
ORALLY OR IN WRITING, AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS NOTE, ANY RELATED DOCUMENTS, OR
TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THIS TRANSACTION OR ANY RELATED
TRANSACTION. IN THE EVENT OF LITIGATION, THIS NOTE MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.
This Note and any Security Agreement constitute the entire agreement of the
Maker and Payee with respect to the subject matter hereof and supercedes all
prior understandings, agreements and representations, express or implied.
No variation or modification of this Note, or any waiver of any of its
provisions or conditions, shall be valid unless in writing and signed by an
authorized representative of Maker and Payee. Any such waiver, consent,
modification or change shall be effective only in the specific instance and for
the specific purpose given.
Any provision in this Note or any Security Agreement which is in conflict with
any statute, law or applicable rule shall be deemed omitted, modified or
altered to conform thereto.
MEADOW VALLEY CONTRACTORS, INC.
/s/ Julie L. Bergo BY: /s/ Gary W. Burnell (L.S.)
- ----------------------------------- -----------------------------
(Witness) (Signature)
Julie L. Bergo Gary W. Burnell, VP/CFO
- ----------------------------------- --------------------------------
(Print name) Print name (and title, if applicable)
4411 S. 40th St Ste D-11 Phoenix
AZ 85040 880171959
- ----------------------------------- ---------------------------------
(Address) (Federal tax identification Number)
<PAGE>
EXHIBIT 10.60
PROMISSORY NOTE
December 30, 1997
-------------------
(DATE)
SUITE D-11, 4411 S 40th STREET, PHOENIX, MARICOPA COUNTY, AZ 85082
________________________________________________________________________________
(ADDRESS OF MAKER)
FOR VALUE RECEIVED, MEADOW VALLEY CONTRACTORS, INC. ("MAKER") promises, jointly
and severally if more than one, to pay to the order of General ELECTRIC CAPITAL
CORPORATION or any subsequent holder hereof (each, a "PAYEE") at its office
located at 8480 ORCHARD ROAD SUITE 5000, ENGLEWOOD, CO 80111 or at such other
place as Payee or the holder hereof may designate, the principal sum of ONE
HUNDRED FIFTY FOUR THOUSAND SEVEN HUNDRED ONE AND 94/100 DOLLARS ($154,701.94),
with interest on the unpaid principal balance, from the date hereof through and
including the dates of payment, at a fixed, simple interest rate of EIGHT AND
13/100 percent (8.13%) per annum, to be paid in lawful money of the United
States, in FIFTY NINE (59) consecutive monthly installments of principal and
interest of THREE THOUSAND ONE HUNDRED FORTY SEVEN AND 85/100 DOLLARS
($3,147.85) each ("PERIODIC INSTALLMENT") and a final installment which shall be
in the amount of the total outstanding principal and interest. The first
Periodic Installment shall be due and payable on FEBRUARY 1, 1998 and the
following Periodic Installments and the final installment shall be due and
payable on the same day of each succeeding period (each, A "PAYMENT DATE").
All payments shall be applied first to interest and then to principal. The
acceptance by Payee of any payment which is less than payment in full of all
amounts due and owing at such time shall not constitute a waiver of Payee's
right to receive payment in full at such time or any prior or subsequent time.
Interest shall be calculated on the basis of a 365 day year (366 day leap year).
The payment of any Periodic Installment after its due date shall result in a
corresponding decrease in the portion of the Periodic Installment credited to
the remaining unpaid principal balance. The payment of any Periodic Installment
prior to its due date shall result in a corresponding increase in the portion of
the Periodic Installment credited to the remaining unpaid principal balance.
The Maker hereby expressly authorizes the Payee to insert the date value is
actually given in the blank space on the face hereof and on all related
documents pertaining hereto.
This Note may be secured by a security agreement, chattel mortgage, pledge
agreement or like instrument (each of which is hereinafter called a "SECURITY
AGREEMENT").
Time is of the essence hereof. If any installment or any other sum due under
this Note or any Security Agreement is not received within ten (10) days after
its due date, the Maker agrees to pay, in addition to the amount of each such
installment or other sum, a late payment charge of three percent (3%) of the
amount of said installment or other sum, but not exceeding any lawful maximum.
If (i) Maker fails to make payment of any amount due hereunder within ten (10)
days after the same becomes due and payable; or (ii) Maker is in default, or
fails to perform, under any term or condition contained in any Security
Agreement, then the entire principal sum remaining unpaid, together with all
accrued interest thereon and any other sum payable under this Note or any
Security Agreement, at the election of Payee, shall immediately become due and
payable, with interest thereon at the lesser of eighteen percent (18%) per annum
or the highest rate not prohibited by applicable law from the date of such
accelerated maturity until paid (both before and after any judgment).
The Maker may prepay in full, or in part, its indebtedness hereunder upon
payment of an additional sum as a premium equal to the following percentages of
the original principal balance for the indicated period:
Prior to the first annual anniversary date of this Note: three percent (3%)
Thereafter and prior to the second annual anniversary
date of this Note: zero percent (0%)
Thereafter and prior to the third annual anniversary date
of this Note: zero percent (0%)
Thereafter and prior to the fourth annual anniversary date
of this Note: zero percent (0%)
Thereafter and prior to the fifth annual anniversary date
of this Note: zero percent (0%)
and zero percent (0%) thereafter, plus all other sums due hereunder or under
any Security Agreement.
It is the intention of the parties hereto to comply with the applicable usury
laws; accordingly, it is agreed that, notwithstanding any provision to the
contrary in this Note or any Security Agreement, in no event shall this Note or
any Security Agreement require the payment or permit the collection of interest
in excess of the maximum amount permitted by applicable law. If any such excess
interest is contracted for, charged or received under this Note or any Security
Agreement,or if all of the principal balance shall be prepaid, so that under any
of such circumstances the amount of interset contracted for, charged or received
under this Note or any Security Agreement on the principal balance shall exceed
the maximum amount of interest permitted by applicable law, then in such event
(a) the provisions of this paragraph shall govern and control, (b) neither Maker
nor any other person or entity now or hereafter liable for the payment hereof
shall be obligated to pay the amount of such interest to the extent that it is
in excess of the maximum amount of interest permitted by applicable law, (c) any
such excess which may have been collected shall be either applied as a credit
against the then unpaid principal balance or refunded to Maker, at the option of
the Payee, and (d) the effective rate of interest shall be automatically reduced
to the maximum lawful contract rate allowed under applicable law as now or
hereafter construed by the courts having jurisdiction thereof. It is further
agreed that without limitation of the foregoing, all calculations of the rate of
interest contracted for, charged or received under this Note or any Security
Agreement which are made for the purpose of determining whether such rate
exceeds the maximum lawful contract rate, shall be made, to the extent permitted
by applicable law, by amortizing, prorating, allocating and spreading in equal
parts during the period of the full stated term of the indebtedness evidenced
hereby, all interest at any time contracted for, charged or received from Maker
or otherwise by Payee in connection with such indebtedness; provided, however,
that if any applicable state law is amended or the law of the United States of
America preempts any applicable state law, so that it becomes lawful for the
Payee to receive a greater interest per annum rate than is presently allowed,
the Maker agrees that, on the effective date of such amendment or preemption, as
the case may be, the lawful maximum hereunder shall be increased to the maximum
interest per annum rate allowed by the amended state law or the law of the
United States of America.
The Maker and all sureties, endorsers, guarantors or any others (each such
person, other than the Maker, an "OBLIGOR") who may at any time become liable
for the payment hereof jointly and severally consent hereby to any and all
extensions of time, renewals, waivers or modifications of, and all substitutions
or releases of, security or of any party primarily or secondarily liable on
this Note or any Security Agreement or any term and provision of either, which
may be made, granted or consented to by Payee, and agree that suit may be
brought and maintained against any one or more of them, at the election of Payee
without joinder of any other as a party thereto, and that Payee shall not be
required first to foreclose, proceed against, or exhaust any security hereof in
order to enforce payment of this Note. The Maker and each Obligor hereby waives
presentment, demand for payment, notice of nonpayment, protest,
<PAGE>
notice of protest, notice of dishonor, and all other notices in connection
herewith, as well as filing of suit (if permitted by law), and diligence in
collecting this Note or enforcing any of the security hereof, and agrees to pay
(if permitted by law) all expenses incurred in collection, including Payee's
reasonable attorney's fees.
THE MAKER HEREBY UNCONDITIONALLY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM
OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF, DIRECTLY OR INDIRECTLY, THIS
NOTE, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS BETWEEN MAKER AND PAYEE
RELATING TO THE SUBJECT MATTER OF THIS TRANSACTION OR ANY RELATED TRANSACTIONS,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN MAKER AND PAYEE. THE
SCOPE OF THIS WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES
THAT MAY BE FILED IN ANY COURT (INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS,
TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY
CLAIMS.) THIS WAIVER IS IRREVOCABLE MEANING THAT IT MAY NOT BE MODIFIED EITHER
ORALLY OR IN WRITING, AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS NOTE, ANY RELATED DOCUMENTS, OR
TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THIS TRANSACTION OR ANY RELATED
TRANSACTION. IN THE EVENT OF LITIGATION, THIS NOTE MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.
This Note and any Security Agreement constitute the entire agreement of the
Maker and Payee with respect to the subject matter hereof and supercedes all
prior understandings, agreements and representations, express or implied.
No variation or modification of this Note, or any waiver of any of its
provisions or conditions, shall be valid unless in writing and signed by an
authorized representative of Maker and Payee. Any such waiver, consent,
modification or change shall be effective only in the specific instance and for
the specific purpose given.
Any provision in this Note or any Security Agreement which is in conflict with
any statute, law or applicable rule shall be deemed omitted, modified or altered
to conformed thereto.
MEADOW VALLEY CONTRACTORS, INC.
/s/ Julie L. Bergo By: /s/ Gary W. Burnell (L.S.)
- -------------------------------------- ---------------------------------
(Witness) (Signature)
Julie L. Bergo, Secretary GARY W. BURNELL, VP/CFO
- -------------------------------------- --------------------------------------
(Print name) Print name (and title, if applicable)
4411 S. 40th St. Ste D-11 Phoenix AZ 880171959
- -------------------------------------- --------------------------------------
(Address) 85040 (Federal tax identification number)
<PAGE>
EXHIBIT 10.61
PROMISSORY NOTE
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL LOAN DATE MATURITY LOAN NO CALL COLLATERAL ACCOUNT OFFICER INITIALS
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$168,750.00 12-23-1997 12-31-2004 5001 81 5140 5235200 80288
- ------------------------------------------------------------------------------------------------------------------------------
References in the shaded area are for Lender's use only and do not limit the applicability of this document to any
particular loan or item.
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C>
BORROWER: Meadow Valley Contractors, Inc. (TIN: 88-0171959) LENDER: NEVADA STATE BANK
4411 South 40th Street #D-11 CORPORATION BANKING
Phoenix, AZ 85040 201 SOUTH 4TH STREET
P.O. BOX 990
LAS VEGAS, NV 89125-0990
</TABLE>
================================================================================
PRINCIPAL AMOUNT: $168,750.00 INTEREST RATE: 9.000% DATE OF NOTE:
DECEMBER 23, 1997
PROMISE TO PAY. Meadow Valley Contractors, Inc. ("Borrower") promises to pay to
NEVADA STATE BANK ("Lender"), or order, in lawful money of the United States of
America, the principal amount of One Hundred Sixty Eight Thousand Seven Hundred
Fifty & 00/100 Dollars ($168,750.00), together with interest at the rate of
9.000% per annum on the unpaid principal balance from December 23, 1997, until
paid in full.
PAYMENT. Borrower will pay this loan in 84 payments of $2,731.11 each payment.
Borrower's first payment is due January 31, 1998, and all subsequent payments
are due on the same day of each month after that, Borrower's final payment will
be due on December 31, 2004, and will be for all principal and all accrued
interest not yet paid. Payments include principal and interest. Interest on this
Note is 365/360 simple interest basis; that is, by applying the ratio of the
annual interest rate over a year of 360 days, multiplied by the outstanding
principal balance, multiplied by the actual number of days the principal balance
is outstanding. Borrower will pay Lender at Lender's address shown above or at
such other place as Lender may designate in writing. Unless otherwise agreed or
required by applicable law, payments will be applied first to any unpaid
collection costs and any late charges, then to any unpaid interest, and any
remaining amount to principal.
PREPAYMENT. Borrower agrees that all loan fees and other prepaid finance charges
are earned fully as of the date of the loan and will not be subject to refund
upon early payment (whether voluntary or as a result of default), except as
otherwise required by law. Except for the foregoing, Borrower may pay without
penalty all or a portion of the amount owed earlier than it is due. Early
payments will not, unless agreed to by Lender in writing, relieve Borrower of
Borrower's obligation to continue to make payments under the payment schedule.
Rather, they will reduce the principal balance due and may result in Borrower
making fewer payments.
DEFAULT. Borrower will be in default if any of the following happens: (a)
Borrower fails to make any payment when due. (b) Borrower breaks any promise
Borrower has made to Lender, or Borrower fails to comply with or to perform when
due any other term, obligation, covenant, or condition contained in this Note or
any agreement related to this Note, or in any other agreement or loan Borrower
has with Lender. (c) Borrower defaults under any loan, extension of credit,
security agreement, purchase or sales agreement, or any other agreement, in
favor of any other creditor or person that may materially affect any of
Borrower's property or Borrower's ability to repay this Note or perform
Borrower's obligations under this Note or any of the Related Documents. (d) Any
representation or statement made or furnished to Lender by Borrower or on
Borrower's behalf is false or misleading in any material respect either now or
at the time made or furnished. (e) Borrower becomes insolvent, a receiver is
appointed for any part of Borrower's property, Borrower makes an assignment for
the benefit of creditors, or any proceeding is commenced either by Borrower or
against Borrower under any bankruptcy or insolvency laws. (f) Any creditor tries
to take any of Borrower's property on or in which Lender has a lien or security
interest. This includes a garnishment of any Borrower's accounts with Lender.
(g) Any guarantor dies or any of the other events described in this default
section occurs with respect to any guarantor of this Note. (h) A material
adverse change occurs in Borrower's financial condition, or Lender believes the
prospect of payment or performance of the Indebtedness is impaired. (i) Lender
in good faith deems itself insecure.
If any default, other than a default in payment, is curable and if Borrower has
not been given a notice of a breach of the same provision of this Note within
the preceding twelve (12) months, it may be cured (and no event of default will
have occurred) if Borrower, after receiving written notice from Lender demanding
cure of such default: (a) cures the default within ten (10) days; or (b) if the
cure requires more than ten (10) days, immediately initiates steps which Lender
deems in Lender's sole discretion to be sufficient to cure the default and
thereafter continues and completes all reasonable and necessary steps sufficient
to produce compliances as soon as reasonably practical.
LENDER'S RIGHTS. Upon default, Lender may declare the entire unpaid principal
balance on this Note and all accrued unpaid interest immediately due, without
notice, and then Borrower will pay that amount. Upon default, including failure
to pay upon final maturity, Lender, at its option, may also, if permitted under
applicable law, increase the interest rate on this Note 3,000 percentage points.
The interest rate will not exceed the maximum rate permitted by applicable law.
Lender may hire or pay someone else to help collect this Note if Borrower does
not pay. Borrower also will pay Lender that amount. This includes, subject to
any limits under applicable law, Lender's attorneys' fees and Lender's legal
expenses whether or not there is a lawsuit, including attorneys' fees and legal
expenses for bankruptcy proceedings (including efforts to modify or vacate any
automatic stay or injunction), appeals, and any anticipated post-judgment
collection service. If not prohibited by applicable law, Borrower also will pay
any court costs, in addition to all other sums provided by law. This Note has
been delivered to Lender and accepted by Lender in this State of Nevada. If
there is a lawsuit, Borrower agrees upon Lender's request to submit to the
jurisdiction of the courts of Clark County, the State of Nevada (Initial Here
[SIGNATURE ILLEGIBLE]). Lender and Borrower hereby waive the right to any jury
trial in any action, proceeding, or counterclaim brought by either Lender or
Borrower against the other. Subject to the provisions on arbitration, this Note
shall be governed by and construed in accordance with the laws of the State of
Nevada.
RIGHT OF SETOFF. Borrower grants to Lender a contractual possessory security
interest in, and hereby assigns, conveys, delivers, pledges, and transfers to
Lender all Borrower's right, title and interest in and to, Borrower's accounts
with Lender (whether checking, savings, or some other account), including
without limitation all accounts held jointly with someone else and all accounts
Borrower may open in he future, excluding however all IRA and Keogh accounts,
and all trust accounts for which the grant of a security interest would be
prohibited by law. Borrower authorizes Lender, to the extent permitted by
applicable law, to charge to setoff all sums owing on this Note against any and
all such accounts, and, at Lender's option, to administratively freeze all such
accounts to allow Lender to protect Lender's charge and setoff rights provided
on this paragraph.
COLLATERAL. This Note is secured by a Deed of trust of even date.
ARBITRATION. Lender, Borrower and/or Guarantor (where applicable) agree that:
(a) Any claim or controversy ("Dispute") between or among the parties, including
but not limited to Disputes arising out of relating to the Agreement, this
Addendum ("arbitration clause"), or any related agreements or instruments
relating hereto or delivered in connection herewith ("Related Documents"), and
including but not limited to a Dispute based on or arising from an alleged tort,
shall at the request of any party be resolved by binding arbitration in
accordance with the applicable arbitration rules of the American Arbitration
Association ("the Administrator"). The provisions of this arbitration clause
shall survive any termination, amendment, or expiration of this Agreement or
Related Documents.
1. ARBITRATION IS FINAL AND BINDING ON THE PARTIES AND SUBJECT TO ONLY VERY
LIMITED REVIEW BY A COURT.
2. IN ARBITRATION THE PARTIES ARE WAIVING THEIR RIGHT TO LITIGATE IN COURT,
INCLUDING THEIR RIGHT TO A JURY TRIAL.
3. DISCOVERY IN ARBITRATION IS MORE LIMITED THAN DISCOVERY IN COURT.
4. ARBITRATIONS ARE NOT REQUIRED TO INCLUDE FACTUAL FINDINGS OR LEGAL
REASONING IN THEIR AWARDS. THE RIGHT TO APPEAL OR SEEK MODIFICATION OF
ARBITRATORS' RULINGS IS VERY LIMITED
5. A PANEL OF ARBITRATIONS MIGHT INCLUDE AN ARBITRATOR WHO IS OR WAS
AFFILIATED WITH THE BANKING INDUSTRY.
6. IF YOU HAVE QUESTIONS ABOUT ARBITRATION, CONSULT YOUR ATTORNEY OR THE
AMERICAN ARBITRATION ASSOCIATION.
(b) The arbitration proceedings shall be conducted in Las Vegas, Nevada at a
place to be determined by the Administrator. The Administrator and the
arbitrator(s) shall have the authority to the extent practicable to take any
action to require the arbitration proceeding to be completed and the
arbitrator(s)' award issued within one-hundred-fifty (150) days of the filing of
the Dispute with the Administrator. The arbitrator(s) shall have the authority
to impose sanctions on any party that fails to comply with time periods imposed
by the Administrator or the arbitrator(s), including the sanction of summarily
dismissing any Dispute or defense with prejudice. The arbitrator(s) shall have
the authority to resolve any Dispute regarding the terms of this Agreement, this
arbitration clause or Related Documents, including any claim or controversy
regarding the arbitrability of any Dispute. All limitations periods applicable
to any Dispute or defense, whether by statue or agreement, shall apply to any
arbitration proceeding hereunder and the arbitrator(s) shall have the authority
to decide whether any Dispute or defense is barred by a limitations period and,
if so, to summarily dismiss any Dispute or defense on that basis. The doctrines
of complusory counterclaim, res judicata, and collateral estoppel shall apply to
any arbitration proceeding hereunder so that a party must state as a
counterclaim in the arbitration proceeding any claim or controversy which arises
out of the transaction or occurrence that is the subject matter of the Dispute.
The arbitrator(s) may in the arbitrator(s)' discretion and at the request of any
party: (1) consolidate in a single arbitration proceeding any other claim or
controversy involving another party that is substantially related to the Dispute
where that other party is bound by an arbitration clause with the Bank, such as
borrowers, guarantors, sureties, and owners of collateral; (2) consolidate in a
single arbitration proceeding any other claim or controversy that is
substantially similar to the Dispute; and (3) administer multiple arbitration
claims or controversies as class actions in accordance with the provisions of
Rule 23 of the Federal Rules of Civil Procedure.
(c) The arbitrator(s) shall be selected in accordance with the rules of the
Administrator from panels maintained by the Administrator. A single arbitrator
shall be knowledgeable in the subject matter of the Dispute. Where three
arbitrators conduct an arbitrator proceeding, the Dispute shall be decided by a
majority vote of the three arbitrators, at least one of whom must be
knowledgeable in the subject matter of the Dispute and at least one of whom must
be a practicing attorney. The arbitrator(s) shall award recovery of all costs
and fees (includings attorneys' fees and costs, arbitration administration fees
and costs, and arbitrator(s) fees). The arbitrator(s), either during the
pendency of the arbitration proceeding or as part of the arbitration award, also
may granted provisional or ancillary remedies including but not limited to
??????????? ?????????????????????
<PAGE>
12-23-1997 PROMISSORY NOTE
LOAN NO 5001 (CONTINUED)
================================================================================
appointment of a receiver.
(d) Judgment upon an arbitration award may be entered in any court having
jurisdiction, subject to the following limitation: the arbitration award is
binding upon the parties only if the amount does not exceed Two Million Dollars
($2,000,000.00); if the award exceeds that limit, either party may demand the
right to a court trial. Such a demand must be filed with the Administrator
within thirty (30) days following the date of the arbitration award; if such a
demand is not made within that time period, the amount of the arbitration award
shall be binding. The computation of the total amount of an arbitration award
shall include amounts awarded for attorneys' fees and costs, arbitration
administration fees and costs, and arbitration(s)' fees.
(e) No provision of this arbitration clause, nor the exercise of any rights
hereunder, shall limit the right of any party to: (1) judicially or non-
judicially foreclose against any real or personal property collateral or other
security; (2) exercise self-help remedies, including but not limited to
repossession and setoff rights; or (3) obtain from a court having jurisdiction
thereover any provisional or ancillary remedies including but not limited to
injunctive relief, foreclosure, sequestration, attachment, replevin,
garnishment, or the appointment of a receiver. Such rights can be exercised at
any time, before or during initiation of an arbitration proceeding, except to
the extent such action is contrary to the arbitration award. The exercise of
such rights shall not constitute a waiver of the right to submit any Dispute to
arbitration, and any claim or controversy related to the exercise of such rights
shall be a Dispute to be resolved under the provisions of the arbitration
clause.
(f) Notwithstanding the applicability of any other law to the Agreement, the
arbitration clause, or Related Documents between or among the parties, the
Federal Arbitration Act, 9 U.S.C. Section 1 et seq., shall apply to the
construction and interpretation of this arbitration clause.
GENERAL PROVISIONS. Lender may delay or forgo enforcing any of its rights or
remedies under this Note without losing them. Borrower and any other person who
signs, guarantees or endorses this Note, to the extent allowed by law, waive
presentment, demand for payment, protest and notice of dishonor. Upon any charge
in the terms of this Note, and unless otherwise expressly stated in writing, no
party who signs this Note, whether as maker, guarantor, accommodation maker or
endorser, shall be released from liability. All such parties agree that Lender
may renew or extend (repeatedly and for any length of time) this loan, or
release any party or guarantor or collateral; or impair, fail to realize upon or
perfect Lender's security interest in the collateral; and take any other action
deemed necessary by Lender without the consent of or notice to anyone. All such
parties also agree that Lender may modify this loan without the consent of or
notice to anyone other than the party with whom the modification is made.
PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF
THIS NOTE. BORROWER AGREES TO THE TERMS OF THE NOTE AND ACKNOWLEDGES RECEIPT OF
A COMPLETED COPY OF THE NOTE.
BORROWER:
Meadow Valley Contractors, Inc.
By: /s/ Gary W. Burnell
-----------------------------------
Gary W. Burnell, Vice President
================================================================================
<PAGE>
EXHIBIT 10.62
KDC FINANCIAL
--------------------
ACCOUNT NO. ___________
--------------------
SECURITY AGREEMENT - CONDITIONAL SALES CONTRACT
Subject to the Terms and Conditions herein contained, the Seller hereby agrees
to sell, and the Buyer having been quoted and offered both a cash sale price,
payable immediately or within a limited number of days, and a contract time
price which permits the Buyer to purchase the property now but pay in
installments over an extended period of time, hereby agrees to buy, the
following described property ("property") on a contract time price basis set
forth below. The contract time price is more than the cash sales price because
it includes charges by the Seller to compensate the Seller for having to wait a
period of time before collecting its full purchase price and for taking a risk
in waiting such period of time. The property is to be used only for commercial
or business purposes, includes all accessories and attachments, and shall,
except as permitted by Paragraph 7 on pages 4 and 5 hereof, be located at
Buyer's Address set forth immediately below.
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------
SELLER NAME & LOCATION BUYER NAME & ADDRESS/LOCATION
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C>
NAME: LEGAL NAME:
KOMATSU EQUIPMENT COMPANY MEADOW VALLEY CONTRACTORS, INC
---------------------------------------------------------------------------
MAILING ADDRESS: CITY:
- ---------------------------------------------
ADDRESS: P.O. BOX 60726 PHOENIX
---------------------------------------------------------------------------
2350 WEST 1500 SOUTH COUNTY: STATE: ZIP: TELEPHONE:
MARICOPA AZ 85082-0726 (602) 437-5400
- -----------------------------------------------------------------------------------------------------------------------------
CITY: PHYSICAL LOCATION: CITY:
SALT LAKE CITY P.O. BOX 60726 PHOENIX
- -----------------------------------------------------------------------------------------------------------------------------
STATE: ZIP: COUNTY: STATE: ZIP: FED. I.D. / SSN:
UT 84104 MARICOPA AZ 85082-0726 88-0171959
- -----------------------------------------------------------------------------------------------------------------------------
PROPERTY DESCRIPTION
- -----------------------------------------------------------------------------------------------------------------------------
QUANTITY NEW / USED MAKE MODEL DESCRIPTION SERIAL NUM PRICE
- -----------------------------------------------------------------------------------------------------------------------------
1 New Komatsu PC220LC-6 HYDRAULIC EXCAVATOR A82079 $205,250.00
</TABLE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
TRADE-IN EQUIPMENT DESCRIPTION 1. SALES PRICE: $205,250.00
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
2. DELIVERY, INSTALLATION,
REPAIR OR OTHER SERVICE
CHARGES IF ANY: $0.00
------------------------------------------------------
3. SALES TAX: $ 7,269.50
------------------------------------------------------
4. CASH PRICE
(INVOICE, TAX, SERVICE CHARGES): $212,519.50
------------------------------------------------------
5A. CASH $78,000.00
------------------------------------------------------
B. NET TRADE-IN
ALLOWANCE: $ 0.00
- -------------------------------------------------------------------- ------------------------------------------------------
SCHEDULE OF PAYMENTS C. LESS INSURANCE
PREMIUM: $ 0.00
- -------------------------------------------------------------------- ------------------------------------------------------
BUYER AGREES TO PAY SELLER, OR IF THIS CONTRACT IS ASSIGNED TO ASSIGNEE
OF SELLER, THE "TOTAL OF PAYMENTS" (ITEM 10) IN ACCORDANCE WITH THE
FOLLOWING SCHEDULE PAYMENTS IN NUMBER AND AMOUNT ARE DUE EACH SUCCESSIVE
MONTH ON THE SAME DAY AS THE STARTING DATE
- -----------------------------------------------------------------------------------------------------------------------------
NUMBER OF STARTING DATE ENDING DATE AMOUNT OF EACH TOTAL TOTAL DOWN PAYMENT
PAYMENTS PAYMENTS (5A + 5B - 5C) $ 78,000.00
- -----------------------------------------------------------------------------------------------------------------------------
36 02-01-1998 01-01-2001 $ 4,130.55 $148,699.80 6. UNPAID BALANCE OF CASH PRICE
- ----------------------------------------------------------------------
(4 LESS 5) $134,519.50
------------------------------------------------------
7A. CERT. OF TITLE & $ 0.00
LIEN FILING FEE:
------------------------------------------------------
B. OTHER FEES: $250.00
------------------------------------------------------
TOTAL OTHER CHARGES $ 250.000
------------------------------------------------------
8. UNPAID BALANCE (AMOUNT
FINANCED): (TOTAL OF 6 & 7) $134,769.50
------------------------------------------------------
9. FINANCE CHARGE $ 13,930.30
- -----------------------------------------------------------------------------------------------------------------------------
36 TOTAL NUMBER OF PAYMENTS TOTAL OF PAYMENTS(10) $148,699.80 10. TOTAL OF PAYMENTS
(TOTAL OF 8 & 9) $148,699.80
- -----------------------------------------------------------------------------------------------------------------------------
DATE FINANCE BEGINS TO ACCRUE 11. TOTAL TIME PRICE:
(IF DIFFERENT THAN CONTRACT DATE): (TOTAL OF 4, 7 & 9) $226,699.80
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
EXHIBIT 10.63
MASTER LEASE AGREEMENT
MASTER LEASE AGREEMENT ("Master Lease") dated as of 5/6/97 between The CIT
Group/Equipment Financing Inc. (Lessor).
having a place of business at P.O. Box 27248 Temoe AZ 85285-7248
--------------------------------------------------
Address City State Zip Code
and Meadow Valley Contractors, Inc. ("Lessee")
------------------------------------------------------------------
having a place of business at 4411 South 40th Street Phoenix AZ 85040
--------------------------------------------------
Address City State Zip Code
This Master Lease Agreement provides a set of terms and conditions that the
parties hereto intend to be applicable to various transactions for the lease of
personal property. Each lease contract shall be evidenced by an equipment
schedule ("Schedule") executed by Lessor and Lessee that explicitly incorporates
the provisions of this Master Lease Agreement and that sets forth specific terms
of that particular lease contract. Where the provisions of a Schedule conflict
with the terms hereof, the provisions of the Schedule shall prevail. Each
Schedule shall constitute a complete and separate lease agreement, independent
of all other Schedules and without any requirement of being accompanied by an
originally executed copy of this Master Lease Agreement. The term "Lease when
used herein shall refer to an individual Schedule.
One originally executed copy of the Schedule shall be denominated "Originally
Executed Copy No. 1 of 1 originally executed copies and such copy shall be
retained by Lessor. If more than one copy of the Schedule is executed by Lessor
and Lessee, all such other copies shall be numbered consecutively with numbers
greater than 1. Only transfer of possession by Lessor of the originally executed
copy denominated "Originally Executed Copy No. 1" shall be effective for
purposes of perfecting an interest in such Schedule by possession.
1. EQUIPMENT LEASED AND TERM.
This Lease shall cover such personal property as is described in any Schedule
executed by or pursuant to the authority of Lessee accepted by Lessor in writing
and identified as a part of this Lease (which personal property with all
replacement parts, additional repairs, accessions and accessories incorporated
therein and/or affixed thereto is hereinafter called the "Equipment"). Lessor
here??? leases to Lessee and Lessee hereby hires and takes from Lessor, upon and
subject to the covenants and conditions hereinafter contained, the Equipment
described in any Schedule. Notwithstanding the commencement date of the term of
this Lease with respect to any item of Equipment, Lessee agrees that all risk of
loss of the Equipment shall be on Lessee from and after shipment of the
Equipment to Lessee by the seller thereof, F.O.B. seller's point of shipment,
the date of such shipment be????? hereinafter called "date of shipment." The
term of this Lease with respect to any item of Equipment shall be for the period
as set forth in the Schedule. Lessee hereby gives Lessor authority to insert the
actual commencement date and date of first monthly rental for an item of
Equipment in any Schedule as well as such items as serial numbers if such are
not already inserted when such Schedule executed by Lessee. "Seller" as used in
this Lease means the supplier from which Lessor acquires any item of Equipment.
2. RENT.
The aggregate rent payable with respect to each item of Equipment shall be in
the amount shown with respect to such item on Schedule. Lessee shall pay to
Lessor the aggregate rental for each item of Equipment for the full period and
term for which Equipment is leased, such rental to be payable at such times and
in such amounts for each item of Equipment as shown in applicable Schedule.
All rent shall be paid at Lessor's place of business shown above, or such other
place as Lessor may designate by written notice to Lessee. All rents shall be
paid without notice or demand and without abatement, deduction or set off of any
amount whatsoever. The operation and use of the Equipment shall be at the risk
of Lessee and not of Lessor and the obligation of Lessee pay rent hereunder
shall be unconditional.
<PAGE>
19. SPECIAL PROVISIONS.
If Lessee is a corporation, this Lease is executed by authority of its Board or
Directors. If Lessee is a partnership or joint venture, this Lease is executed
by authority of all its partners or co-venturers.
Dated: 5/6/97
-------------
LESSEE:
Meadow Valley Contractors, Inc.
- ---------------------------------------------------------------
Name of individual, corporation or partnership
By /s/ Kenneth D. Nelson Title VICE PRESIDENT
---------------------------- ---------------------------
If corporation, have signed by President, Vice President or Treasurer, and
give official title.
If owner or partner, state which.
LESSOR:
THE CIT GROUP/EQUIPMENT FINANCING, INC.
By [SIGNATURE ILLEGIBLE] Title SCOM
---------------------------- ---------------------------
________________________________________________________________________________
If Lessee is a partnership, enter:
Partners' names Home addresses
- --------------- --------------
<PAGE>
THE CIT GROUP/EQUIPMENT FINANCING, INC.
P.O. Box 27248
- --------------------------------------------------------
Address
Tempe AZ 85285-7248
- --------------------------------------------------------
City State Zip Code
Gentlemen:
You are irrevocably instructed to disburse the proceeds of the Schedule of
Leased Equipment No. 1 dated 5-6-97, to Master Lease Agreement dated 5-6-97,
between Meadow Valley Contractors, Inc., as Lessee and the CIT Group/Equipment
--------------------------------
Financing., as Lessor, as follows:
Payee Names and Addresses Amount
- ------------------------------------------------- -----------------
Meadow Valley Contractors, Inc. $ 170,000.00
----------------
The CIT Group/Equipment Financing, Inc. $ 250.00
----------------
(Non refundable origination fees) $________________
$________________
$________________
$________________
$________________
Total Proceeds
$ 170,250.00
----------------
Very truly yours,
Meadow Valley Contractors, Inc.
- --------------------------------------------------------
By /s/ Kenneth D. Nelson Title VICE PRESIDENT
- -------------------------------- ------------------
Page 1 of 1
<PAGE>
EXHIBIT 10.64
MASTER LEASE AGREEMENT
MASTER LEASE AGREEMENT ("Master Lease") dated as of 5/6/97 between The CIT
Group/Equipment Financing Inc. Lessor),
having a place of business at P.O Box 27248 Tempe AZ 85285-7248
-------------------------------------------------
Address City State Zip Code
and Meadow Valley Contractors, Inc. ("Lessee")
------------------------------------------------------------------
having a place of business at 4411 South 40th Street Phoenix AZ 85040
--------------------------------------------------
Address City State Zip code
This Master Lease Agreement provides a set of terms and conditions that the
parties hereto intend to be applicable to various transactions for the lease of
personal property. Each lease contract shall be evidenced by an equipment
schedule ("Schedule)" executed by Lessor and Lessee that explicitly incorporates
the provisions of this Master Lease Agreement and that sets forth specific terms
of that particular lease contract. Where the provisions of a Schedule conflict
with the terms hereof, the provisions of the Schedule shall prevail. Each
Schedule shall constitute a complete and separate lease agreement, independent
of all other Schedules and without any requirement of being accompanied by an
originally executed copy of this Master Lease Agreement. The term "Lease when
used herein shall refer to an individual Schedule.
One originally executed copy of this Schedule shall be denominated "Originally
Executed Copy No. 1 of 1 originally executed copies and such copy shall be
retained by Lessor. If more than one copy of the Schedule is executed by Lessor
and Lessee, all such other copies shall be numbered consecutively with numbers
greater than 1. Only transfer of possession by Lessor of the originally executed
copy denominated "Originally Executed Copy No. 1" shall be effective for
purposes of perfecting an interest in such Schedule by possession.
1. EQUIPMENT LEASED AND TERM.
This Lease shall cover such personal property as is described in any Schedule
executed by or pursuant to the authority of Lessee accepted by Lessor in writing
and identified as a part of this Lease (which personal property with all
replacement parts, additional repairs, accessions and accessories incorporated
therein and/or affixed thereto is hereinafter called the "Equipment"). Lessor
here leases to Lessee and Lessee hereby hires and takes from Lessor, upon and
subject to the covenants and conditions hereinafter contained, the Equipment
described in any Schedule. Notwithstanding the commencement date of the term of
this Lease with respect to any item of Equipment, Lessee agrees that all risk
of loss of the Equipment shall be on Lessee from and after shipment of the
Equipment to Lessee by the seller thereof, F.O.B. seller's point of shipment,
the date of such shipment be hereinafter called "date of shipment." The term of
this Lease with respect to any item of Equipment shall be for the period as set
forth in the Schedule. Lessee hereby gives Lessor authority to insert the actual
commencement date and date of first monthly rental for an item of Equipment in
any Schedule as well as such items as serial numbers if such are not already
inserted when such Schedule executed by Lessee. "Seller" as used in this Lease
means the supplier from which Lessor acquired any item of Equipment.
2. RENT
The aggregate rent payable with respect to each item of Equipment shall be in
the amount shown with respect to such item on Schedule. Lessee shall pay to
Lessor the aggregate rental for each item of Equipment for the full period and
term for which Equipment is leased, such rental to be payable at such times and
in such amounts for each item of Equipment as shown in applicable Schedule.
All rent shall be paid at Lessor's place of business shown above, or such other
place as Lessor may designate by written notice to Lessee. All rents shall be
paid without notice or demand and without abatement, deduction or set off of any
amount whatsoever. The operation and use of the Equipment shall be at the risk
of Lessee and not of Lessor and the obligation of Lessee pay rent hereunder
shall be unconditional.
<PAGE>
19. SPECIAL PROVISIONS
If Lessee is a corporation, this Lease is executed by authority of its Board of
Directors. If Lessee is a partnership or joint venture, this Lease is executed
by authority of all its partners or co-ventures.
Dated: 5/6/97
---------------------
LESSEE:
Meadow Valley Contractors, Inc.
- ------------------------------------------------------------
Name of individual, corporation or partnership
By /s/ Kenneth D. Nelson Title Vice President
-------------------------------- ---------------------
If corporation, have signed by President, Vice President
or Treasurer, and give official title, if owner or partner,
state which.
LESSOR:
THE CIT GROUP/EQUIPMENT FINANCING, INC.
By [SIGNATURE ILLEGIBLE] Title Scom
-------------------------------- ---------------------
________________________________________________________________________________
If Lessee is a partnership, enter:
Partners' names Home addresses
- --------------- --------------
Page 7 of ???
<PAGE>
________________________
Date
THE CIT GROUP/EQUIPMENT FINANCING, INC.
P. O. BOX 27248
- -------------------------------------------------------
Address
Tempe AZ 85285-7248
- -------------------------------------------------------
City State Zip Code
Gentlemen:
You are irrevocably instructed to disburse the proceeds of the Schedule of
Leased Equipment No. 2 dated __________________________, to Master Lease
Agreement dated May 6, 1997, between Meadow Valley Contracting, Inc., as Lessee
and the CIT Group/Equipment Financing., as Lessor, as follows:
<TABLE>
<CAPTION>
Payee Names and Addresses Amount
- ----------------------------------------------- --------------------
<S> <C>
Meadow Valley Contractors, Inc. $ 158,140,00
------------------
$ __________________
The CIT Group/Equipment Financing, Inc. (Non Refundable Processing Fees) $ 350,00
------------------
$ __________________
$ __________________
$ __________________
$ __________________
Total Proceeds $ 158,490.00
------------------
</TABLE>
Very truly yours,
Meadow Valley Contractors, Inc.
- ------------------------------------------------------
By Gary W. Burnell Title VP/CFO
----------------------------- ------------------
Page 1 of 1
<PAGE>
EXHIBIT 10.65
CONTRACT
THIS AGREEMENT made and executed in Three (3) original counterparts this
2nd day of July A.D. 1997 between the Utah Department of Transportation,
hereinafter called "Department," first party, and Meadow Valley Contractors,
Inc. hereinafter called "Contractor," second party.
WITNESSETH, That for and in consideration of payments, hereinafter
mentioned, to be made by the Department, the Contractor agrees to furnish all
labor and equipment; to furnish and deliver all materials not specially
mentioned as being furnished by the Department and to do and perform all work in
the CONSTRUCTION OF ROADWAY IN SALT LAKE COUNTY, State of Utah, the same being
identified as SP-0154(9)1 for the approximate sum of SEVENTEEN MILLION EIGHT
HUNDRED SIXTY-TWO THOUSAND ONE HUNDRED FORTY-SIX and 00/100 Dollars
($17,862,146.00).
The Contractor further covenants and agrees that all of said work and labor
shall be done and performed in the best and most workmanlike manner and in
strict conformity with the plans, and specifications. The said plans and
specifications and the notice to contractors, instruction to bidders, the
proposal, special provisions and contract bond are hereby made a part of this
agreement as fully and to the same effect as if the same had been set forth at
length herein.
In consideration of the foregoing premises, the Department agrees to pay to
Contractor in the manner and in the amount provided in the said specification
and proposal.
IN WITNESS WHEREOF, the parties hereto have subscribed their names through
their proper officers thereunto duly authorized as of the day and year first
above written.
Attest: UTAH DEPARTMENT OF TRANSPORTATION
[SIGNATURE ILLEGIBLE] [SIGNATURE ILLEGIBLE]
- -------------------------------- ----------------------------------------
Secretary Director of Transportation - First Party
Witnesses:
/s/ Lisa Forsling Meadow Valley Contractors, Inc.
- -------------------------------- -----------------------------------------
Second Party
[SIGNATURE ILLEGIBLE]
- --------------------------------
Approved as to form: by [SIGNATURE ILLEGIBLE]
-----------------------------------
By [SIGNATURE ILLEGIBLE] UTAH AREA MANAGER.
------------------------------ -----------------------------------
Assistant Attorney General Title
#83-243374-5501
APPROVED________________________ -------------------------------------
Director of Finance Utah Contractor License Number
FUNDS AVAILABLE______________________
[SIGNATURE ILLEGIBLE] 7-7-97
---------------------- -------------
Budget Officer Date
<PAGE>
EXHIBIT 10.66
CONTRACT
--------
THIS CONTRACT, made and entered into this 3rd day of June, 1997, between
Clark County, a political subdivision of the State of Nevada, hereinafter
referred to as the "OWNER" and Meadow Valley Contractors, Inc., (a Corporation
organized and existing under the laws of the State of Nevada), hereinafter
referred to as the "CONTRACTOR".
WITNESSETH: That said CONTRACTOR having been awarded the Contract
for the construction of the MOBILE HOME PARK SITE DEVELOPMENT AND
COMMON FACILITIES in Las Vegas, Nevada.
in accordance with the Bid therefore and for and in consideration of the
promises and of the covenants and agreements, and of the payments herein
specified, to be made and performed by the CONTRACTOR and the OWNER, the
CONTRACTOR hereby covenants and agrees to and with the OWNER to undertake and
execute all of the said named Work, in a good, substantial and workmanlike
manner, and to furnish all the materials and all the tools and labor necessary
to properly perform and complete the Work ready for use, in strict accordance
with all the provisions of the Contract including the following Exhibits
attached hereto and made a part hereof:
Invitation to Bid
Bid
Contract
Exhibit "B"-Special Conditions
Exhibit "A"-General Conditions
Exhibit "C"-Compensation Conditions
Exhibit "D"-Addenda
Exhibit "E"-Technical Specifications
Exhibit "F"-List of Drawings
Contract Drawings
Contract No.2062
Conformed Document Contract
June 03, 1997 Page 1 of 11
<PAGE>
and accept as full compensation for the satisfactory performance of this
Contract the sum of Seven Million Four Hundred Seventy Two Thousand One Hundred
Twenty Nine Dollars and Eighteen Cents ($7,472,129.18).
The prices named in the Bid are for the completed Work, and include the
furnishing of all materials and all labor, tools, and appliances and all
expense, direct or indirect, connected with the proper execution of the Work and
of maintaining the same until it is accepted by the OWNER. In the event that
unit prices are included in the base bid amount, the sum stated above is an
estimated total Contract amount. Full compensation will be based upon the amount
or number of each unit of work approved by the OWNER as satisfactorily completed
in accordance with the Contract, multiplied by the applicable unit price set
forth in the Bid.
The CONTRACTOR shall commence the Work to be performed under this Contract
on the date set by the OWNER in the written Notice to Proceed, continuing the
Work with diligence and shall complete the entire Work in accordance with
ATTACHMENT NO. TWO TO BID, MILESTONE AND LIQUIDATED DAMAGES DATA. Further, in
the event interim milestone completion dates are established in the above
ATTACHMENT NO. TWO TO BID for separable portions of the Work, the CONTRACTOR
agrees to complete said separable portions of the Work in accordance with said
milestone dates.
CONTRACTOR acknowledges that the time for completion of the Work is
sufficient for it to perform all the Work. In case of failure on the part of the
CONTRACTOR, to complete the Work within the time(s) specified in the Contract,
or within such additional time(s) as may be granted by formal action of the
Board of County Commissioners or fails to prosecute the Work, or any separable
part thereof, with such diligence as will insure its completion within the
time(s) specified in the Contract or any extensions thereof, the CONTRACTOR
shall pay to the OWNER, as liquidated damages, the sum(s) indicated in
ATTACHMENT NO. TWO TO BID if so established therein for milestone completion
dates of separable parts of the Work and final completion of the Work.
Contract No. 2062
Conformed Document Contract
June 03, 1997 Page 2 of 11
<PAGE>
The Award of this Contract is subject to the condition precedent that the
CONTRACTOR provide a Performance Bond and a Labor and Material Payment Bond as
required by the Contract Documents.
IN WITNESS WHEREOF, the Board of County Commissioners of Clark County,
Nevada, has authorized it's Director of Aviation to execute this Contract on
behalf of the said OWNER, and the CONTRACTOR has hereunto set his hand and seal
the day and year above written.
CLARK COUNTY, NEVADA
By: /s/ Randall H. Walker
--------------------------------
RANDALL H. WALKER
Director of Aviation
NOTE: Witnesses not required for corporation,
but Corporate Certificate must be complete.
Two witnesses required for Partnerships and
Individuals. Partnerships must complete
Partnership Certificate.
________________________________ MEADOW VALLEY CONTRACTORS, INC.
Witness
BY: /s/ Alan Terril
________________________________ --------------------------------
Witness ALAN TERRIL
Vice President
[SEAL]
Contract No. 2062
Conformed Document Contract
June 03, 1997 Page 3 of 11
<PAGE>
EXHIBIT 10.67
Form No. A-555 CONTRACT NO. E03383
Rev. 9-87
New Mexico State Highway and Transportation Department
CONTRACT
THIS CONTRACT, made this 26th day of NOVEMBER 1997, between the NEW
MEXICO STATE HIGHWAY AND TRANSPORTATION DEPARTMENT AND
MEADOW VALLEY CONTRACTORS, INC.
- --------------------------------------------------------------------------------
(State whether individual, partnership, corporation or joint venture, if
incorporated, give State of incorporation)
of PHOENIX, ARIZONA
------------------------------------------------------------------------------
his or its successors and assign, hereinafter call the Contractor.
In consideration of the payment or payments herein specified and agreed to by
the State, the contractor agrees to furnish and deliver all the labor, materials
and equipment, necessary to do and perform all the work required in the
construction of Project No. TPA-0048(12) Control No. 1738 located in Lincoln
County, State of New Mexico at the unit prices bid by the contractor in his
original proposal, which proposal and prices stated, together with the plans,
specifications, supplemental specifications and acknowledged addenda of the
State Highway and Transportation Department are made a part of this contract and
are incorporated herein by reference.
The performance and payment bond given by the contractor in the sum of
$8,399,970.00 to secure the proper compliance with the terms, conditions and
provisions of this contract is attached hereto and made a part of this contract.
The Contractor certifies that he has obtained and will maintain in
force all insurance in the designated amount as set forth in the specifications
in a form and amount satisfactory to the New Mexico State Highway and
Transportation Department.
MEADOW VALLEY CONTRACTORS, INC.
CONTRACTOR
BY /s/ Bradley E. Larson NEW MEXICO STATE HIGHWAY & TRANSPORTATION DEPT.
--------------------- _______________________________________________
BRADLEY E. LARSON
TITLE PRESIDENT BY [SIGNATURE ILLEGIBLE]
------------------- ---------------------------------------------
SECRETARY OF STATE HIGHWAY & TRANSPORTATION
DEPT.
CORPORATE ACKNOWLEDGMENT
STATE OF ARIZONA )
COUNTY OF MARICOPA ) SS.
The foregoing instrument was acknowledgment before me this 20th day of
----
November, 1997 by JULIE L. BERGO Secretary
- -------- -- ------------------- -------------------
(Name of Officer) (Title of Officer)
of Meadow Valley Contractors, Inc.
------------------------------------------------
(Name of Corporation)
an NEVADA corporation,
----------------------------------------------------------------
(State whether individual, partnership, corporation or joint venture, if
incorporated, give State of incorporation)
on behalf of said corporation.
My Commission expires: Arminda Palacio
----------------------
______________________________ NOTARY PUBLIC
[SEAL]
<PAGE>
EXHIBIT 10.68
AGREEMENT
THIS AGREEMENT is made and entered into as of the _____________ day of JULY
21, 1997 by and between SALT LAKE CITY CORPORATION, a municipal corporation of
the State of Utah, (hereinafter "City") and Meadow Valley Contractors, Inc.,
hereinafter "Contractor", whose address is 1598 North Hillfield Road Suite C
Layton, Utah 84041;
WITNESSETH:
The Contractor and the City, for the consideration hereinafter named, agree
as follows:
1. SCOPE OF WORK.
A. Contractor agrees to furnish all labor, materials and equipment
necessary to perform all of the Work required in the Contract
Documents for the Project titled Taxiway G Extension - North End, No.
54 1077 0276.
2. TIME OF COMPLETION.
A. The Work under this Agreement shall commence following issuance of the
Notice to Proceed and shall be completed within the time allowed
indicated on Page B-3 of the Contractor's Bid.
3. CONSIDERATION.
A. The City shall pay the Contractor for the performance of all
obligations set forth herein the sum of Eight Million Nine Hundred
Ninety-Nine Thousand Five Hundred Three Dollars. ($8,999,503.00);
subject to the provisions of paragraph 3C below and Article 9 of this
Agreement.
A-1
<PAGE>
B. The Schedules of Prices hereunder are pursuant to Contractor's Bid
dated June 11, 1997.
C. The City agrees to pay and the Contractor agrees to accept for full
performance of this Agreement, the lump sum agreed upon, or a sum
which is based upon the actual quantities used or constructed in
accordance with the Contract Documents or a combination thereof. All
measurements will be performed by the City's Engineer or his
authorized representative. The sum also includes the cost of all
bonds, insurance, permits and fees required herein and all charges,
expenses or assessments of whatever kind or character. Claims for
services allegedly furnished by Contractor but not specifically
provided for herein shall not be honored by the City.
4. LIQUIDATED DAMAGES.
A. Time is the essence of this Agreement. In view of the difficulty of
determining the City's damages caused by late completion the parties
hereby agree, fix and determine that the Contractor shall be
responsible to pay the City liquidated compensatory damages in such
amounts and upon such terms as are specified below.
B. Contractor agrees that the payment of liquidated damages shall
commence on the calendar day after the date fixed for completion
including any extensions of additional time which may have been
allowed in writing. From and after said date, the City shall be
entitled to deduct and retain said liquidated damages out of any
monies which may be due or become due to the Contractor, and the City
may require the Contractor to pay the City liquidated damages for each
calendar day after said date until the City accepts the project as
substantially complete.
C. Liquidated damages shall be in the amount specified on page B-3 of the
Contractor's bid.
D. After the City has accepted substantial completion, liquidated damages
shall not accrue while the City makes
A-2
<PAGE>
damages from such a disturbance. The parties agree that Contractor will pay
as liquidated damages for each such disturbance the sum of $1,000 to cover
such damage and expense, which sum may be deducted from the Contractor's
compensation.
28. CONTROLLING LAW.
A. The interpretation of this Agreement shall be governed by the laws of
the State of Utah. Any court action arising from this Agreement shall
be brought in a federal or state court with appropriate jurisdiction
in the City of Salt Lake, State of Utah.
29. ASSIGNMENT.
A. This Agreement or any benefit, obligation or part thereof cannot
be assigned by either party without the prior written consent of the
other.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
SALT LAKE CITY CORPORATION
By /s/ Russell Widmar
-------------------------------------
EXECUTIVE DIRECTOR -
SALT LAKE CITY AIRPORT AUTHORITY
ATTEST:
/s/ Christine Meeker
- --------------------------
CHIEF DEPUTY CITY RECORDER
/s/ Kenneth D. Nelson (Seal)
[ SEAL ] --------------------------------
VICE PRESIDENT
MEADOW VALLEY CONTRACTORS, INC. (Seal)
--------------------------------
CONTRACTOR
________________________________ (Seal)
A-14
<PAGE>
CITY ACKNOWLEDGMENT
-------------------
STATE OF UTAH )
:
COUNTY OF SALT LAKE )
On the 21 day of July, 1997, personally appeared before me RUSSELL
C. WIDMAR and CHRISTINE MEEKER, who being by me duly sworn, did say that they
are the EXECUTIVE DIRECTOR - SALT LAKE CITY AIRPORT AUTHORITY and CHIEF DEPUTY
CITY RECORDER, respectively, of SALT LAKE CITY CORPORATION, and said persons
acknowledged to me that said corporation executed the same.
/s/ Scott C. Crandall
---------------------------------------
NOTARY PUBLIC, residing in
SALT LAKE COUNTY
-----------------
My Commission Expires: [SEAL]
_________________________
CORPORATION ACKNOWLEDGMENT
--------------------------
STATE OF UTAH )
:
COUNTY OF SALT LAKE)
On the 30 day of June, 1997, personally appeared before me KENNETH D.
NELSON, who being by me duly sworn did say that he is the VICE PRESIDENT of
MEADOW VALLEY CONTRACTORS, INC., a corporation, and that the foregoing
instrument was signed in behalf of said corporation by authority of a resolution
(or bylaws) of its Board of Directors; and said persons acknowledged to me that
said corporation executed the same.
/s/ Lisa Forsling Layton, Utah
-------------------------- ---------------------------------
LISA FORSLING NOTARY PUBLIC, residing in
___________________
My Commission Expires:
July 24, 2000 [SEAL]
- -------------------------
A-15
<PAGE>
EXHIBIT 10.69
CONTRACT
THIS AGREEMENT made and executed in THREE (3) original counterparts this
2nd day of July A.D. 1997 between the Utah Department of Transportation,
hereinafter called "Department," first party, and MEADOW VALLEY CONTRACTORS,
INC. hereinafter called "Contractor," second party.
WITNESSETH, That for and in consideration of payments, hereinafter
mentioned, to be made by the Department, the Contractor agrees to furnish all
labor and equipment; to furnish and deliver all materials not specifically
mentioned as being furnished by the Department and to do and perform all work in
the CONSTRUCTION OF ROADWAY IN SALT LAKE COUNTY, State of Utah, the same being
identified as SP-0154(9)1 for the approximate sum of SEVENTEEN MILLION EIGHT
HUNDRED SIXTY-TWO THOUSAND ONE HUNDRED FORTY-SIX AND 00/100 Dollars
($17,862,146.00).
The Contractor further covenants and agrees that all of said work and labor
shall be done and performed in the best and most workmanlike manner and in
strict conformity with the plans, and specifications. The said plans and
specifications and the notice to contractors, instruction to bidders, the
proposal, special provisions and contract bond are hereby made a part of this
agreement as fully and to the same effect as if the same had been set forth at
length herein.
In consideration of the foregoing premises, the Department agrees to pay to
Contractor in the manner and in the amount provided in the said specification
and proposal.
IN WITNESS WHEREOF, the parties hereto have subscribed their names through
their proper officers thereunto duly authorized as of the day and year first
above written.
Attest: UTAH DEPARTMENT OF TRANSPORTATION
[SIGNATURE ILLEGIBLE] [SIGNATURE ILLEGIBLE]
- -------------------------------- ----------------------------------------
Secretary Director of Transportation - First Party
Witnesses:
[SIGNATURE ILLEGIBLE] Meadow Valley Contractors, Inc.
- -------------------------------- -----------------------------------------
Second Party
[SIGNATURE ILLEGIBLE]
- --------------------------------
Approved as to form: by [SIGNATURE ILLEGIBLE]
-----------------------------------
By [SIGNATURE ILLEGIBLE] UTAH AREA MANAGER.
------------------------------ -----------------------------------
Assistant Attorney General Title
#83-243374-5501
APPROVED________________________ -------------------------------------
Director of Finance Utah Contractor License Number
FUNDS AVAILABLE______________________
[SIGNATURE ILLEGIBLE] 7-7-97
---------------------- -------------
Budget Officer Date
<PAGE>
EXHIBIT 10.70
CONTRACT AGREEMENT
THIS AGREEMENT, made and entered into this 24th day of June, 1997, by and
between the STATE OF ARIZONA, acting by and through its State Engineer duly
authorized by the Director, Arizona
Department of Transportation to enter into such agreement, party of the first
part, and MEADOW VALLEY CONTRACTORS, INC. hereinafter called the Contractor,
party of the second part.
WITNESSETH: That the said Contractor, for in consideration of the sum to be paid
him by said State Arizona in the manner and at the time hereinafter provided,
and of the other covenants and agreements herein contained, hereby agrees, for
himself, heirs, administrators, successors and assigns as follows:
ARTICLE I - SCOPE OF WORK: The Contractor shall perform in a workmanlike
and substantial manner and to the satisfaction of the State Engineer, all the
work specified under TRACS/Project No.
101L MA 041 H406001C RAM-600-1-542
PIMA FREEWAY (101L)
(Shea Boulevard - McDonald Drive)
and furnish at his own cost and expense all necessary machinery, tools,
apparatus, materials and labor to complete the work in the most substantial and
workmanlike manner according to the Plans and Specifications therefor on file
with the State Engineer and such modifications of the same and other directions
that may be made by the State Engineer as provided herein.
ARTICLE II - CONTRACT DOCUMENTS: It is further agreed that the Proposal,
Plans, Standard Specifications, Special Provisions, Contract Bond(s) and any and
all Supplementary Agreements, and any and all requirements necessary to complete
the work in a substantial and acceptable manner, and any and all equipment and
progress statements required, are hereby referred to and made a part of this
contract, and shall have the same force and effect as though all of the same
were fully inserted herein.
ARTICLE III - WARRANTY: The Contractor expressly warrants that he is free
from obligation of any other person or persons for services rendered, or
supposed to have rendered, in the procurement of this contract. He further
agrees that any breach of the Warranty shall constitute adequate cause for the
annulment of the Contract by the State of Arizona and that the State of Arizona
may retain to its own use from any sums of money due or become due thereunder,
an amount thereof equal to any brokerage, commission, or percentage so paid, or
agreed to be paid.
ARTICLE IV - TIME OF COMPLETION: The Contractor further covenants and
agrees that all of the said materials shall be furnished and delivered and all
of the said labor shall be done and performed in every respect to the
satisfaction and approval of the State Engineer and that the said work shall be
turned over to the State Engineer, complete and ready for use, on or before the
specified time herein. The work shall be free and discharged of all claims and
demands whatsoever for, or on account of any and all labor and materials used or
furnished to be used in said work.
It is expressly understood and agreed that in case of failure on the part
of the Contractor, for any reason, except with the written consent of the State
Engineer, to complete the entire work to the satisfaction of the State Engineer,
and within the aforesaid time limit, the party of the first part shall deduct
from any money due, or which may become due the Contractor, as liquidated
damages, an amount in accordance with Subsection 108.09 of the Contract
Specifications.
If no money shall be due the Contractor, the State shall have a cause of
action to recover against the Contractor in a court of competent jurisdiction,
liquidated damages, in accordance with Subsection 108.09 of the Contract
Specifications, said deduction to be made, or said sum to be recovered, not as a
penalty, but as liquidated damages; provided, however, that upon receipt of
written notice from the Contractor, of the existence of causes, as herein
provided, over which said Contractor has no control and which must delay the
completion of said work or any delay occasioned by the Arizona Department of
Transportation, the State Engineer may extend the period hereinbefore specified
for the completion of said work in accordance with the Specifications and in
such case, the Contractor shall become liable for said liquidated damages for
delays commencing from date said extension period shall expire.
After the date as set up in Contract plus any extension granted, no further
payments shall be made the Contractor until all work is completed and accepted
by the State engineer. It is also agreed that the date of completion shall be
that upon which the work is accepted by the State Engineer.
ARTICLE V - CLAIMS FOR EXTRA WORK: It is distinctly understood and agreed
that no claim for extra work or materials, not specifically herein provided,
done or furnished by the Contractor, will be allowed by the State Engineer, nor
shall the Contractor do any work or furnish any materials not covered by these
Specifications and Contract, unless such work is ordered in writing by the State
Engineer. In no event shall the Contractor incur any liability by reason of any
oral direction or instruction that he may be given by the State Engineer, or his
authorized representatives. It is the intent and meaning of this Article that
all orders, directions, instructions, not contained in the Plans,
Specifications, and Special Provisions, pertaining to the work shall be in
writing, and the Contractor hereby waives any claims for compensation for work
done, or materials furnished in violation thereof.
ARTICLE VI - MISUNDERSTANDING OR DECEPTION: The party of the second part
agrees that he has investigated the site of the work and all parts and
appurtenances thereto and hereby waives any right to plead misunderstanding or
deception as to location, character of work or materials, estimates of
quantities or other conditions surrounding or being a part of the work and
understands that the quantities given in the Bidding Schedule are approximate
only, and hereby agrees to accept the quantities as actually placed and finally
determined upon the completion of the work, in accordance with the Contract
Documents.
ARTICLE VII -PAYMENTS: For and in consideration of the faithful performance
of the work herein embraced, as set forth in the Contract Agreement,
Specifications, Special Provisions, Bidding Schedule and all general and
detailed Specifications and Plans, which are a part hereof, and in accordance
with the directions of the State Engineer and to his satisfaction or his
authorized agents, the said State of Arizona agrees to pay to said Contractor
the amount earned, computed from the actual quantities of work performed, as
shown by the estimates of the State Engineer, and the unit prices named in the
attached Bidding Schedule and Supplementary Agreements made a part hereof, and
to make such payments in the manner and at the time provided in the
specifications hereto appended.
Sheet 1 of 2
<PAGE>
ARTICLE VIII - IT IS EXPRESSLY UNDERSTOOD AND AGREED that no work shall be
done nor any obligations incurred under this contract during any fiscal year
which are in excess of the funds programmed and budgeted for this project for
that fiscal year.
ARTICLE IX - THE CONTRACTOR SHALL INDEMNIFY AND SAVE HARMLESS THE STATE,
its officers and employees, from all suits, actions or claims of any character
brought because of any injuries or damage received or sustained by any person,
persons or property on account of the operations of the said contractor or an
account of or in consequence of any neglect in safeguarding the work; or through
use of acceptable materials in constructing the work; or because of any act or
omission, neglect or misconduct of said contractor; or because of any claims or
amounts recovered from any infringements of patent, trademark or copyright; or
from any claims or amounts arising or recovered under the Workmen's Compensation
Act or any other law, ordinance, order or decree.
The contractor shall indemnify and save harmless any county or incorporated
city, its officers and employees, within the limits of which county or
incorporated city work is being performed, all in the same manner and to the
same extent as provided in the above paragraph.
IT IS FURTHER UNDERSTOOD AND AGREED that all work required to be done under
this contract in excess of the funds now appropriated and budgeted for this
project shall not be done nor any obligation incurred therefor until such time
as the Legislature appropriates the additional funds and the same are budgeted
for this project by the Arizona Department of Transportation and in that event
the parties hereto are bound to continue performance of this contract to the
extent permitted by the funds so appropriated and budgeted.
In the event that no funds are appropriated or budgeted for this project
for the succeeding fiscal year, then this contract shall be null and void,
except as to that portion for which funds have now been appropriated and
budgeted, therefore, and no right of action or damages shall accrue to the
benefit of the parties hereto as to that portion of the contract that may so
become null and void.
All parties are hereby put on notice that this contract (agreement) is
subject to cancellation by the Governor pursuant to Arizona Revised Statutes
Section 38-511.
IT IS ALSO UNDERSTOOD AND AGREED that this contract is subject to A.R.S.
28-1824, 28-1825, 28-1826, together with all other limitations pursuant to the
applicable laws of the State of Arizona relating to public contracts and
expenditures.
101L MA 041 H406001C RAM-600-1-542
PIMA FREEWAY (101L)
(Shea Boulevard - McDonald Drive)
Witness our hands and seals this 24th day of JUNE 1997
STATE OF ARIZONA
By: [SIGNATURE ILLEGIBLE]
--------------------------------
for State Engineer
EVIDENCE OF AUTHORITY TO SIGN
THE CONTRACT MUST BE ON FILE
WITH THE DEPARTMENT, OTHERWISE
IT MUST BE FURNISHED WITH THE
PROPOSAL.
PARTY OF THE FIRST PART
Meadow Valley Contractors, Inc.
-----------------------------------
By: [SIGNATURE ILLEGIBLE]
--------------------------------
Contractor
Attest: [SIGNATURE ILLEGIBLE] PARTY OF THE SECOND PART
----------------------
Seal
12-0912 R8/88
Contract Agreement
Sheet 2 of 2
ARTICLE IX
SEPT. 1969
JULY 1969
JULY 1, 1974
<PAGE>
STATUTORY PERFORMANCE BOND PURSUANT TO TITLE 34,
CHAPTER 2, ARTICLE 2 OF THE ARIZONA REVISED STATUTES
(PENALTY OF THIS BOND MUST BE 100% OF THE CONTRACT AMOUNT)
KNOW ALL MEN BY THESE PRESENTS: Bond No. 184239
That MEADOW VALLEY CONTRACTORS, INC. (hereinafter called the Principal), As
Principal, and THE INSURANCE COMPANY OF THE STATE OF PENNSYLVANIA AND NATIONAL
UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA. (hereinafter called Surety), a
corporation organized and existing under the laws of the State of PENNSYLVANIA
with its principal office in the city of New York, New York holding a
certificate of authority to transact surety business in Arizona issued by the
Director of the Department of Insurance, as Surety, are held and firmly bound
unto the Arizona Department of Transportation (hereinafter called the Obligee in
the amount of FIFTY-FOUR MILLION, SEVEN HUNDRED NINETY-EIGHT THOUSAND, FIVE
HUNDRED EIGHTY-SEVEN AND 92/100 dollars ($54,798,587.92), for the payment
whereof, the said Principal and Surety bind themselves, and their heirs,
administrator, executors, successors and assigns, jointly and severally, firmly
by these presents.
WHEREAS, the Principal has agreed to enter into a certain contract with the
Obligee for construction and completion of certain work described as
101L MA 041 H406001C RAM-600-1-542
PIMA FREEWAY (101L)
(Shea Boulevard - McDonald Drive)
which contract is hereby referred to and made a part hereof as fully and to the
same extent as if copied at length herein.
NOW, THEREFORE, THE CONDITION OF THIS OBLIGATION IS SUCH, that if the said
Principal shall faithfully perform and fulfill all the undertakings, covenants,
terms, conditions and agreements of said contract during the original term of
said contract any extension thereof, with or without notice to the Surety, and
during the life of any guaranty required under the contract, and shall also
perform and fulfill all the undertakings, covenants terms, conditions, and
agreements of any and all duly authorized modifications of said contract that my
hereafter be made, notice of which modifications to the Surety being hereby
waived: then the above obligation shall be void, otherwise to remain in full
force and effect;
PROVIDED, HOWEVER, that this bond is executed pursuant to the provisions of
Title 34, Chapter 2, Article 2, of the Arizona Revised Statues, and all
liabilities on this bond shall be determined in accordance with the provisions
of said Title, Chapter and Article, to the extent as if they were copied at
length herein.
The prevailing party in a suit on this bond shall recover as a part of the
judgment such reasonable attorneys' fees as may be fixed by a judge of the
Court.
Witness our hands this 5th day of June, 1997.
MEADOW VALLEY CONTRACTORS, INC. /s/ Robert W. Bottcher
- ---------------------------------------------- ----------------------------
PRINCIPAL SEAL BY ROBERT W. BOTTCHER
AREA MANAGER
THE INSURANCE COMPANY OF THE STATE OF
PENNSYLVANIA AND NATIONAL UNION FIRE INSURANCE
COMPANY OF PITTSBURGH, PA. /s/ Janina Monroe
- ---------------------------------------------- ----------------------------
SURETY BY Janina Monroe, Attorney
in Fact
1551 No. Tustin Avenue
Willis Corroon Corporation #1000, Santa Ana, CA 92705
- ---------------------------------------------- ----------------------------
AGENCY OF RECORD AGENCY ADDRESS
[SIGNATURE ILLEGIBLE]
- ----------------------------------------------
??? COUNTERSIGNATURE
??????????????????????????????????? PERFORMANCE BOND
- ----------------------------------------------
ADDRESS SHEET 1 OF 1
602-870-7000
- ----------------------------------------------
PHONE NUMBER
<PAGE>
EXHIBIT 10.71
CONTRACT
This Agreement, Made and entered into this 28th day of October, One Thousand
Nine Hundred and Ninety-Seven, in quadruplicate between the State of Nevada,
Department of Transportation thereof, party of the first part, and Meadow Valley
Contractors, Inc. P.O. Box 549, of Moapa, NV 89025, party of the second part,
hereinafter called the Contractor.
Witnesseth, That the said party of the second part agrees with the said
party of the first part, for the consideration and agreements hereinafter
mentioned and contained to be made and performed by the said party of the first
part, and under the conditions expressed in a bond bearing even date with these
presents, and hereunto annexed, that he, the said party of the second part,
shall and will at his own proper cost and expense, do all the work and furnish
all the materials necessary for the substantial construction and completion, and
to the satisfaction of said party of the first part, of a portion of the system
of Highways of the State of Nevada, being in the county of Clark on Interstate
-------------------
15 and US 95 Interchange (Las Vegas Spaghetti Bowl), Route Sections 015-1
- -------------------------------------------------- -----
Mileposts IR-015-CL-MP 42.87, in strict conformity, in every part and
------------------
particular, with the annexed special provisions and specifications, and the
plans entitled "State of Nevada, Department of Transportation; Construction
Plans of Proposed State Highway in the County of Clark, from the
---------------
California/Nevada State Line to 3,895 kilometers (2.42 miles) east of the
- -------------------------------------------------------------------------
Junction with Route US 093, Route Sections 015-1" approved by the Director of
- --------------------------
the Department of Transportation on April 18, 1997, which special provisions,
--------------
specifications and plans are made a part hereof, and in full compliance with the
terms of this agreement.
And the Contractor hereby further agrees to receive and accept the prices
set forth in the Proposal Schedule, hereto annexed and thereby made a part of
this agreement, as full compensation for furnishing all materials and labor, and
the doing of all work, in strict accordance with the plans, special provisions
and specifications hereinbefore mentioned, to the satisfaction of the Engineer
and in the manner and under the conditions hereinbefore specified.
The said party of the First part hereby promises and agrees with the said
Contractor, to employ, and does hereby employ, the said Contractor to provide
the materials and do the work according to the terms and conditions herein
contained and referred to, for the prices aforesaid, and hereby contracts to pay
the same at the time, in the manner, and upon the conditions above set forth;
and the said parties themselves, their heirs, executors, administrators,
successors, and assigns, do hereby agree to full performance of the covenants
herein contained. The Contractor further agrees that no moneys payable under
this contract shall be assigned by power of attorney, or otherwise, except upon
the written consent of the Department.
It is further agreed, by and between the parties hereto, that should there
be any conflict between the terms of this instrument and the bid or proposal of
said Contractor, then this instrument shall control, and nothing herein shall be
considered an acceptance of the said terms of said proposal conflicting
therewith.
And the said Contractor hereby further agrees that the payment of the final
amount due under this contract shall release the State of Nevada and the
Department of Transportation from any and all claims or liability on account of
work performed under this contract other than such claims, if any, as may be
specifically excepted by the Contractor in writing at the time final payment is
made.
478
IDR-DPC-0009(3) - 07/22/97
<PAGE>
CONTRACT
In Witness Whereof, The parties to these presents have hereunto set their hands
and seals the year and date first above written.
STATE OF NEVADA
Attested: Through the Department of Transportation
[SIGNATURE ILLEGIBLE] Dated November 24, 1997
- ---------------------------------------
(Director, Department of Transportation)
[SIGNATURE ILLEGIBLE]
------------------------------------
APPROVED AS TO FORM & LEGALITY (Chairman, Board of Directors, De-
partment of Transportation)
Meadow Valley Contractors, Inc.
------------------------------------
[Contractor]
/s/ Brian Hutchins
- ---------------------------------------
(Deputy Attorney General Chief Counsel) By [SIGNATURE ILLEGIBLE]
----------------------------------
VICE-PRESIDENT
------------------------------------
CONTRACTOR'S ACKNOWLEDGEMENT [USE (A) OR (B)]
(A) FOR AN INDIVIDUAL OR PARTNERSHIP
STATE OF _______________________________________ )
) SS
COUNTY OF ______________________________________ )
On this _______________ day of ___________________, A.D. _____________________,
personally appeared before me a ____________________________________________,
(Notary Public, Judge or other officer)
in and for ____________________________ County, State of ______________________
______________________________________________________________________, known
(Name)
(or proved) to me to be the person(s) described in and executed the foregoing
instrument, who acknowledged to me that he (they) executed the same freely and
voluntarily and for the uses and purposes therein mentioned.
________________________________________________
(Notary Public, Judge or other officer)
(B) FOR A CORPORATION
STATE OF NEVADA )
----------------------------------------- )
) SS
COUNTY OF CLARK )
---------------------------------------- )
On this 13th day of November, A.D. 1997, personally appeared before me a
Notary Public , in and for Clark County, State of
- ---------------------------------------
(Notary Public, Judge or other officer)
Nevada ALAN TERRIL, known (or proved) to me to be the VICE-PRESIDENT
----------- ------------------------
(Name) (President, Vice
President or Secretary)
of the corporation that executed the foregoing instrument, and, upon oath, did
depose that he is the officer of said corporation as above designated; that he
is acquainted with the seal of said corporation and that the seal affixed to
said instrument is the corporate seal of said corporation; that the signatures
to said instrument were made by officers of said corporation as indicated after
said signatures; and that the said corporation executed the said instrument
freely and voluntarily and for the uses and purposes therein mentioned.
[SEAL] NANCY A. MCCAFFERTY
-------------------------------------------
(Notary Public, Judge or other officer)
479
IDR-DPC-0009(3) - 07/22/97
<PAGE>
Bond
Executed in (4) counterparts Premium: $434,404.00
CONTRACTOR'S BOND
Know All Men By These Presents, That We Meadow Valley Contractors, Inc.
----------------------------------------
Contractor
P.O. Box 549, Moapa, NV 89025 as principal, and
- -------------------------------------------------------------
Address of Contractor
The Insurance Company of the State of Pennsylvania and National Union Fire
Insurance Company of Pittsburgh, P.a. 70 Pine Street, New York, New York, 10270
- --------------------------------------------------------------------------------
Name and Address of Bonding Company Main Office
as surety are held and firmly bound unto the State of Nevada in the sum of
Ninety One Million Eight Hundred Thirteen Thousand Eight Hundred Eight Four
- --------------------------------------------------------------------------------
Dollars and 08/100--------------------------------------------------------------
- --------------------------------------------------------------------------------
($91,813,884.08 ) dollars, to be paid to the said State of Nevada; for which
- -------------------
payment, well and truly to be made, we bind ourselves, our heirs, executors and
administrators, successors or assigns, jointly and severally, firmly by these
presents: That the total amount of said bond, two-thirds is conditioned that
such work under the contract shall be performed in accordance with the plans and
specifications and the terms of the contract, and one-third is conditioned to
provide and secure payment for all materials, provisions, supplies, trucks, and
other means of transportation used in, upon, or about, or for the performance of
the work contracted to be done, and for any work or labor done thereon.
The conditions of This Obligation is such, That Whereas, the above principal did
on the 28th day of October, 1997, enter into a contract with the Department of
---- ------- --
Transportation of the State of Nevada, for the performance of the following
specific work: Construction of a portion of the Interstate Highway System in
-----------------------------------------------------------------
Clark County, Nevada, on Interstate 15 and US 95 Interchange (Las Vegas
- --------------------------------------------------------------------------------
Spaghetti Bowl)
- --------------
Now, if the said Meadow Valley Contractors, Inc. heirs, executors,
--------------------------------------------
Contractor
administrators, successors and assigns, shall well and truly perform their part
of said contract, and if such work under the contract shall be performed in
accordance with the plans and specifications, and in strict conformity with the
terms of said contract, and every covenant and agreement therein contained, and
further, if the said Meadow Valley Contractors, Inc. shall indemnify and save
-------------------------------
Contractor
harmless the State of Nevada from and against all damages which it may sustain
by reason of liens for labor and materials furnished for said work, and if the
said Meadow Valley Contractors, Inc. shall pay all laborers, mechanics and
-------------------------------
Contractor
material men and persons who may have supplied provisions, supplies, trucks, and
other means of transportation used in, or about, or upon the said work, all just
debts due to such persons, or to any person to whom any part of such work was
given, and in addition all bills for labor, materials, sustenance, provisions,
or supplies used or consumed by subcontractors or otherwise in the performance
of the work contracted to be done, together with interest at the rate of twelve
percent per annum, then this obligation shall be void; otherwise to remain in
full force and effect.
And the said surety hereby stipulates and agrees that no change, extension,
alteration or addition to the terms of the contract or specifications shall in
any wise affect its obligation of this Bond.
[SIGNATURE ILLEGIBLE] Meadow Valley Contractors, Inc.
- ------------------------------------- -------------------------------------
Signature of Nevada Resident Agent (Name of Contractor)
[SIGNATURE ILLEGIBLE] By [SIGNATURE ILLEGIBLE]
- ------------------------------------- -----------------------------------
Name of Bonding Company Agent
Willis Corroon Corporation The Insurance Company of the State of
Pennsylvania*
- ------------------------------------- -------------------------------------
Address of Bonding Company Agent (Name of Bonding Company)
1551 N. Tustin Avenue, Suite 1000 By [SIGNATURE ILLEGIBLE]
- ------------------------------------- -----------------------------------
SANTA ANA, CA. 92705 Attorney in Fact
NOTE TO SURETY ON BOND:Certificates of Mike Parizino
authority for Attorneys in Fact must
be filed with the Nevada Department of
Transportation.
*and National Union Fire Insurance Company of Pittsburgh, Pa.
<PAGE>
EXHIBIT 10.72
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is entered into as of the 1st day of October
1997, by and between Meadow Valley Corporation, a Nevada corporation (the
"Employer"), and Kenneth D. Nelson (the "Employee").
The Employer hereby employs the Employee on a full-time basis, and the
Employee hereby accepts such full-time employment on the terms and conditions
hereinafter set forth.
1. EMPLOYMENT. Employee is employed as the Vice President - Corporate
----------
Administration for the Employer. Employee shall perform all duties as outlined
herein and as may be assigned by the Employer and shall devote full time,
attention and loyalty to the affairs of the Employer. The duties of the Employee
shall specifically be:
A) To provide oversight to the F-Cost system and provide assistance
to projects to insure proper accounting and allocation of field costs. To
provide supervisory assistance to Jim Vandegrift, or persons in similar
positions, as it relates to cost accounting requirements on all
construction projects in the Company. To provide assistance in preparing
and submitting accurate and timely Cash Flow (ECAC's).
B) To provide and/or delegate the training for proper use of F-Cost
and Cash Flow (ECAC's).
C) To provide oversight and coordinate the purchase, maintenance and
upgrading of all information systems software and hardware, as well as the
training of individuals as to their proper use.
D) To be responsible for all aspects of Risk Management, including
obtaining the most competitive insurance rates, negotiating with and
selecting insurance carriers and determining proper allocation of insurance
costs to operating units.
E) To assist the Company Safety/EEO Director in minimizing workers
compensation costs through competitive rates or assisting in countering
potentially fraudulent claims.
F) To coordinate with appropriate management all third party claims,
bond claims, arbitration or litigation in which the Company may be involved
and keep all interested parties informed of their status.
G) To monitor, approve and allocate the Company's legal costs and
assist/advise all operating units relative to selection of legal counsel.
H) To negotiate with, select and maintain adequate and competitive
employee health, welfare and dental plans.
I) To maintain the Company's 401(k), pension plans or any other
pension-related benefits that the Company has or may have in place.
J) Assist in various tracking and reporting, such as the Company's
bid results and backlog reports.
K) Assist in preparing annual operating budgets, strategic plans and
any special assignments related to acquisitions or mergers.
<PAGE>
L) Any other assignment as may be delegated by the Chief Executive
Officer, the Chief Financial Officer or the Chief Operating Officer.
2. TERM. Subject to the provisions of termination provided in paragraph
----
12, the initial term of this Agreement shall commence on October 1, 1997 and
terminate on September 30, 2002. This Agreement may be extended by the mutual
written agreement of the Employee and the Employer.
3. COMPENSATION. Employee shall receive a base salary of Ninety-five
------------
Thousand Dollars ($95,000,00) per year, payable in accordance with the regular
payroll practices of Employer, and subject to applicable deductions of
withholding taxes and other customary employment taxes. The Chief Executive
Officer of Employer shall review Employee's salary at a minimum annually and may
adjust Employee's salary upward to recognize improvement, achievement or
expansion of Employee's responsibilities subject to approval of the Board
Compensation Committee.
Employee shall participate as a member of senior management in cash
incentive plans as currently existing or as amended or adopted in the future by
the Compensation Committee of Employer's Board of Directors. Cash bonus plans
are subject to annual review and/or change as recommended by the Compensation
Committee and approved by the Board of Directors.
4. OPTIONS TO ACQUIRE COMMON STOCK. Employee is eligible to participate
-------------------------------
in the Meadow Valley Corporation 1994 Stock Option Plan. Future grants of stock
options shall be subject to the discretion of Meadow Valley Corporation's board
of directors.
5. EMPLOYEE BENEFITS. Employer shall provide to Employee, and to the
-----------------
Employee's dependents, a comprehensive major medical, health, and dental
insurance program comparable to the programs normally provided by other
employers in the same industry and marketplace, and the Employer shall pay the
cost of the Employee's portion of the premium. Should, at any time, the Employee
opt to maintain a personal major medical and health insurance policy for
himself and for his dependents and not participate in the Employer's group plan,
then Employer shall reimburse Employee the lesser of the amount Employee pays
for said personal policy, as evidenced by adequate documentation, or what
Employer would otherwise be paying were Employee participating in the Employer's
group plan. Should the Employee opt to maintain his own coverage, neither he nor
his dependents shall be precluded from later participating in the Employer's
group plan so long as they otherwise qualify for enrollment.
At Employer's cost, Employer will maintain a life insurance policy covering
Employee, with at least $250,000 of death benefits being payable, in a manner
that is free of income tax, to Employee's estate or other beneficiaries
designated by Employee.
Employer agrees to provide Employee with an automobile for business-related
use. In addition to the cost of the vehicle itself, Employer shall pay, directly
or by reimbursement to Employee, for all maintenance, fuel, repairs, insurance,
operating and other costs incidental thereto.
2
<PAGE>
Employer shall pay for, or reimburse Employee for, dues for his membership
in industry related associations perceived as beneficial to Employer and as
approved by the Chief Executive Officer or the Chief Operating Officer.
So long as it is within the guidelines of the respective plan, Employee
shall be given the opportunity to participate in Employer's 401(k) and any other
plans made available to other members of executive management.
Employee shall be entitled to receive all other employee benefits for
senior management personnel upon the terms and conditions then in effect.
6. MOVING EXPENSES AND SUBSISTENCE. In the event the Employer requires
-------------------------------
the Employee to relocate, the Employer shall pay for all moving costs of
reasonable and normal household effects, including up to six months storage of
such household effects while Employee obtains a permanent residence in the
relocation area. Employee shall obtain a minimum of two moving and storage
quotes from reputable movers and Employer shall pay the most competitive rate.
Employer shall provide Employee a subsistence allowance of Two Thousand
Dollars ($2,000.00) per month for the lesser of nine months from the date of
reassignment in a new location or until such time as the relocation of Employee
and his/her spouse to the relocation area is complete. In addition, costs for
one round-trip airline ticket per week between the Employee's previous location
and the relocation area will be reimbursed by Employer to Employee during the
same nine-month period, or less if relocation is completed earlier. Such tickets
may be used either by Employee or by his/her spouse.
7. HOLIDAYS AND VACATION.
---------------------
A) Employee shall be paid for the following seven (7) holidays: New
Year's Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
the day after Thanksgiving, and Christmas Day and all other holidays for
Employees of the Company as approved by the Chief Executive Officer or
Board of Directors.
B) Employee is entitled to four weeks vacation during the first year
of employment and for each year thereafter. Unused vacation in any given
year shall accrue to following years up to a maximum of eight weeks in any
one year.
8. RESPONSIBILITIES OF EMPLOYEE. The Employee shall devote such
----------------------------
reasonable time as is necessary or is deemed reasonably necessary by the
Employer to carry out all required duties and will devote full time to the
Employer during normal business hours. The Employee shall at all times
faithfully, with diligence and to the Employee's best good faith ability,
experience and talents, perform all the duties that may be required pursuant to
the express terms hereof to the reasonable satisfaction of the Employer, in
accordance with customary professional standards.
9. WORKING FACILITIES. The Employee shall be furnished with all
------------------
facilities and services suitable to Employee's position and adequate for the
performance of Employee's duties.
3
<PAGE>
10. EXPENSES. The Employee is authorized to incur reasonable expenses for
--------
promoting business of the Employer, including expenses for entertainment, travel
and similar items. The Employer shall reimburse the Employee for all such
expenses on the presentation by the Employee of itemized and adequately
documented accounts of such expenditures.
11. DISABILITY. If unable to perform duties the terms of this Agreement
----------
by reason of illness or incapacity for a period of four weeks, Employee
shall, commencing at the end of such four week period, be entitled to receive
Employee's compensation hereunder for a period of up to and including a maximum
of one year or until he is no longer disabled, whichever occurs first. After one
year of disability at ful salary, the Employee, or his designated beneficiary,
shall be provided with a disability insurance policy, if available, at no cost
to Employee. The disability income policy would provide for monthly income
benefits at the rate of sixty percent (60%) of the Employee's base salary at the
time the disability occurred. The Company will attempt to procure a disability
income policy that would provide monthly benefits until the Employee reaches 65
years of age or is no longer disabled whichever occurs first. If such a policy
is unavailable, the Company will attempt to provide the best policy available.
If no policy is available, no other disability income benefits will be provided.
12. TERMINATION. This Employment Agreement may be terminated under the
-----------
following circumstances:
A) WITHOUT CAUSE. Employer may terminate this Agreement at any time
-------------
upon thirty (30) days written notice to Employee, but Employer shall be
obligated to pay to Employee compensation in a lump sum for the balance of
the term of this Agreement within 30 days of termination, unless Employee
agrees to other payment terms.
B) VOLUNTARY TERMINATION BY EMPLOYEE WITHOUT CAUSE. Employee may
-----------------------------------------------
terminate this Agreement at any time upon thirty (30) days written notice
to Employer and Employer shall be obligated, in that event, to pay Employee
compensation up to the date of the termination only. All accrued but unpaid
compensation and Employee benefits shall be paid in cash within 30 days of
termination, unless Employee agrees to other payment terms.
C) TERMINATION BY EMPLOYER FOR REASONABLE CAUSE. The Employer may
--------------------------------------------
terminate this Agreement for reasonable cause upon the unanimous vote of
the Board of Directors and by thirty (30) days written notice to the
Employee and Employer shall be obligated, in that event, to pay Employee
compensation up to the date of termination only. For purposes hereof,
"cause" shall be defined as meaning (i) such conduct by the Employee which
constitutes material breach of this Agreement which is not cured within
ninety (90) days of written notice to the Employee of said alleged breach
or (ii) a material failure to competently perform Employee's duties as
stated in paragraph 1 in accordance with applicable professional standards
as stated in paragraphs 1 and 8 hereof provided that Employer has
previously given Employee written notice and a reasonable opportunity to
remedy such failure and such failure has a materially
4
<PAGE>
adverse effect on the business or financial condition of Employer or (iii)
material breach of Employee's fiduciary duty and such breach has a material
adverse effect on the business or financial condition of Employer or (iv)
egregiously improper or illegal conduct of the Employee which, based upon a
unanimous good faith determination of the Board of Directors of the
Employer, has a material adverse affect on Employer.
D) TERMINATION BY EMPLOYEE FOR REASONABLE CAUSE. Employee may
--------------------------------------------
terminate this Agreement for cause. In such event, Employer shall be
obligated to pay Employee compensation in lump sum for the balance of the
term of this Agreement within 30 days of termination or as Employee shall
agree, plus damages suffered and expenses incurred by reason thereof. For
this purpose "cause" shall mean (i) a material breach of this Agreement by
Employer or (ii) failure of Employer to pay any amount owed Employee
hereunder at the time and in the amount due or (iii) failure of Employer to
follow applicable law, especially with respect to SEC filing and compliance
over the objection of Employee or contrary to the reasonable advice of
Employee or (iv) egregiously improper conduct with respect to dealing with
Employee or in a manner which brings discredit to Employee.
13. CONFIDENTIALLY. Employee agrees not to disclose any confidential,
--------------
propriety competitively sensitive information to persons who are not employees,
directors, lenders, bonding agents, insurance companies or advisors of the
Employer, except as required by law, without prior consent of the Employer,
provided however, any disclosure involving this paragraph shall not result in a
breach of this Agreement unless the disclosure has a materially adverse effect
on the Employer.
14. INDEMNIFICATION. Employer and Meadow Valley Contractors, Inc. shall
---------------
provide Employee with an Officer Indemnification Agreement in the form attached
hereto.
15. NOTICES. All notices, demands, and communications given under this
-------
Agreement ("Notice") shall be in writing and delivered personally or sent by
registered or certified mail, return receipt requested, in the United States
mail, postage prepaid, addressed as follows:
If to Employer:
Meadow Valley Corporation
P.O. Box 60726
Phoenix, AZ 85082-0726
If to Employee:
Kenneth D. Nelson
1255 E. Nance
Mesa, AZ 85203
5
<PAGE>
or at such address as a party may from time to time designate by Notice
hereunder. Notice shall be effective upon delivery in person, or if mailed, at
midnight on the third business day after the date of mailing.
16. ASSIGNMENT OF AGREEMENT. Neither party may assign or otherwise
-----------------------
transfer this Agreement or any of its rights or obligations hereunder without
the prior written consent to such assignment or transfer by the other party
hereto; and all the provisions of this Agreement shall be binding upon the
respective employees, successors, heirs and assigns of the parties; provided,
however, the benefits payable to Employee hereunder in the event of disability
or death or incapacity are payable to Employee's spouse or personal
representative.
17. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS. This Agreement
-----------------------------------------------------
and the representations, warranties, covenants and other agreements (however
characterized or described) by both parties and contained herein or made
pursuant to the provisions hereof shall survive the execution and delivery of
this Agreement.
18. FURTHER INSTRUMENTS. The parties shall execute and deliver any and
-------------------
all such other instruments in reasonable mutually acceptable form and substance
and shall take any and all such other actions as may be reasonably necessary to
carry the intent of the Agreement into full force and effect.
19. SEVERABILITY. If any provision of this Agreement shall be held,
------------
declared or pronounced void, voidable, invalid, unenforceable or inoperative for
any reason by any court of competent jurisdiction, governmental authority or
otherwise, such holding, declaration or pronouncement shall not affect adversely
any other provision of this Agreement, which shall otherwise remain in full
force and effect and be enforced in accordance with its terms, and the effect of
such holding, declaration or pronouncement shall be limited to the territory of
jurisdiction in which made.
20. WAIVER. All the rights and remedies of either party under this
------
Agreement are cumulative and not exclusive of any other rights and remedies
provided by law. No delay or failure on the part of either party in the exercise
of any right or remedy arising from a breach of this Agreement shall operate as
a waiver of any subsequent right or remedy arising from a subsequent breach of
this Agreement. The consent of any party where required hereunder to any act or
occurrence shall not be deemed to be a consent to any other act or occurrence.
21. GENERAL PROVISIONS. This Agreement shall be construed and enforced in
------------------
accordance with, and governed by, the laws of the state of Arizona. Except as
otherwise expressly stated herein, time is of the essence in performance under
this Agreement. This Agreement embodies the entire agreement and understanding
between the parties and supersedes all prior agreements and understandings
relating to the subject
6
<PAGE>
matter of this Agreement as it relates to the parties' duties and obligations
from and after April 1, 1997, and this Agreement may not be modified or amended
or any term or provision hereof waived or discharged except in writing signed by
the party against whom such amendment, modification, waiver or discharge is
sought to be enforced. The headings of this Agreement are for convenience in
reference only and shall not limit or otherwise affect the meaning thereof. This
Agreement may be executed in any number of counterparts, each of which shall be
deemed an original but all of which taken together shall constitute one and the
same instrument.
22. SPECIAL RIGHT OF EMPLOYEE UNDER CERTAIN CIRCUMSTANCES. During the term
-----------------------------------------------------
of this Agreement, if (i) Employer is involved in a merger, consolidation or
other business combination in which Employer is not the surviving and
controlling entity; or (ii) all or substantially all the assets of Employer or
its principal subsidiary are sold; or (iii) in the event Employee is required to
relocate outside the Pheonix metropolitan area in a manner not mutually
acceptable to Employee and Employer, then Employee shall have the following
rights:
A) To terminate this Agreement with 30 days prior notice, in which event
Employer shall pay Employee as if there a termination without cause by the
Employer; and
B) All options granted shall, to the extent not specifically prohibited
by the stock option plan then in effect, vest immediately and be exercisable
within one year of the occurring of one of the events set forth in (i), (ii) or
(iii) above.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year
first above written.
Meadow Valley Corporation
/s/ Kenneth D. Nelson By /s/ Bradley E. Larson
- ----------------------------- ---------------------------------
Employee President/CEO
7
<PAGE>
MEADOW VALLEY CORPORATION AND
MEADOW VALLEY CONTRACTORS, INC.
OFFICER/DIRECTOR INDEMNIFICATION AGREEMENT
------------------------------------------
THIS AGREEMENT ("Agreement") is entered into and effective this 1st day of
October, 1997, by and between Meadow Valley Corporation and Meadow Valley
Contractors, Inc., Nevada corporations ("Corporation"), and Kenneth D. Nelson
("Indemnified Party").
WHEREAS, the Board of Directors has determined that it is in the best
interest of the Corporation and its shareholders to agree to indemnify
Indemnified Party (who is a Director and/or Officer of the Corporation) from and
against certain liabilities for actions taken by him during the performance of
his tasks for the Corporation.
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt, adequacy and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. INDEMNIFICATION. The Corporation hereby agrees to indemnify and hold
---------------
harmless Indemnified Party to the maximum extent possible under all applicable
laws against any and all claims, demands, debts, duties, liabilities, judgments,
fines and amounts paid in settlement and expenses (including attorneys' fees and
expenses) actually and reasonably incurred by Indemnified Party in connection
with the investigation, defense, negotiation and settlement of any such claim or
any threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (including an action by or in the
right of the Corporation) to which Indemnified Party is or becomes a party, or
is threatened to be made a party, by reason of the fact that Indemnified Party
is an officer or a director of the Corporation or any of its subsidiaries.
2. LIMITATIONS ON INDEMNITY. No indemnity pursuant to this Agreement
------------------------
shall be made by the Corporation:
(a) For the amount of such losses for which the Indemnified Party is
indemnified pursuant to any insurance purchased and maintained by the
Corporation; or
(b) In respect to remuneration paid to Indemnified Party if it shall be
determined by a final judgment or other final adjudication that such
remuneration was in violation of law; or
(c) On account of any suit in which judgment is rendered against
Indemnified Party for an accounting of profits made (i) for an
improper personal profit without full and fair disclosure to the
Corporation of all material conflicts of interest and not approved
thereof by a majority of the disinterested members of the Board of
Directors of the Corporation; or (ii) from the purchase or sale by
Indemnified Party of securities of the Corporation pursuant to the
provisions of Section 16(b) of the Securities Exchange Act
<PAGE>
of 1934 and amendments thereto or similar provisions of any federal,
state or local law; or
(d) On account of Indemnified Party's conduct which is finally determined
to have been knowingly fraudulent, deliberately dishonest or willfully
in violation of applicable law for which the corporation suffered
actual financial damages; or
(e) If a final decision by a court having jurisdiction in the matter shall
determine that such indemnification is not lawful.
3. CONTINUATION OF INDEMNITY. All agreements and obligations of the
-------------------------
Corporation contained herein shall continue during the period Indemnified Party
is an officer or director of the Corporation or a subsidiary and thereafter so
long as Indemnified Party shall be subject to any possible claim or threatened,
pending or completed action, suit or proceeding, whether civil, criminal or
investigative, by reason of the fact that Indemnified Party was an officer or a
director of the Corporation or any subsidiary.
4. NOTIFICATION AND DEFENSE OF CLAIM. Within 30 days after receipt by
---------------------------------
Indemnified Party of notice of any claim or any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative, in which Indemnified Party has a right to Indemnification
hereunder, Indemnified Party will notify the Corporation of the commencement
thereof. With respect to any such action, suit or proceeding as to which
Indemnified Party notifies the Corporation of the commencement thereof:
(a) The Corporation will be entitled to participate therein at its own
expense; and
(b) Except as otherwise provided below, to the extent that it may wish,
the Corporation jointly with any other indemnifying party will be
entitled to assume the defense thereof, with counsel satisfactory to
Indemnified Party. After notice from the Corporation to Indemnified
Party of its election to assume the defense thereof, the Corporation
will not be liable to Indemnified Party under this Agreement for any
legal or other expenses subsequently incurred by Indemnified Party in
connection with the defense thereof other than reasonable costs of
investigation or as otherwise provided below. Indemnified Party shall
have the right to employ counsel in such action, suit or proceeding,
but the fees and expenses of such counsel incurred after notice from
the Corporation of its assumption of the defense thereof shall be at
the expense of Indemnified Party, unless (i) the employment of
counsel by Indemnified Party has been authorized by the Corporation,
(ii) Indemnified Party shall have reasonably concluded that there may
be a conflict of interest between the Corporation and Indemnified
Party in the conduct of the defense of such action, (iii) the
Corporation shall not in fact have employed counsel to assume the
defense of such action, in each of which cases the fees and expenses
of counsel shall be at the expense of the Corporation, or (iv) unless
the Indemnified
2
<PAGE>
Party reasonably and in good faith asserts defenses and theories of
defense not asserted by the Corporation. The Corporation shall not be
entitled to assume the defense of any action, suit or proceeding
brought by or on behalf of the Corporation or as to which Indemnified
Party shall have made the conclusion provided for in (ii) or (iv)
above.
(c) The Corporation shall not be liable to indemnify Indemnified Party
under this Agreement for any amounts paid in settlement of any action
or claim effected without the Corporation's written consent. The
Corporation shall not settle any action or claim in any manner which
would impose any penalty or limitation on Indemnified Party without
Indemnified Party's written consent. Neither the Corporation or
Indemnified Party will unreasonably withhold their consent to any
proposed settlement.
5. REPAYMENT OF EXPENSES. Indemnified Party agrees that Indemnified
---------------------
Party will reimburse the Corporation for all reasonable expenses paid by the
Corporation in defending any civil or criminal action, suit or proceeding
against Indemnified Party in the event and only to the extent that Indemnified
Party is finally determined that Indemnified Party is not entitled to be
indemnified by the Corporation for such expenses under the Corporation's charter
or bylaws, this Agreement or under applicable law.
6. ENFORCEMENT.
-----------
(a) The Corporation expressly confirms and agrees that it has entered into
this Agreement and assumed the obligations imposed on the Corporation
hereby in order to induce Indemnified Party to serve as an officer
and/or director of the Corporation or any subsidiary thereof, and
acknowledges that Indemnified Party is relying upon this Agreement as
part of the consideration for so acting.
(b) In the event Indemnified Party is required to bring any action enforce
rights or to collect moneys due under this Agreement and is successful
in such action, the Corporation shall reimburse Indemnified Party for
all of Indemnified Party's reasonable attorneys' and other fees and
expenses in bringing and pursuing such action.
7. SEVERABILITY. Each of the provisions of this Agreement is a separate
------------
and distinct agreement and independent of the others, so that if any provision
hereof shall be held to be invalid or unenforceable for any reason, such
invalidity or unenforceability shall not affect the validity or enforceability
of the other provisions hereof.
8. GOVERNMENT LAW; BINDING EFFECT; AMENDMENT AND TERMINATION.
---------------------------------------------------------
(a) This Agreement shall be interpreted and enforced in accordance with
the laws of the State of Arizona.
(b) This Agreement shall be binding upon Indemnified Party and upon the
Corporation, its successors and assigns, and shall inure to the
benefit of
3
<PAGE>
Indemnified Party, his heirs, personal representatives and assigns and
to the benefit of the Corporation, its successors and assigns.
(c) No amendment, modification, termination or change of this Agreement
shall be effective unless it is signed by both parties hereto.
9. ADDITIONAL RIGHTS. This Agreement is in addition to, and not in lieu
-----------------
of, any other right to indemnification under the Corporation's corporate
charter, bylaws, insurance contracts or otherwise at law or in equity.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and
as of the day and year first above written.
MEADOW VALLEY CORPORATION AND
MEADOW VALLEY CONTRACTORS, INC.
By: /s/ Bradley E. Larson
-----------------------------------------------
Bradley E. Larson, President and Chief Executive
Officer
Indemnified Party:
/s/ Kenneth D. Nelson
--------------------------------------------------
Kenneth D. Nelson
4
<PAGE>
EXHIBIT 10.73
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is entered into as of the 1st day of October
1997, by and between Meadow Valley Corporation, a Nevada corporation (the
"Employer"), and Alan A. Terril (the "Employee").
The Employer hereby employs the Employee on a full-time basis, and the
Employee hereby accepts such full-time employment on the terms and conditions
hereinafter set forth.
1. EMPLOYMENT. Employee is employed as the Senior Vice President - Nevada
----------
Area Manager for the Employer. Employee shall perform all duties as outlined
herein and as may be assigned by the Employer and shall devote full time,
attention and loyalty to the affairs of the Employer. The duties of the Employee
shall specifically be:
A) Complete responsibility for the operational aspects of the Nevada
Area, including profit and loss responsibility.
B) To select, hire and maintain qualified project management
personnel on all Nevada Area projects and to administer and review annually
the performance of each person within direct supervision and adjust
compensation in accordance with Company guidelines and subject to the
approval of the Chief Operating Officer.
C) To oversee the selection, preparation and submission of bid
proposals and to determine margins in order to maximize Company
profitability.
D) To oversee the preparation of project budgets for submission to
the Chief Operating Officer for approval, to insure that cost controls are
in place and utilized to accurately track project costs, to monitor project
schedules and to provide decision-making problem-solving assistance for all
project management. To oversee the negotiation, preparation and execution
of all subcontracts and purchase agreements within the Nevada Area.
E) To maintain and promote relationships with owners with whom the
Company contracts.
F) To insure that periodic reporting such as project Cash Flows
(ECAC's), pay estimates are prepared and submitted correctly and on a
timely basis.
G) Prepares annual operating budgets and capital expenditure budgets
and periodic forecasts as required.
H) Resolve complaints and/or claims relating to Nevada Area
projects, or to provide assistance in preparing for and presenting the
Company's position in claims hearings.
I) To provide input and counsel to strategic and business plans for
the entire Company.
J) To assist in any other projects or duties as may be assigned by
the Chief Operating Officer.
2. TERM. Subject to the provisions of termination provided in paragraph
----
12, the initial term of this Agreement shall commence on October 1, 1997 and
terminate
<PAGE>
on September 30, 2002. This Agreement may be extended by the mutual written
agreement of the Employee and the Employer.
3. COMPENSATION. Employee shall receive a base salary of One Hundred
------------
Thousand Dollars ($100,000.00) per year, payable in accordance with the regular
payroll practices of Employer, and subject to applicable deductions of
withholding taxes and other customary employment taxes. The Chief operating
Officer of Employer shall review Employee's salary at a minimum annually and may
adjust Employee's salary upward to recognize improvement, achievement or
expansion of Employee's responsibilities subject to approval of the Board
Compensation Committee.
Employee shall participate as a member of senior management in cash
incentive plans as currently existing or as amended or adopted in the future by
the Compensation Committee of Employer's Board of Directors. Cash bonus plans
are subject to annual review and/or change as recommended by the Compensation
Committee and approved by the Board of Directors.
4. OPTIONS TO ACQUIRE COMMON STOCK. Employee is elligible to participate
-------------------------------
in the Meadow Valley Corporation 1994 Stock Option Plan. Future grants of stock
options shall be subject to the discretion of Meadow Valley Corporation's board
of directors.
5. EMPLOYEE BENEFITS. Employer shall provide to Employee, and to the
-----------------
Employee's dependents, a comprehensive major medical, health, and dental
insurance program comparable to the programs normally provided by other
employers in the same industry and marketplace, and the Employer shall pay the
cost of the Employee's portion of the premium. Should, at any time, the Employee
opt to maintain a personal major medical and health insurance policy for
himself and for his dependents and not participate in the Employer's group plan,
then Employer shall reimburse Employee the lesser of the amount Employee pays
for said personal policy, as evidenced by adequate documentation, or what
Employer would otherwise be paying were Employee participating in the Employer's
group plan. Should the Employee opt to maintain his own coverage, neither he nor
his dependents shall be precluded from later participating in the Employer's
group plan so long as they otherwise qualify for enrollment.
At Employer's cost, Employer will maintain a life insurance policy covering
Employee, with at least $250,000 of death benefits being payable, in a manner
that is free of income tax, to Employee's estate or other beneficiaries
designated by Employee.
Employer agrees to provide Employee with an automobile for business-related
use. In addition to the cost of the vehicle itself, Employer shall pay, directly
or by reimbursement to Employee, for all maintenance, fuel, repairs, insurance,
operating and other costs incidental thereto.
Employer shall pay for, or reimburse Employee for, dues for his membership
in industry related associations perceived as beneficial to Employer and as
approved by the Chief Executive Officer or the Chief Operating Officer.
2
<PAGE>
So long as it is within the guidelines of the respective plan, Employee
shall be given the opportunity to participate in Employer's 401(k) and any other
plans made available to other members of executive management.
Employee shall be entitled to receive all other employee benefits for
senior management personnel upon the terms and conditions then in effect.
6. MOVING EXPENSES AND SUBSISTENCE. In the event the Employer requires
-------------------------------
the Employee to relocate, the Employer shall pay for all moving costs of
reasonable and normal household effects, including up to six months storage of
such household effects while Employee obtains a permanent residence in the
relocation area. Employee shall obtain a minimum of two moving and storage
quotes from reputable movers and Employer shall pay the most competitive rate.
Employer shall provide Employee a subsistence allowance of Two Thousand
Dollars ($2,000.00) per month for the lesser of nine months from the date of
reassignment in a new location or until such time as the relocation of Employee
and his/her spouse to the relocation area is complete. In addition, costs for
one round-trip airline ticket per week between the Employee's previous location
and the relocation area will be reimbursed by Employer to Employee during the
same nine-month period, or less if relocation is completed earlier. Such tickets
may be used either by Employee or by his/her spouse.
7. HOLIDAYS AND VACATION.
---------------------
A) Employee shall be paid for the following seven (7) holidays: New
Year's Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
the day after Thanksgiving, and Christmas Day and all other holidays for
Employees of the Company as approved by the Chief Executive Officer or
Board of Directors.
B) Employee is entitled to four weeks vacation during the first year
of employment and for each year thereafter. Unused vacation in any given
year shall accrue to following years up to a maximum of eight weeks in any
one year.
8. RESPONSIBILITIES OF EMPLOYEE. The Employee shall devote such
----------------------------
reasonable time as is necessary or is deemed reasonably necessary by the
Employer to carry out all required duties and will devote full time to the
Employer during normal business hours. The Employee shall at all times
faithfully, with diligence and to the Employee's best good faith ability,
experience and talents, perform all the duties that may be required pursuant to
the express terms hereof to the reasonable satisfaction of the Employer, in
accordance with customary professional standards.
9. WORKING FACILITIES. The Employee shall be furnished with all
------------------
facilities and services suitable to Employee's position and adequate for the
performance of Employee's duties.
10. EXPENSES. The Employee is authorized to incur reasonable expenses
--------
for promoting business of the Employer, including expenses for entertainment,
travel and similar items. The Employer shall reimburse the Employee for all such
expenses on the
3
<PAGE>
presentation by the Employee of itemized and adequately documented accounts of
such expenditures.
11. DISABILITY. If unable to perform duties under the terms of this
----------
Agreement by reason of illness or incapacity for a period of four weeks,
Employee shall, commencing at the end of such four week period, be entitled to
receive Employee's compensation hereunder for a period of up to and including a
maximum of one year or until he is no longer disabled, whichever occurs first.
After one year of disability at full salary, the Employee, or his designated
beneficiary, shall be provided with a disability insurance policy, if available,
at no cost to Employee. The disability income policy would provide for monthly
income benefits at the rate of sixty percent (60%) of the Employee's base salary
at the time the disability occurred. The Company will attempt to procure a
disability income policy that would provide monthly benefits until the Employee
reaches 65 years of age or is no longer disabled whichever occurs first. If such
a policy is unavailable, the Company will attempt to provide the best policy
available. If no policy is available, no other disability income benefits will
be provided.
12. TERMINATION. This Employment Agreement may be terminated under the
-----------
following circumstances.
A) WITHOUT CAUSE. Employer may terminate this Agreement at any time
-------------
upon thirty (30) days written notice to Employee, but Employer shall be
obligated to pay to Employee compensation in a lump sum for the balance of
the term of this Agreement within 30 days of termination, unless Employee
agrees to other payment terms.
B) VOLUNTARY TERMINATION BY EMPLOYEE WITHOUT CAUSE. Employee may
-----------------------------------------------
terminate this Agreement at any time upon thirty (30) days written notice
to Employer and Employer shall be obligated, in that event, to pay
Employee compensation up to the date of the termination only. All accrued
but unpaid compensation and Employee benefits shall be paid in cash within
30 days of termination, unless Employee agrees to other payment terms.
C) TERMINATION BY EMPLOYER FOR REASONABLE CAUSE. The Employer may
--------------------------------------------
terminate this Agreement for reasonable cause upon the unanimous vote of
the Board of Directors and by thirty (30) days written notice to the
Employee and Employer shall be obligated, in that event, to pay Employee
compensation up to the date of termination only. For purposes hereof,
"cause" shall be defined as meaning (i) such conduct by the Employee which
constitutes material breach of this Agreement which is not cured within
ninety (90) days of written notice to the Employee of said alleged breach
or (ii) a material failure to competently perform Employee's duties as
stated in paragraph 1 in accordance with applicable professional standards
as stated in paragraph 1 and 8 hereof provided that Employer has previously
given Employee written notice and a reasonable opportunity to remedy such
failure and such failure has a materially adverse effect on the business or
financial condition of Employer or (iii) material breach of Employee's
fiduciary duty and such breach has a material adverse effect on the
business or financial condition of Employer or (iv) egregiously improper or
4
<PAGE>
illegal conduct of the Employee which, based upon a unanimous good faith
determination of the Board of Directors of the Employer, has a material
adverse affect on Employer.
D) TERMINATION BY EMPLOYEE FOR REASONABLE CAUSE. Employee may
--------------------------------------------
terminate this Agreement for cause. In such event, Employer shall be
obligated to pay Employee compensation in lump sum for the balance of the
term of this Agreement within 30 days of termination or as Employee shall
agree, plus damages suffered and expenses incurred by reason thereof. For
this purpose "cause" shall mean (i) a material breach of this Agreement by
Employer or (ii) failure of Employer to pay any amount owed Employee
hereunder at the time and in the amount due or (iii) failure of Employer to
follow applicable law, especially with respect to SEC filing and compliance
over the objection of Employee or contrary to the reasonable advice of
Employee or (iv) egregiously improper conduct with respect to dealing with
Employee or in a manner which brings discredit to Employee.
13. CONFIDENTIALLY. Employee agrees not to disclose any confidential,
--------------
propriety competitively sensitive information to persons who are not employees,
directors, lenders, bonding agents, insurance companies or advisors of the
Employer, except as required by law, without prior consent of the Employer,
provided however, any disclosure involving this paragraph shall not result in a
breach of this Agreement unless the disclosure has a materially adverse effect
on the Employer.
14. INDEMNIFICATION. Employer and Meadow Valley Contractors, Inc. shall
---------------
provide Employee with an Officer Indemnification Agreement in the form attached
hereto.
15. NOTICES. All notices, demands, and communications given under this
-------
Agreement ("Notice") shall be in writing and delivered personally or sent by
registered or certified mail, return receipt requested, in the United States
mail, postage prepaid, addressed as follows:
If to Employer:
Meadow Valley Corporation
P.O. Box 60726
Phoenix, AZ 85082-0726
If to Employee:
Alan A. Terril
P.O. Box 364
Overton, NV 89040
5
<PAGE>
or at such other address as a party may from time to time designate by Notice
hereunder. Notice shall be effective upon delivery in person, or if mailed, at
midnight on the third business day after the date of mailing.
16. ASSIGNMENT OF AGREEMENT. Neither party may assign or otherwise
-----------------------
transfer this Agreement or any of its rights or obligations hereunder without
the prior written consent to such assignment or transfer by the other party
hereto; and all the provisions of this Agreement shall be binding upon the
respective employees, successors, heirs and assigns of the parties; provided,
however, the benefits payable to Employee hereunder in the event of disability
or death or incapacity are payable to Employee's spouse or personal
representative.
17. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS. This Agreement
-----------------------------------------------------
and the representations, warranties, covenants and other agreements (however
characterized or described) by both parties and contained herein or made
pursuant to the provisions hereof shall survive the execution and delivery of
this Agreement.
18. FURTHER INSTRUMENTS. The parties shall execute and deliver any and
-------------------
all such other instruments in reasonable mutually acceptable form and substance
and shall take any and all such other actions as may be reasonably necessary to
carry the intent of the Agreement into full force and effect.
19. SEVERABILITY. If any provision of this Agreement shall be held,
------------
declared or pronounced void, voidable, invalid, unenforceable or inoperative for
any reason by any court of competent jurisdiction, governmental authority or
otherwise, such holding, declaration or pronouncement shall not affect adversely
any other provision of this Agreement, which shall otherwise remain in full
force and effect and be enforced in accordance with its terms, and the effect of
such holding, declaration or pronouncement shall be limited to the territory of
jurisdiction in which made.
20. WAIVER. All the rights and remedies of either party under this
------
Agreement are cumulative and not exclusive of any other rights and remedies
provided by law. No delay or failure on the part of either party in the exercise
of any right or remedy arising from a breach of this Agreement shall operate as
a waiver of any subsequent right or remedy arising from a subsequent breach of
this Agreement. The consent of any party where required hereunder to any act or
occurrence shall not be deemed to be a consent to any other act or occurrence.
21. GENERAL PROVISIONS. This Agreement shall be construed and enforced in
------------------
accordance with, and governed by, the laws of the state of Arizona. Except as
otherwise expressly stated herein, time is of the essence in performing under
this Agreement. This Agreement embodies the entire agreement and understanding
between the parties and supersedes all prior agreements and understandings
relating to the subject matter of this Agreement as it relates to the parties'
duties and obligations from and after
6
<PAGE>
April 1, 1997, and this Agreement may not be modified or amended or any term or
provision hereof waived or discharged except in writing signed by the party
against whom such amendment, modification, waiver or discharge is sought to be
enforced. The headings of this Agreement are for convenience in reference only
and shall not limit or otherwise affect the meaning thereof. This Agreement may
be executed in any number of counterparts, each of which shall be deemed an
original but all of which taken together shall constitute one and the same
instrument.
22. SPECIAL RIGHT OF EMPLOYEE UNDER CERTAIN CIRCUMSTANCES. During the term
-----------------------------------------------------
of this Agreement, if (i) Employer is involved in a merger, consolidation or
other business combination in which Employer is not the surviving and
controlling entity; or (ii) all or substantially all the assets of Employer or
its principal subsidiary are sold; or (iii) in the event Employee is required to
relocate outside the Overton, Nevada area in a manner not mutually acceptable to
Employee and Employer, then Employee shall have the following rights:
A) To terminate this Agreement with 30 days prior notice, in which event
Employer shall pay Employee as if there were a termination without cause by the
Employer; and
B) All options granted shall, to the extent not specifically prohibited
by the stock option plan then in effect, vest immediately and be exercisable
within one year of the occurring of one of the events set forth in (i), (ii) or
(iii) above.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year
first above written.
Meadow Valley Corporation
/s/ Alan A. Terril By /s/ Bradley E. Larson
- ----------------------------- ---------------------------------
Employee President/CEO
7
<PAGE>
MEADOW VALLEY CORPORATION AND
MEADOW VALLEY CONTRACTORS, INC.
OFFICER/DIRECTOR INDEMNIFICATION AGREEMENT
------------------------------------------
THIS AGREEMENT ("Agreement") is entered into and effective this 1 day of
October, 1997, by and between Meadow Valley Corporation and Meadow Valley
Contractors, Inc., Nevada corporations ("Corporation"), and Alan A. Terril
("Indemnified Party").
WHEREAS, the Board of Directors has determined that it is in the best
interest of the Corporation and its shareholders to agree to indemnify
Indemnified Party (who is a Director and/or Officer of the Corporation) from and
against certain liabilities for actions taken by him during the performance of
his tasks for the Corporation.
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt, adequacy and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. INDEMNIFICATION. The Corporation hereby agrees to indemnify and hold
---------------
harmless Indemnified Party to the maximum extent possible under all applicable
laws against any and all claims, demands, debts, duties, liabilities, judgments,
fines and amounts paid in settlement and expenses (including attorneys' fees and
expenses) actually and reasonably incurred by Indemnified Party in connection
with the investigation, defense, negotiation and settlement of any such claim or
any threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (including an action by or in the
right of the Corporation) to which Indemnified Party is or becomes a party, or
is threatened to be made a party, by reason of the fact that Indemnified Party
is an officer or a director of the Corporation or any of its subsidiaries.
2. LIMITATIONS ON INDEMNITY. No indemnity pursuant to this Agreement
------------------------
shall be made by the Corporation:
(a) For the amount of such losses for which the Indemnified Party is
indemnified pursuant to any insurance purchased and maintained by the
Corporation; or
(b) In respect to remuneration paid to Indemnified Party if it shall be
determined by a final judgment or other final adjudication that such
remuneration was in violation of law; or
(c) On account of any suit in which judgment is rendered against
Indemnified Party for an accounting of profits made (i) for an
improper personal profit without full and fair disclosure to the
Corporation of all material conflicts of interest and not approved
thereof by a majority of the disinterested members of the Board of
Directors of the Corporation; or (ii) from the purchase or sale by
Indemnified Party of securities of the Corporation pursuant to the
provisions of Section 16(b) of the Securities Exchange Act
<PAGE>
of 1934 and amendments thereto or similar provisions of any federal,
state or local law; or
(d) On account of Indemnified Party's conduct which is finally determined
to have been knowingly fraudulent, deliberately dishonest or willfully
in violation of applicable law for which the corporation suffered
actual financial damages; or
(e) If a final decision by a court having jurisdiction in the matter shall
determine that such indemnification is not lawful.
3. CONTINUATION OF INDEMNITY. All agreements and obligations of the
-------------------------
Corporation contained herein shall continue during the period Indemnified Party
is an officer or director of the Corporation or a subsidiary and thereafter so
long as Indemnified Party shall be subject to any possible claim or threatened,
pending or completed action, suit or proceeding, whether civil, criminal or
investigative, by reason of the fact that Indemnified Party was an officer or a
director of the Corporation or any subsidiary .
4. NOTIFICATION AND DEFENSE OF CLAIM. Within 30 days after receipt by
---------------------------------
Indemnified Party of notice of any claim or any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative, in which Indemnified Party has a right to Indemnification
hereunder, Indemnified Party will notify the Corporation of the commencement
thereof. With respect to any such action, suit or proceeding as to which
Indemnified Party notifies the Corporation of the commencement thereof.
(a) The Corporation will be entitled to participate therein at its own
expense;
and
(b) Except as otherwise provided below, to the extent that it may wish,
the Corporation jointly with any other indemnifying party will be
entitled to assume the defense thereof, with counsel satisfactory to
Indemnified Party. After notice from the Corporation to Indemnified
Party of its election to assume the defense thereof, the Corporation
will not be liable to Indemnified Party under this Agreement for any
legal or other expenses subsequently incurred by Indemnified Party in
connection with the defense thereof other than reasonable costs of
investigation or as otherwise provided below. Indemnified Party shall
have the right to employ counsel in such action, suit or proceeding,
but the fees and expenses of such counsel incurred after notice from
the Corporation of its assumption of the defense thereof shall be at
the expense of Indemnified Party, unless (i) the employment of
counsel by Indemnified Party has been authorized by the Corporation,
(ii) Indemnified Party shall have reasonably concluded that there may
be a conflict of interest between the Corporation and Indemnified
Party in the conduct of the defense of such action, (iii) the
Corporation shall not in fact have employed counsel to assume the
defense of such action, in each of which cases the fees and expenses
of counsel shall be at the expense of the Corporation, or (iv) unless
the Indemnified
2
<PAGE>
Party reasonably and in good faith asserts defenses and theories of
defense not asserted by the Corporation. The Corporation shall not be
entitled to assume the defense of any action, suit or proceeding
brought by or on behalf of the Corporation or as to which Indemnified
Party shall have made the conclusion provided for in (ii) or (iv)
above.
(c) The Corporation shall not be liable to indemnify Indemnified Party
under this Agreement for any amounts paid in settlement of any action
or claim effected without the Corporation's written consent. The
Corporation shall not settle any action in any manner which would
impose any penalty or limitation on Indemnified Party without
Indemnified Party's written consent. Neither the Corporation or
Indemnified Party will unreasonably withhold their consent to any
proposed settlement.
5. REPAYMENT OF EXPENSES. Indemnified Party agrees that Indemnified
---------------------
Party will reimburse the Corporation for all reasonable expenses paid by the
Corporation in defending any civil or criminal action, suit or proceeding
against Indemnified Party in the event and only to the extent that Indemnified
Party is finally determined that Indemnified Party is not entitled to be
indemnified by the Corporation for such expenses under the Corporation's charter
or bylaws, this Agreement or under applicable law.
6. ENFORCEMENT.
-----------
(a) The Corporation expressly confirms and agrees that it has entered into
this Agreement and assumed the obligations imposed on the Corporation
hereby in order to induce Indemnified Party to serve as an officer
and/or director of the Corporation or any subsidiary thereof, and
acknowledges that Indemnified Party is relying upon this Agreement as
part of the consideration for so acting.
(b) In the event Indemnified Party is required to bring any action to
enforce rights or to collect moneys due under this Agreement and is
successful in such action, the Corporation shall reimburse Indemnified
Party for all of Indemnified Party's reasonable attorneys' and other
fees and expenses in bringing and pursuing such action.
7. SEVERABILITY. Each of the provisions of this Agreement is a separate
and distinct agreement and independent of the others, so that if any provision
hereof shall be held to be invalid or unenforceable for any reason, such
invalidity or unenforceability shall not affect the validity or enforceability
of the other provisions hereof.
8. GOVERNMENT LAW; BINDING EFFECT; AMENDMENT AND TERMINATION.
---------------------------------------------------------
(a) This Agreement shall be interpreted and enforced in accordance with
the laws of the State of Arizona.
(b) This Agreement shall be binding upon Indemnified Party and upon the
Corporation, its successors and assigns, and shall inure to the
benefit of
3
<PAGE>
Indemnified Party, his heirs, personal representatives and assigns and
to the benefit of the Corporation, its successors and assigns.
(c) No amendment, modification, termination or change of this Agreement
shall be effective unless it is signed by both parties hereto.
9. ADDITIONAL RIGHTS. This Agreement is in addition to, and not in lieu
-----------------
of, any other right to indemnification under the Corporation's corporate
charter, bylaws, insurance contracts or otherwise at law or in equity.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and
as of the day and year first above written.
MEADOW VALLEY CORPORATION AND
MEADOW VALLEY CONTRACTORS, INC.
By: /s/ Bradley E. Larson
-----------------------------------------------
Bradley E. Larson, President and Chief Executive
Officer
Indemnified Party:
/s/ Alan A. Terril
--------------------------------------------------
Alan A. Terril
4
<PAGE>
Exhibit 10.74
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is entered into as of the 1 day of October 1997,
by and between Meadow Valley Corporation, a Nevada corporation (the "Employer"),
and Paul R. Lewis (the "Employee").
The Employer hereby employs the Employee on a full-time basis, and the
Employee hereby accepts such full-time employment on the terms condition
hereinafter set forth.
1. EMPLOYMENT. Employee is employed as the Chief Operating Officer for
----------
the Employer. Employee shall perform all duties as outlined herein and as may be
assigned by the Employer and shall devote full time, attention and loyalty to
the affairs of the Employer. The duties of the Employee shall specifically be:
A) Oversee all operating entities of the Employer. Reporting to Ron
Lewis will be each Area Manager for the Nevada, Arizona, AKR and Utah
Areas, and the Presidents of Prestressed Products Incorporated and Ready
Mix, Inc., and the Manager for the Rock & Sand Operations.
B) Assist operating units in decision-making relative to work
bidding, margins bid, and preparation and submission of estimates.
C) Assist operating units to maximize profitability by active
participation in project planning, problem-solving, partnering, and
claims/litigation preparation.
D) Assist and oversee operating budgets, capital expenditure budgets
and approve project specific budgets for use in the Company's Budget Bonus
Incentive Program.
E) Oversee and delegate as necessary administration of the Company's
equipment and other resources. The COO is responsible for decision-making
regarding the types of equipment acquired in capital purchases and leases.
F) Assist in selection and evaluation of merger and/or acquisition
opportunities of the Company.
G) Assist in formulating and executing strategic plans.
H) Any other area specifically assigned by the Chief Executive
Officer or the Board of Directors.
2. TERM. Subject to the provisions of termination provided in
----
paragraph 12, the initial term of this Agreement shall commence on October 1,
1997 and terminate on September 30, 2002. This Agreement may be extended by the
mutual written agreement of the Employee and the Employer.
3. COMPENSATION. Employee shall receive a base salary of One Hundred Ten
------------
Thousand Dollars ($110,000.00) per year, payable in accordance with the regular
payroll practices of Employer, and subject to applicable deductions of
withholding taxes and other customary employment taxes. The Chief Executive
Officer of Employer shall review Employee's salary at a minimum annually and may
adjust Employee's salary
<PAGE>
of 1934 and amendments thereto or similar provisions of any federal,
state or local law; or
(d) On account of Indemnified Party's conduct which is finally determined
to have been knowingly fraudulent, deliberately dishonest or willfully
in violation of applicable law for which the corporation suffered
actual financial damages; or
(e) If a final decision by a court having jurisdiction in the matter shall
determine that such indemnification is not lawful.
3. CONTINUATION OF INDEMNITY. All agreements and obligations of the
-------------------------
Corporation contained herein shall continue during the period Indemnified Party
is an officer or director of the Corporation or a subsidiary and thereafter so
long as Indemnified Party shall be subject to any possible claim or threatened,
pending or completed action, suit or proceeding, whether civil, criminal or
investigate, by reason of the fact that Indemnified party was an officer or a
director of the Corporation or any subsidiary.
4. NOTIFICATION AND DEFENSE OF CLAIM. Within 30 days after receipt by
---------------------------------
Indemnified Party of notice of any claim or any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative, in which Indemnification Party has a right to Indemnification
hereunder, Indemnified Party will notify the Corporation of the commencement
thereof. With respect to any such action, suit or proceeding as to which
Indemnified Party notifies the Corporation of the commencement thereof:
(a) The Corporation will be entitled to participate therein at its own
expense; and
(b) Except as otherwise provided below, to the extent that it may wish,
the Corporation jointly with any other indemnifying party will be
entitled to assume the defense thereof, with counsel satisfactory to
Indemnified Party. After notice from the Corporation to Indemnified
Party of its election to assume the defense thereof, the Corporation
will not be liable to Indemnified Party under this Agreement for any
legal or other expenses subsequently incurred by Indemnified Party in
connection with the defense thereof other than reasonable costs of
investigation or as otherwise provided below. Indemnified Party shall
have the right to employ counsel in such action, suit or proceeding,
but the fees and expenses of such counsel incurred after notice from
the Corporation of its assumption of the defense thereof shall be at
the expense of Indemnified Party, unless (i) the employment of counsel
by Indemnified Party has been authorized by the Corporation, (ii)
Indemnified Party shall have reasonably concluded that there may be a
conflict of interest between the Corporation and Indemnified Party in
the conduct of the defense of such action, (iii) the Corporation shall
not in fact have employed counsel to assume the defense of such
action, in each of which cases the fees and expenses of counsel shall
be at the expense of the Corporation, or (iv) unless the Indemnified
2
<PAGE>
Party reasonably and in good faith asserts defenses and theories of
defense not asserted by the Corporation. The Corporation shall not be
entitled to assume the defense of any action, suit or proceeding
brought by or on behalf of the Corporation or as to which Indemnified
Party shall have made the conclusion provided for in (ii) or (iv)
above.
(c) The Corporation shall not be liable to indemnify Indemnified Party
under this Agreement for any amounts paid in settlement of any action
or claim effected without the Corporation's written consent. The
Corporation shall not settle any action or claim in any manner which
would impose any penalty or limitation on Indemnified Party without
Indemnified Party's written consent. Neither the Corporation or
Indemnified Party will unreasonably withhold their consent to any
proposed settlement.
5. REPAYMENT OF EXPENSES. Indemnified Party agrees that Indemnified Party
---------------------
will reimburse the Corporation for all reasonable expenses paid by the
Corporation in defending any civil or criminal action, suit or proceeding
against Indemnified Party in the event and only to the extent that Indemnified
Party is finally determined that Indemnified Party is not entitled to be
indemnified by the Corporation for such expenses under the Corporation's charter
or bylaws, this Agreement or under applicable law.
6. ENFORCEMENT.
-----------
(a) The Corporation expressly confirms and agrees that it has entered into
this Agreement and assumed the obligations imposed on the Corporation
hereby in order to induce Indemnified Party to serve as an officer
and/or director of the Corporation or any subsidiary thereof, and
acknowledges that Indemnified Party is relying upon this Agreement as
part of the consideration for so acting.
(b) In the event Indemnified Party is requiring to bring any action to
enforce rights on to collect moneys due under this Agreement and is
successful in such action, the Corporation shall reimburse Indemnified
Party for all of Indemnified Party's reasonable attorneys' and other
fees and expenses in bringing and pursuing such action.
7. SEVERABILITY. Each of the provisions of this Agreement in a separate
------------
and distinct agreement and independent of the others, so that if any provision
hereof shall be held to be invalid or unenforceable for any reason, such
invalidity or unenforceability shall not affect the validity or enforceability
of the other provisions hereof.
8. GOVERNING LAW: BINDING EFFECT: AMENDMENT AND TERMINATION.
--------------------------------------------------------
(a) This Agreement shall be interpreted and enforced in accordance with
the laws of the State of Arizona.
(b) This Agreement shall be binding upon Indemnified Party and upon the
Corporation, its successors and assigns, and shall inure to the
benefit of
3
<PAGE>
Indemnified Party, his heirs, personal representatives and assigns and
to the benefit of the Corporation, its successors and assigns.
(c) No amendment, modification, termination or change of this Agreement
shall be effective unless it is signed by both parties hereto.
9. ADDITIONAL RIGHTS. This Agreement is in addition to, and not in lieu
-----------------
of, any other right to indemnification under the Corporation's corporate
charter, bylaws, insurance contracts or otherwise at law or in equity.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and
as of the day and year first above written.
MEADOW VALLEY CORPORATION AND
MEADOW VALLEY CONTRACTORS, INC.
By: /s/ Bradley E. Larson
-----------------------------------------------
Bradley E. Larson, President and Chief Executive
Officer
Indemnified Party:
/s/ Paul R. Lewis
--------------------------------------------------
Paul R. Lewis
4
<PAGE>
Agreement by Employer or (ii) failure of Employer to pay any amount owed
Employee hereunder at the time and in the amount due or (iii) failure of
Employer to follow applicable law, especially with respect to SEC filings
and compliance over the objection of Employee or contrary to the reasonable
advice of Employee or (iv) egregiously improper conduct with respect to
dealing with Employee or in a manner which brings discredit to Employee.
13. CONFIDENTIALITY. Employee agrees not to disclose any confidential,
---------------
proprietary competitively sensitive information to persons who are not
employees, directors, lenders, bonding agents, insurance companies or advisors
of the Employer, except as required by law, without prior consent of the
Employer, provided however, any disclosure involving this paragraph shall not
result in a breach of this Agreement unless the disclosure has a materially
adverse effect on the Employer.
14. INDEMNIFICATION. Employer and Meadow Valley Contractors, Inc. shall
---------------
provide Employee with an Officer Indemnification Agreement in the form attached
hereto.
15. NOTICES. All notices, demands, and communications given under this
-------
Agreement ("Notice") shall be in writing and delivered personally or sent by
registered or certified mail, return receipt requested, in the United States
mail, postage prepaid, addressed as follows:
If to Employer:
Meadow Valley Corporation
P.O. Box 60726
Phoenix, AZ 85082-0726
If to Employee:
Paul R. Lewis
P.O. Box 57
Moapa, NV 89025
or at such other address as a party may from time to time designate by Notice
hereunder. Notice shall be effective upon delivery in person, or if mailed, at
midnight on the third business day after the date of mailing.
16. ASSIGNMENT OF AGREEMENT. Neither party may assign or otherwise
-----------------------
transfer this Agreement or any of its rights or obligations hereunder without
the prior written consent to such assignment or transfer by the other party
hereto; and all the provisions of this Agreement shall be binding upon the
respective employees, successors, heirs and assigns of the parties; provided,
however, the benefits payable to Employee hereunder in the event of disability
or death or incapacity are payable to Employee's spouse or personal
representative.
5
<PAGE>
17. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS. This Agreement
-----------------------------------------------------
and the representations, warranties, covenants and other agreements (however
characterized or described) by both parties and contained herein or made
pursuant to the provisions hereof shall survive the execution and delivery of
this Agreement.
18. FURTHER INSTRUMENTS. The parties shall execute and deliver any and
-------------------
all such other instruments in reasonable mutually acceptable form and substance
and shall take any and all such other actions as may be reasonably necessary to
carry the intent of the Agreement into full force and effect.
19. SEVERABILITY. If any provision of this Agreement shall be held,
------------
declared or pronounced void, voidable, invalid, unenforceable or inoperative for
any reason by any court of competent jurisdiction, governmental authority or
otherwise, such holding, declaration or pronouncement shall not affect adversely
any other provision of this Agreement, which shall otherwise remain in full
force and effect and be enforced in accordance with its terms, and the effect of
such holding, declaration or pronouncement shall be limited to the territory of
jurisdiction in which made.
20. WAIVER. All the rights and remedies of either party under this
------
Agreement are cumulative and not exclusive of any other rights and remedies
provided by law. No delay or failure on the part of either party in the exercise
of any right or remedy arising from a breach of this Agreement shall operate as
a waiver of any subsequent right or remedy arising from a subsequent breach of
this Agreement. The consent of any party where required hereunder to any act or
occurrence shall not be deemed to be a consent to any other act or occurrence.
21. GENERAL PROVISIONS. This Agreement shall be construed and enforced in
------------------
accordance with, and governed by, the laws of the state of Arizona. Except as
otherwise expressly stated herein, time is of the essence in performing under
this Agreement. This Agreement embodies the entire agreement and understanding
between the parties and supersedes all prior agreements and understandings
relating to the subject matter of this Agreement as it relates to the parties'
duties and obligations from and after April 1, 1997, and this Agreement may not
be modified or amended or any term or provision hereof waived or discharged
except in writing signed by the party against whom such amendment, modification,
waiver or discharge is sought to be enforced. The headings of this Agreement
are for convenience in reference only and shall not limit or otherwise affect
the meaning thereof. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original but all of which taken
together shall constitute one and the same instrument.
22. SPECIAL RIGHT OF EMPLOYEE UNDER CERTAIN CIRCUMSTANCES. During the
-----------------------------------------------------
term of this Agreement, if (i) Employer is involved in a merger, consolidation
or other business combination in which Employer is not the surviving and
controlling entity; or (ii) all or substantially all the assets of Employer or
its
6
<PAGE>
principal subsidiary are sold; or (iii) in the event Employee is required to
relocate outside the Moapa, Nevada area in a manner not mutually acceptable to
Employee and Employer, then Employee shall have the following rights:
A) To terminate this Agreement with 30 days prior notice, in which
event Employer shall pay Employee as if there were a termination without
cause by the Employer; and
B) All options granted shall, to the extent not specifically
prohibited by the stock option plan then in effect, vest immediately and be
exercisable within one year of the occurring of one of the events set forth
in (i), (ii) or (iii) above.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year
first above written.
Meadow Valley Corporation
/s/ Paul R. Lewis By /s/ Bradley E. Larson
- ----------------------------- ---------------------------------
Employee President/CEO
7
<PAGE>
MEADOW VALLEY CORPORATION AND
MEADOW VALLEY CONTRACTORS, INC.
OFFICER/DIRECTOR INDEMNIFICATION AGREEMENT
------------------------------------------
THIS AGREEMENT ("Agreement") is entered into and effective this __ day of
_______, 19__, by and between Meadow Valley Corporation and Meadow Valley
Contractors, Inc., Nevada corporations ("Corporation"), and Paul R. Lewis
("Indemnified Party").
WHEREAS, the Board of Directors has determined that it is in the best
interest of the Corporation and its shareholders to agree to indemnify
Indemnified Party (who is a Director and/or Officer of the Corporation) from and
against certain liabilities for actions taken by him during the performance of
his tasks for the Corporation.
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt, adequacy and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. INDEMNIFICATION. The Corporation hereby agrees to indemnify and hold
---------------
harmless Indemnified Party to the maximum extent possible under all applicable
laws against any and all claims, demands, debts, duties, liabilities, judgments,
fines and amounts paid in settlement and expenses (including attorneys' fees and
expenses) actually and reasonably incurred by Indemnified Party in connection
with the investigation, defense, negotiation and settlement of any such claim or
any threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (including an action by or in the
right of the Corporation) to which Indemnified Party is or becomes a party, or
is threatened to be made a party, by reason of the fact that Indemnified Party
is an officer or a director of the Corporation or any of its subsidiaries.
2. LIMITATIONS ON INDEMNITY. No indemnity pursuant to this Agreement
------------------------
shall be made by the Corporation:
(a) For the amount of such losses for which the Indemnified Party is
indemnified pursuant to any insurance purchased and maintained by the
Corporation; or
(b) In respect to remuneration paid to Indemnified Party if it shall be
determined by a final judgment or other final adjudication that such
remuneration was in violation of law; or
(c) On account of any suit in which judgment is rendered against
Indemnified Party for an accounting of profits made (i) for an
improper personal profit without full and fair disclosure to the
Corporation of all material conflicts of interest and not approved
thereof by a majority of the disinterested members of the Board of
Directors of the Corporation; or (ii) from the purchase or sale by
Indemnified Party of securities of the Corporation pursuant to the
provisions of Section 16(b) of the Securities Exchange Act
<PAGE>
upward to recognize improvement, achievement or expansion of Employee's
responsibilities subject to approval of the Board Compensation Committee.
Employee shall participate as a member of senior management in cash
incentive plans as currently existing or as amended or adopted in the future by
the Compensation Committee of Employer's Board of Directors. Cash bonus plans
are subject to annual review and/or change as recommended by the Compensation
Committee and approved by the Board of Directors.
4. OPTIONS TO ACQUIRE COMMON STOCK. Employee is eligible to participate
-------------------------------
in the Meadow Valley Corporation 1994 Stock Option Plan. Future grants of stock
options shall be subject to the discretion of Meadow Valley Corporation's board
of directors.
5. EMPLOYEE BENEFITS. Employer shall provide to Employee, and to the
-----------------
Employee's dependents, a comprehensive major medical, health, and dental
insurance program comparable to the programs normally provided by other
employers in the same industry and marketplace, and the Employer shall pay the
cost of the Employee's portion of the premium. Should, at any time, the Employee
opt to maintain a personal major medical and health insurance policy for
himself and for his dependents and not participate in the Employer's group plan,
then Employer shall reimburse Employee the lesser of the amount Employee pays
for said personal policy, as evidenced by adequate documentation, or what
Employer would otherwise be paying were Employee participating in the Employer's
group plan. Should the Employee opt to maintain his own coverage, neither he nor
his dependents shall be precluded from later participating in the Employer's
group plan so long as they otherwise qualify for enrollment.
At Employer's cost, Employer will maintain a life insurance policy covering
Employee, with at least $250,000 of death benefits being payable, in a manner
that is free of income tax, to Employee's estate or other beneficiaries
designated by Employee.
Employer agrees to provide Employee with an automobile for business-related
use. In addition to the cost of the vehicle itself, Employer shall pay, directly
or by reimbursement to Employee, for all maintenance, fuel, repairs, insurance,
operating and other costs incidental thereto.
Employer shall pay for, or reimburse Employee for, dues for his membership
in industry related associations perceived as beneficial to Employer and as
approved by the Chief Executive Officer.
So long as it is within the guidelines of the respective plan, Employee
shall be given the opportunity to participate in Employer's 401(k) and any other
plans made available to other members of executive management.
Employee shall be entitled to receive all other employee benefits for
senior management personnel upon the terms and conditions then in effect.
6. MOVING EXPENSES AND SUBSISTENCE. In the event the Employer requires
-------------------------------
the Employee to relocate, the Employer shall pay for all moving costs of
reasonable and normal household effects, including up to six months storage of
such household effects while Employee obtains a permanent residence in the
relocation area.
2
<PAGE>
Employee shall obtain a minimum of two moving and storage quotes from reputable
movers and Employer shall pay the most competitive rate.
Employer shall provide Employee a subsistence allowance of Two Thousand
Dollars ($2,000.00) per month for the lesser of nine months from the date of
reassignment in a new location or until such time as the relocation of Employee
and his/her spouse to the relocation area is complete. In addition, costs for
one round-trip airline ticket per week between the Employee's previous location
and the relocation area will be reimbursed by Employer to Employee during the
same nine-month period, or less if relocation is completed earlier. Such tickets
may be used either by Employee or by his/her spouse.
7. HOLIDAYS AND VACATION.
---------------------
A) Employee shall be paid for the following seven (7) holidays: New
Year's Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
the day after Thanksgiving, and Christmas Day and all other holidays for
Employees of the Company as approved by the Chief Executive Officer or
Board of Directors.
B) Employee is entitled to four weeks vacation during the first year
of employment and for each year thereafter. Unused vacation in any given
year shall accrue to following years up to a maximum of eight weeks in any
one year.
8. RESPONSIBILITIES OF EMPLOYEE. The Employee shall devote such
----------------------------
reasonable time as is necessary or is deemed reasonably necessary by the
Employer to carry out all required duties and will devote full time to the
Employer during normal business hours. The Employee shall at all times
faithfully, with diligence and to the Employee's best good faith ability,
experience and talents, perform all the duties that may be required pursuant to
the express terms hereof to the reasonable satisfaction of the Employer, in
accordance with customary professional standards.
9. WORKING FACILITIES. The Employee shall be furnished with all
------------------
facilities and services suitable to Employee's position and adequate for the
performance of Employee's duties.
10. EXPENSES. The Employee is authorized to incur reasonable expenses for
--------
promoting business of the Employer, including expenses for entertainment, travel
and similar items. The Employer shall reimburse the Employee for all such
expenses on the presentation by the Employee of itemized and adequately
documented accounts of such expenditures.
11. DISABILITY. If unable to perform duties under the terms of this
----------
Agreement by reason of illness or incapacity for a period of four weeks,
Employee shall, commencing at the end of such four week period, be entitled to
receive Employee's compensation hereunder for a period of up to and including a
maximum of one year or until he is no longer disabled, whichever occurs first.
After one year of disability at full salary, the Employee, or his designated
beneficiary, shall be provided with a disability insurance policy, if available,
at no cost to Employee. The disability income policy would provide
3
<PAGE>
for monthly income benefits at the rate of sixty percent (60%) of the Employee's
base salary at the time the disability occurred. The Company will attempt to
procure a disability income policy that would provide monthly benefits until the
Employee reaches 65 years of age or is no longer disabled whichever occurs
first. If such a policy is unavailable, the Company will attempt to provide the
best policy available. If no policy is available, no other disability income
benefits will be provided.
12. TERMINATION. This Employment Agreement may be terminated under the
-----------
following circumstances.
A) WITHOUT CAUSE. Employer may terminate this Agreement at any time
-------------
upon thirty (30) days written notice to Employee, but Employer shall be
obligated to pay to Employee compensation in a lump sum for the balance of
the term of this Agreement within 30 days of termination, unless Employee
agrees to other payment terms.
B) VOLUNTARY TERMINATION BY EMPLOYEE WITHOUT CAUSE. Employee may
-----------------------------------------------
terminate this Agreement at any time upon thirty (30) days written notice
to Employer and Employer shall be obligated, in that event, to pay Employee
compensation up to the date of the termination only. All accrued but unpaid
compensation and Employee benefits shall be paid in cash within 30 days of
termination, unless Employee agrees to other payment terms.
C) TERMINATION BY EMPLOYER FOR REASONABLE CAUSE. The Employer may
--------------------------------------------
terminate this Agreement for reasonable cause upon the unanimous vote of
the Board of Directors and by thirty (30) days written notice to the
Employee and Employer shall be obligated, in that event, to pay Employee
compensation up to the date of termination only. For purposes hereof,
"cause" shall be defined as meaning (i) such conduct by the Employee which
constitutes material breach of this Agreement which is not cured within
ninety (90) days of written notice to the Employee of said alleged breach
or (ii) a material failure to competently perform Employee's duties as
stated in paragraph 1 in accordance with applicable professional standards
as stated in paragraphs 1 and 8 hereof provided that Employer has
previously given Employee written notice and a reasonable opportunity to
remedy such failure and such failure has a materially adverse effect on the
business or financial condition of Employer or (iii) material breach of
Employee's fiduciary duty and such breach has a material adverse effect on
the business or financial condition of Employer to (iv) egregiously
improper or illegal conduct of the Employee which, based upon a unanimous
good faith determination of the Board of Directors of the Employer, has a
material adverse affect on Employer.
D) TERMINATION BY EMPLOYEE FOR REASONABLE CAUSE. Employee may terminate
--------------------------------------------
this Agreement for cause. In such event, Employer shall be obligated to pay
Employee compensation in lump sum for the balance of the term of this Agreement
within 30 days of termination or as Employee shall agree, plus damages suffered
and expenses incurred by reason thereof. For this purpose "cause" shall mean (i)
a material breach of this
4
<PAGE>
EXHIBIT 10.75
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is entered into as of the 8th day of January
1998, by and between Meadow Valley Corporation, a Nevada corporation (the
"Employer"), and Bradley E. Larson (the "Employee").
The Employer hereby employs the Employee on a full-time basis, and the
Employee hereby accepts such full-time employment on the terms and conditions
hereinafter set forth.
1. EMPLOYMENT. Employee is employed as the President and Chief
----------
Executive Officer for the Employer. Employee shall perform all duties as
outlined herein and as may be assigned by the Employer and shall devote full
time, attention and loyalty to the affairs of the Employer. The duties of the
Employee shall specifically be:
A) To serve as a member of the Board of Directors, report directly
to the Board, communicate with the board regarding current operational and
financial status of Employer and strategic plans.
B) To present to the board, for board approval, annual operating
plans,capital improvement programs, budgets and annual updates of strategic
plans.
C) To assist the Chief Operating Officer in organizing operations
personnel to maximize productivity and synergy between various area
managers. Delegate responsibilities and oversee activities in the ares of
finance/accounting, operations, estimating/marketing, safety and human
resources.
D) To active represent the Employer in industry organizations where
the membership is deemed to be beneficial to the Employer; and serve as
board member and/or officer in said organizations when elected to do so.
E) To seek out, and present to the board, and opportunities for
acquisition and/or investment for growth of the Employer, and to negotiate
or assist in the negotiations of acquisitions or investment expenditures.
F) To represent the Employer in contract negotiations with owners of
work subcontractors and suppliers.
G) To establish, foster and maintain relationships with important
vendors and suppliers of strategic resources.
H) Any other area specifically assigned by the Board of Directors.
2. TERM. Subject to the provisions of termination provided in paragraph
----
12, the initial term of this Agreement shall commence on day and year first
written above and terminate on December 31, 1999. This Agreement may be extended
by the mutual written agreement of the Employee and the Employer.
3. COMPENSATION. Employee shall receive a base salary of One Hundred
------------
twenty Thousand Dollars ($120,000.00) per year, payable in accordance with the
regular payroll practices of Employer, and subject to applicable deductions of
withholding taxes and other customary employment taxes. The Board Compensation
Committee of Employer shall review Employee's salary at a minimum annually and
may
<PAGE>
adjust Employee's salary upward to recognize improvement, achievement or
expansion of Employee's responsibilities.
Employee shall participate as a member of senior management in cash
incentive plans as currently existing or as amended or adopted in the future by
the Compensation Committee of Employer's Board of Directors. Cash bonus plans
are subject to annual review and/or change as recommended by the Compensation
Committee and approved by the Board of Directors.
4. OPTIONS TO ACQUIRE COMMON STOCK. Employee is eligible to participate
-------------------------------
in the Meadow Valley Corporation 1994 Stock Option Plan. Future grants of stock
options shall be subject to the discretion of Meadow Valley Corporation's board
of directors.
5. EMPLOYEE BENEFITS. Employer shall provide to Employee, and to the
-----------------
Employee's dependents, a comprehensive major medical, health, and dental
insurance program comparable to the programs normally provided by other
employers in the same industry and marketplace, and the Employer shall pay the
cost of the Employee's portion of the premium. Should, at any time, the Employee
opt to maintain a personal major medical and health insurance policy for
himself and for his dependents and not participate in the Employer's group plan,
then Employer shall reimburse Employee the lesser of the amount Employee pays
for said personal policy, as evidenced by adequate documentation, or what
Employer would otherwise be paying were Employee participating in the Employer's
group plan. Should the Employee opt to maintain his own coverage, neither he nor
his dependents shall be precluded from later participating in the Employer's
group plan so long as they otherwise qualify for enrollment.
At Employer's cost, Employer will maintain a life insurance policy covering
Employee, with at least $250,000 of death benefits being payable, in a manner
that is free of income tax, to Employee's estate or other beneficiaries
designated by Employee.
Employer agrees to provide Employee with an automobile for business-related
use. In addition to the cost of the vehicle itself, Employer shall pay, directly
or by reimbursement to Employee, for all maintenance, fuel, repairs, insurance,
operating and other costs incidental thereto.
Employer shall pay for, or reimburse Employee for, dues for his membership
in industry related associations perceived as beneficial to Employer and as
approved by the Employer's Executive Committee.
So long as it is within the guidelines of the respective plan, Employee
shall be given the opportunity to participate in Employer's 401(k) and any other
plans made available to other members of executive management.
Employee shall be entitled to receive all other employee benefits for
senior management personnel upon the terms and conditions then in effect.
6. MOVING EXPENSES AND SUBSISTENCE. In the event the Employer requires
-------------------------------
the Employee to relocate, the Employer shall pay for all moving costs of
reasonable and normal household effects, including up to six months storage of
such household effects while Employee obtains a permanent residence in the
relocation area.
2
<PAGE>
Employee shall obtain a minimum of two moving and storage quotes from reputable
movers and Employer shall pay the most competitive rate.
Employer shall provide Employee a subsistence allowance of Two Thousand
Dollars ($2,000.00) per month for the lesser of nine months from the date of
reassignment in a new location or until such time as the relocation of Employee
and his/her spouse to the relocation area is complete. In addition, costs for
one round-trip airline ticket per week between the Employee's previous location
and the relocation area will be reimbursed by Employer to Employee during the
same nine-month period, or less if relocation is completed earlier. Such tickets
may be used either by Employee or by his/her spouse.
7. HOLIDAYS AND VACATION.
---------------------
A) Employee shall be paid for the following seven (7) holidays: New
Year's Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
the day after Thanksgiving, and Christmas Day and all other holidays for
Employees of the Company as approved by the Chief Executive Officer or
Board of Directors.
B) Employee is entitled to four weeks vacation during the first year
of employment and for each year thereafter. Unused vacation in any given
year shall accrue to following years up to a maximum of eight weeks in any
one year.
8. RESPONSIBILITIES OF EMPLOYEE. The Employee shall devote such
----------------------------
reasonable time as is necessary or is deemed reasonably necessary by the
Employer to carry out all required duties and will devote full time to the
Employer during normal business hours. The Employee shall at all times
faithfully, with diligence and to the Employee's best good faith ability,
experience and talents, perform all the duties that may be required pursuant to
the express terms hereof to the reasonable satisfaction of the Employer, in
accordance with customary professional standards.
9. WORKING FACILITIES. The Employee shall be furnished with all
------------------
facilities and services suitable to Employee's position and adequate for the
performance of Employee's duties.
10. EXPENSES. The Employee is authorized to incur reasonable expenses for
--------
promoting business of the Employer, including expenses for entertainment, travel
and similar items. The Employer shall reimburse the Employee for all such
expenses on the presentation by the Employee of itemized and adequately
documented accounts of such expenditures.
11. DISABILITY. If unable to perform duties under the terms of this
----------
Agreement by reason of illness or incapacity for a period of four weeks,
Employee shall, commencing at the end of such four week period, be entitled to
receive Employee's compensation hereunder for a period of up to and including a
maximum of one year or until he is no longer disabled, whichever occurs first.
After on year of disability at full salary, the Employee, or his designated
beneficiary, shall be provided with a disability insurance policy, if available,
at no cost to Employee. The disability income policy would provide
3
<PAGE>
for monthly income benefits at the rate of sixty percent (60%) of the Employee's
base salary at the time the disability occurred. The Company will attempt to
procure a disability income policy that would provide monthly benefits until the
Employee reaches 65 years of age or is no longer disabled whichever occurs
first. If such a policy is unavailable, the Company will attempt to provide the
best policy available. If no policy is available, no other disability income
benefits will be provided.
12. TERMINATION. This Employment Agreement may be terminated under the
-----------
following circumstances:
A) WITHOUT CAUSE. Employer may terminate this Agreement at any time
-------------
upon thirty (30) days written notice to Employee, but Employer shall be
obligated to pay to Employee compensation in a lump sum for the balance of
the term of this Agreement within 30 days of termination, unless Employee
agrees to other payment terms.
B) VOLUNTARY TERMINATION BY EMPLOYEE WITHOUT CAUSE. Employee may
-----------------------------------------------
terminate this Agreement at any time upon thirty (30) days written notice
to Employer and Employer shall be obligated, in that event, to pay Employee
compensation up to the date of the termination only. All accrued but unpaid
compensation and Employee benefits shall be paid in cash within 30 days of
termination, unless Employee agrees to other payment terms.
C) TERMINATION BY EMPLOYER FOR REASONABLE CAUSE. The Employer may
--------------------------------------------
terminate this Agreement for reasonable cause upon the unanimous vote of
the Board of Directors and by thirty (30) days written notice to the
Employee and Employer shall be obligated, in that event, to pay Employee
compensation up to the date of termination only. For purposes hereof,
"cause" shall be defined as meaning (i) such conduct by the Employee which
constitutes material breach of this Agreement which is not cured within
ninety (90) days of written notice to the Employee of said alleged breach
or (ii) a material failure to competently perform Employee's duties as
stated in paragraph 1 in accordance with applicable professional standards
as stated in paragraphs 1 and 8 hereof provided that Employer has
previously given Employee written notice and a reasonable opportunity to
remedy such failure and such failure has a materially adverse effect on the
business or financial condition of Employer or (iii) material breach of
Employee's fiduciary duty and such breach has a material adverse effect on
the business or financial condition of Employer or (iv) egregiously
improper or illegal conduct of the Employee which, based upon a unanimous
good faith determination of the Board of Directors of the Employer, has a
material adverse affect on Employer.
D) TERMINATION BY EMPLOYEE FOR REASONABLE CAUSE. Employee may
--------------------------------------------
terminate this Agreement for cause. In such event, Employer shall be
obligated to pay Employee compensation in lump sum for the balance of the
term of this Agreement within 30 days of termination or as Employee shall
agree, plus damages suffered and expenses incurred by reason thereof. For
this purpose "cause" shall mean (i) a material breach of this
4
<PAGE>
Agreement by Employer or (ii) failure of Employer to pay any amount owed
Employee hereunder at the time and in the amount due or (iii) failure of
Employer to follow applicable law, especially with respect to SEC filings
and compliance over the objection of Employee or contrary to the reasonable
advice of Employee or (iv) egregiously improper conduct with respect to
dealing with Employee or in a manner which brings discredit to Employee.
13. CONFIDENTIALITY. Employee agrees not to disclose any confidential,
---------------
proprietary competitively sensitive information to persons who are not
employees, directors, lenders, bonding agents, insurance companies or advisors
of the Employer, except as required by law, without prior consent of the
Employer; provided however, any disclosure involving this paragraph shall not
result in a breach of this Agreement unless the disclosure has a materially
adverse effect on the Employer.
14. INDEMNIFICATION. Employer and Meadow Valley Contractors, Inc. shall
---------------
provide Employee with an Officer Indemnification Agreement in the form attached
hereto.
15. NOTICES. All notices, demands, and communications given under this
-------
Agreement ("Notice") shall be in writing and delivered personally or sent by
registered or certified mail, return receipt requested, in the United States
mail, postage prepaid, addressed as follows:
If to Employer:
Meadow Valley Corporation
P.O. Box 60726
Phoenix, AZ 85082-0726
If to Employee:
Bradley E. Larson
671 E. Encinas Ave.
Gilbert, AZ 85234
or at such other address as a party may from time to time designate by Notice
hereunder. Notice shall be effective upon delivery in person, or if mailed, at
midnight on the third business day after the date of mailing.
16. ASSIGNMENT OF AGREEMENT. Neither party may assign or otherwise
-----------------------
transfer this Agreement or any of its rights or obligations hereunder without
the prior written consent to such assignment or transfer by the other party
hereto; and all the provisions of this Agreement shall be binding upon the
respective employees, successors, heirs and assigns of the parties; provided,
however, the benefits payable to Employee hereunder in the event of disability
or death or incapacity are payable to Employee's spouse or personal
representative.
5
<PAGE>
17. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS. This Agreement
-----------------------------------------------------
and the representations, warranties, covenants and other agreements (however
characterized or described) by both parties and contained herein or made
pursuant to the provisions hereof shall survive the execution and delivery of
this Agreement.
18. FURTHER INSTRUMENTS. The parties shall execute and deliver any and all
-------------------
such other instruments in reasonable mutually acceptable form and substance and
shall take any and all such other actions as may be reasonably necessary to
carry the intent of the Agreement into full force and effect.
19. SEVERABILITY. If any provision of this Agreement shall be held,
------------
declared or pronounced void, voidable, invalid, unenforceable or inoperative for
any reason by any court of competent jurisdiction, governmental authority or
otherwise, such holding, declaration or pronouncement shall not affect adversely
any other provision of this Agreement, which shall otherwise remain in full
force and effect and be enforced in accordance with its terms, and the effect of
such holding, declaration or pronouncement shall be limited to the territory of
jurisdiction in which made.
20. WAIVER. All the rights and remedies of either party under this
------
Agreement are cumulative and not exclusive of any other rights and remedies
provided by law. No delay or failure on the part of either party in the exercise
of any right or remedy arising from a breach of this Agreement shall operate as
a waiver of any subsequent right or remedy arising from a subsequent breach of
this Agreement. The consent of any party where required hereunder to any act or
occurrence shall not be deemed to be a consent to any other act or occurrence.
21. GENERAL PROVISIONS. This Agreement shall be construed and enforced in
-------------------
accordance with, and governed by, the laws of the state of Arizona. Except as
otherwise expressly stated herein, time is of the essence in performing under
this Agreement. This Agreement embodies the entire agreement and understanding
between the parties and supersedes all prior agreements and understandings
relating to the subject matter of this Agreement as it relates to the parties'
duties and obligations from and after April 1, 1997, and this Agreement may not
be modified or amended or any term or provision hereof waived or discharged
except in writing signed by the party against whom such amendment, modification,
waiver or discharge is sought to be enforced. The headings of this Agreement are
for convenience in reference only and shall not limit or otherwise affect the
meaning thereof. This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original but all of which taken together shall
constitute one and the same instrument.
22. SPECIAL RIGHT OF EMPLOYEE UNDER CERTAIN CIRCUMSTANCES. During the term
-----------------------------------------------------
of this Agreement, if (i) Employer is involved in a merger, consolidation or
other business combination in which Employer is not the surviving and
controlling entity; or (ii) all or substantially all the assets of Employer or
its
6
<PAGE>
principal subsidiary are sold; or (iii) in the event Employee is required to
relocate outside the Phoenix, Arizona area in a manner not mutually acceptable
to Employee and Employer, then Employee shall have the following rights:
A) To terminate this Agreement with 30 days prior notice, in which
event Employer shall pay Employee as if there were a termination without
cause by the Employer; and
B) All options granted shall, to the extent not specifically
prohibited by the stock option plan then in effect, vest immediately and be
exercisable within one year of the occurring of one of the events set forth
in (i), (ii) or (iii) above.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year
first above written.
Meadow Valley Corporation
/s/ Bradley E. Larson By [SIGNATURE ILLEGIBLE]
- ----------------------------- ---------------------------------
Employee Chairman - Compensation Committee
7
<PAGE>
EXHIBIT 10.76
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is entered into as of the 21st day of January
1997, by and between Meadow Valley Corporation, a Nevada corporation (the
"Employer"), and Gary W. Burnell (the "Employee").
The Employer hereby employs the Employee on a full-time basis, and the
Employee hereby accepts such full-time employment on the terms and conditions
hereinafter set forth.
1. EMPLOYMENT. Employee is employed as the Chief Financial Officer,
----------
Treasurer and Vice President for the Employer. Employee shall perform all duties
as outlined herein and as may be assigned by the Employer and shall devote full
time, attention and loyalty to the affairs of the Employer. The duties of the
Employee shall specifically be:
A) To be responsible for all accounting, cash flow, and financial
reporting functions of the Company.
B) To prepare annual operating plans, capital improvement programs,
budgets and annual updates of five-year strategic plans.
C) To manage and supervise the staff and supervise all
accounting-related functions.
D) To manage affairs with all banking and other financial
institutions.
E) To represent the Employer to outside investors/stockholders,
assist in providing investing information to brokers/dealers and other
interested investors. To assist the CEO with presentation of investor
information to the investing community.
F) To assist in evaluating and analyzing potential acquisition
and/or investment opportunities of the Company. To serve as a source of analysis
for management and the board.
G) To assist in all administrative functions including insurance,
bonding, legal, etc.
H) To perform or cause to be performed any other reasonable duties
specifically assigned by the CEO and consistent with customary professionalism.
2. TERM. Subject to the provisions of termination provided in paragraph
----
12, the initial term of this Agreement shall commence on April 1, 1997 and
terminate on March 31, 2002. This Agreement may be extended by the mutual
written agreement of the Employee and the Employer.
3. COMPENSATION. Employee shall receive a base salary of One Hundred
------------
Ten Thousand Dollars ($110,000.00) per year, payable in accordance with the
regular payroll practices of Employer, and subject to applicable deductions of
withholding taxes and other customary employment taxes. Compensation is to begin
effective April 1, 1997, regardless of the date of execution of this Agreement.
The Chief Executive Officer of Employee shall review Employee's salary at a
minimum annually and may adjust Employee's salary upward to recognize
improvement, achievement or
<PAGE>
expansion of Employee's responsibilities subject to approval of the Board
Compensation Committee.
Employee shall participate as a member of senior management in cash
incentive plans as currently existing or as amended or adopted in the future by
the Compensation Committee of Employer's Board of Directors. Cash bonus plans
are subject to annual review and/or change as recommended by the Compensation
Committee and approved by the Board of Directors.
4. OPTIONS TO ACQUIRE COMMON STOCK. Upon written notice of acceptance of
-------------------------------
an offer of full-time employment Employee shall be granted an option to purchase
80,000 shares of the Company's common stock under the terms of the Meadow Valley
Corporation 1994 Stock Option Plan. Future grants of stock options shall be
subject to the discretion of Meadow Valley Corporation's board of directors.
5. EMPLOYEE BENEFITS. Employer shall provide to Employee, and to the
-----------------
Employee's dependents, a comprehensive major medical, health, and dental
insurance program comparable to the programs normally provided by other
employers in the same industry and marketplace, and the Employer shall pay the
cost of the Employee's portion of the premium. Should, at any time, the Employee
opt to maintain a personal major medical and health insurance policy for
himself and for his dependents and not participate in the Employer's group plan,
then Employer shall reimburse Employee the lesser of the amount Employee pays
for said personal policy, as evidenced by adequate documentation, or what
Employer would otherwise be paying were Employee participating in the Employer's
group plan. Should the Employee opt to maintain his own coverage, neither he nor
his dependents shall be precluded from later participating in the Employer's
group plan so long as they otherwise qualify for enrollment.
At Employer's cost, Employer will by April 1, 1997, obtain a life insurance
policy covering Employee, with at least $250,000 of death benefits being
payable, in a manner that is free of income tax, to Employee's estate or other
beneficiaries designated by Employee.
Employer agrees to provide Employee with an automobile for business-related
use. In addition to the cost of the vehicle itself, Employer shall pay, directly
or by reimbursement to Employee, for all maintenance, fuel, repairs, insurance,
operating and other costs incidental thereto.
Employer shall pay for, or reimburse Employee for, dues for his membership
in Financial Executives Institute, the American Institute of CPAs and one state
society of CPAs, as well as any other professional associations that are
perceived as beneficial to Employer. Additionally, Employer will provide
reasonable time for and pay the registration and related expense for the
Employee to participate in a sufficient number of hours of continuing education
course (currently thirty hours per year average) to maintain his membership in
the American Institute of CPAs.
So long as it is within the guidelines of the respective plan, Employee
shall be given the opportunity to participate in Employer's 401(k) and any other
plans made available to other members of executive management.
<PAGE>
Employee shall be entitled to receive all other employee benefits for
senior management personnel upon the terms and conditions then in effect.
6. MOVING EXPENSES AND SUBSISTENCE. Employer shall pay for all moving
-------------------------------
costs of reasonable and normal household effects from Tulsa to the Phoenix area,
including up to six months storage of such household effects in Tulsa or
Phoenix, whichever is more economical and practical, while Employee and his
spouse obtain a permanent residence in the Phoenix area. Employee shall obtain a
minimum of two moving and storage quotes from reputable movers and Employer
shall pay the most competitive rate.
Employer shall provide Employee a subsistence allowance of One Thousand
Dollars ($1000.00) per month for the lesser of nine months from April 1, 1997 or
until such time as the relocation of Employee and his spouse to the Phoenix area
is complete. In addition, costs for one round-trip airline ticket per week
between Tulsa and Phoenix will be reimbursed by Employer to Employee during the
same nine-month period, or less if relocation to the Phoenix area is completed
earlier. Such tickets can be used either by Employee or by his spouse.
7. HOLIDAYS AND VACATION.
---------------------
A) Employee shall be paid for the following seven (7) holidays: New
Year's Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
the day after Thanksgiving, and Christmas Day and all other holidays for
Employees of the Company as approved by the Chief Executive Officer or
Board of Directors.
B) Employee is entitled to four weeks vacation during the first year
of employment and for each year thereafter. Unused vacation in any given
year shall accrue to following years up to a maximum of eight weeks in any
one year.
8. RESPONSIBILITIES OF EMPLOYEE. The Employee shall devote such
----------------------------
reasonable time as is necessary or is deemed reasonably necessary by the
Employer to carry out all required duties and will devote full time to the
Employer during normal business hours. The Employee shall at all times
faithfully, with diligence and to the Employee's best good faith ability,
experience and talents, perform all the duties that may be required pursuant to
the express terms hereof to the reasonable satisfaction of the Employer, in
accordance with customary professional standards.
9. WORKING FACILITIES. The Employee shall be furnished with all
------------------
facilities and services suitable to Employee's position and adequate for the
performance of Employee's duties.
10. EXPENSES. The Employee is authorized to incur reasonable expenses for
--------
promoting business of the Employer, including expenses for entertainment, travel
and similar items. The Employer shall reimburse the Employee for all such
expenses on the presentation by the Employee of itemized and adequately
documented accounts of such expenditures.
<PAGE>
11. DISABILITY. If unable to perform duties under the terms of this
----------
Agreement by reason of illness or incapacity for a period of four weeks,
Employee shall, commencing at the end of such four week period, be entitled to
receive Employee's compensation hereunder for a period of up to and including a
maximum of one year or until he is no longer disabled, whichever occurs first.
Thereafter, Employee, or his designated beneficiary, shall be provided a
disability insurance policy, at no cost to Employee, that provides for monthly
payments at the rate of at least sixty percent (60%) of the Employee's base
salary at the time the disability occurred, such payments to continue until
Employee reaches 65 years old or is no longer disabled whichever occurs first.
12. TERMINATION. This Employment Agreement may be terminated under the
-----------
following circumstances:
A) WITHOUT CAUSE. Employer may terminate this Agreement at any time
-------------
upon thirty (30) days written notice to Employee, but Employer shall be
obligated to pay to Employee compensation in a lump sum for the balance of
the term of this Agreement within 30 days of termination, unless Employee
agrees to other payment terms.
B) VOLUNTARY TERMINATION BY EMPLOYEE WITHOUT CAUSE. Employee may
-----------------------------------------------
terminate this Agreement at any time upon thirty (30) days written notice
to Employer and Employer shall be obligated, in that event, to pay Employee
compensation up to the date of the termination only. All accrued but unpaid
compensation and Employee benefits shall be paid in cash within 30 days of
termination, unless Employee agrees to other payment terms.
C) TERMINATION BY EMPLOYER FOR REASONABLE CAUSE. The Employer may
--------------------------------------------
terminate this Agreement for reasonable cause upon the unanimous vote of
the Board of Directors and by thirty (30) days written notice to the
Employee and Employer shall be obligated, in that event, to pay Employee
compensation up to the date of termination only. For purposes hereof,
"cause" shall be defined as meaning (i) such conduct by the Employee which
constitutes material breach of this Agreement which is not cured within
ninety (90) days of written notice to the Employee of said alleged breach
or (ii) a material failure to competently perform Employee's duties as
stated in paragraph 1 in accordance with applicable professional standards
as stated in paragraph 1 and 8 hereof provided that Employer has previously
given Employee written notice and a reasonable opportunity to remedy such
failure and such failure has a materially adverse effect on the business or
financial condition of Employer or (iii) material breach of Employee's
fiduciary duty and such breach has a material adverse effect on the
business or financial condition of Employer or (iv) egregiously improper or
illegal conduct of the Employee which, based upon a unanimous good faith
determination of the Board of Directors of the Employer, has a material
adverse affect on Employer.
<PAGE>
D) TERMINATION BY EMPLOYEE FOR REASONABLE CAUSE. Employee may
--------------------------------------------
terminate this Agreement for cause. In such event, Employer shall be
obligated to pay Employee compensation in lump sum for the balance of the
term of this Agreement within 30 days of termination or as Employee shall
agree, plus damages suffered and expenses incurred by reason thereof. For
this purpose "cause" shall mean (i) a material breach of this Agreement by
Employer or (ii) failure of Employer to pay any amount owed Employee
hereunder at the time and in the amount due or (iii) failure of Employer to
follow applicable law, especially with respect to SEC filings and
compliance over the objection of Employee or contrary to the reasonable
advice of Employee or (iv) egregiously improper conduct with respect to
dealing with Employee or in a manner which brings discredit to Employee.
13. CONFIDENTIALITY. Employee agrees not to disclose any confidential,
---------------
proprietary competitively sensitive information to persons who are not
employees, directors, lenders, bonding agents, insurance companies or advisors
of the Employer, except as required by law, without prior consent of the
Employer, provided however, any disclosure involving this paragraph shall not
result in a breach of this Agreement unless the disclosure has a materially
adverse effect on the Employer.
14. INDEMNIFICATION. Employer and Meadow Valley Contractors, Inc. shall
---------------
provide Employee with an Officer Indemnification Agreement in the form attached
hereto.
15. NOTICES. All notices, demands, and communications given under this
-------
Agreement ("Notice") shall be in writing and delivered personally or sent by
registered or certified mail, return receipt requested, in the United States
mail, postage prepaid, addressed as follows:
If to Employer:
Meadow Valley Corporation
P.O. Box 60726
Phoenix, AZ 85082-0726
If to Employee:
Gary W. Burnell
8205 S. Marion Avenue
Tulsa, OK 74137
or at such other address as a party may from time to time designate by Notice
hereunder. Notice shall be effective upon delivery in person, or if mailed, at
midnight on the third business day after the date of mailing.
16. ASSIGNMENT OF AGREEMENT. Neither party may assign or otherwise
-----------------------
transfer this Agreement or any of its rights or obligations hereunder without
the
<PAGE>
prior written consent to such assignment or transfer by the other party
hereto; and all the provisions of this Agreement shall be binding upon the
respective employees, successors, heirs and assigns of the parties; provided,
however, the benefits payable to Employee hereunder in the event of disability
or death or incapacity are payable to Employee's spouse or personal
representative.
17. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS. This Agreement
-----------------------------------------------------
and the representations, warranties, covenants and other agreements (however
characterized or described) by both parties and contained herein or made
pursuant to the provisions hereof shall survive the execution and delivery of
this Agreement.
18. FURTHER INSTRUMENTS. The parties shall execute and deliver any and
-------------------
all such other instruments in reasonable mutually acceptable form and substance
and shall take any and all such other actions as may be reasonably necessary to
carry the intent of the Agreement into full force and effect.
19. SEVERABILITY. If any provision of this Agreement shall be held,
------------
declared or pronounced void, voidable, invalid, unenforceable or inoperative for
any reason by any court of competent jurisdiction, governmental authority or
otherwise, such holding, declaration or pronouncement shall not affect adversely
any other provision of this Agreement, which shall otherwise remain in full
force and effect and be enforced in accordance with its terms, and the effect of
such holding, declaration or pronouncement shall be limited to the territory of
jurisdiction in which made.
20. WAIVER. All the rights and remedies of either party under this
------
Agreement are cumulative and not exclusive of any other rights and remedies
provided by law. No delay or failure on the part of either party in the exercise
of any right or remedy arising from a breach of this Agreement shall operate as
a waiver of any subsequent right or remedy arising from a subsequent breach of
this Agreement. The consent of any party where required hereunder to any act or
occurrence shall not be deemed to be a consent to any other act or occurrence.
21. GENERAL PROVISIONS. This Agreement shall be construed and enforced in
------------------
accordance with, and governed by, the laws of the state of Arizona. Except as
otherwise expressly stated herein, time is of the essence in performing under
this Agreement. This Agreement embodies the entire agreement and understanding
between the parties and supersedes all prior agreements and understandings
relating to the subject matter of this Agreement as it relates to the parties'
duties and obligations from and after April 1, 1997, and this Agreement may not
be modified or amended or any term or provision hereof waived or discharged
except in writing signed by the party against whom such amendment, modification,
waiver or discharge is sought to be enforced. The headings of this Agreement
are for convenience in reference only and shall not limit or otherwise affect
the meaning thereof. This Agreement may be executed in any number of
<PAGE>
counterparts, each of which shall be deemed an original but all of which taken
together shall constitute one and the same instrument.
22. SPECIAL RIGHT OF EMPLOYEE UNDER CERTAIN CIRCUMSTANCES. During the term
-----------------------------------------------------
of this Agreement, if (i) Employer is involved in a merger, consolidation or
other business combination in which Employer is not the surviving and
controlling entity; or (ii) all or substantially all the assets of Employer or
its principal subsidiary are sold; or (iii) in the event Employee is required to
relocate outside the Pheonix metropolitan area in a manner not mutually
acceptable to Employee and Employer, then Employee shall have the following
rights:
A) To terminate this Agreement with 30 days prior notice, in which event
Employer shall pay Employee as if there were a termination without cause by the
Employer; and
B) All options granted shall, to the extent not specifically prohibited
by the stock option plan then in effect, vest immediately and be exercisable
within one year of the occurring of one of the events set forth in (i), (ii) or
(iii) above.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year
first above written.
Meadow Valley Corporation
/s/ Gary W. Burnell By /s/ Bradley E. Larson
- ----------------------------- ---------------------------------
Employee President/CEO
<PAGE>
MEADOW VALLEY CORPORATION AND
MEADOW VALLEY CONTRACTORS, INC.
OFFICER/DIRECTOR INDEMNIFICATION AGREEMENT
------------------------------------------
THIS AGREEMENT ("Agreement") is entered into and effective this 1st day of
April, 1997, by and between Meadow Valley Corporation and Meadow Valley
Contractors, Inc., Nevada corporations ("Corporation"), and Gary W. Burnell
("Indemnified Party").
WHEREAS, the Board of Directors has determined that it is in the best
interest of the Corporation and its shareholders to agree to indemnify
Indemnified Party (who is a Director and/or Officer of the Corporation) from and
against certain liabilities for actions taken by him during the performance of
his tasks for the Corporation.
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt, adequacy and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. INDEMNIFICATION. The Corporation hereby agrees to indemnify and hold
---------------
harmless Indemnified Party to the maximum extent possible under all applicable
laws against any and all claims, demands, debts, duties, liabilities, judgments,
fines and amounts paid in settlement and expenses (including attorneys' fees and
expenses) actually and reasonably incurred by Indemnified Party in connection
with the investigation, defense, negotiation and settlement of any such claim or
any threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (including an action by or in the
right of the Corporation) to which Indemnified Party is or becomes a party, or
is threatened to be made a party, by reason of the fact that Indemnified Party
is an officer or a director of the Corporation or any of its subsidiaries.
2. LIMITATIONS ON INDEMNITY. No indemnity pursuant to this Agreement
------------------------
shall be made by the Corporation:
(a) For the amount of such losses for which the Indemnified Party is
indemnified pursuant to any insurance purchased and maintained by the
Corporation; or
(b) In respect to remuneration paid to Indemnified Party if it shall be
determined by a final judgment or other final adjudication that such
remuneration was in violation of law; or
(c) On account of any suit in which judgement is rendered against
Indemnified Party for an accounting of profits made (i) for an
improper personal profit without full and fair disclosure to the
Corporation of all material conflicts of interest and not approved
thereof by a majority of the disinterested members of the Board of
Directors of the Corporation; or (ii) from the purchase or sale by
Indemnified Party of securities of the Corporation pursuant to the
provisions of Section 16(b) of the Securities Exchange Act
<PAGE>
of 1934 and amendments thereto or similar provisions of any federal,
state or local law; or
(d) On account of Indemnified Party's conduct which is finally determined
to have been knowingly fraudulent, deliberately dishonest or willfully
in violation of applicable law for which the corporation suffered
actual financial damages; or
(e) If a final decision by a court having jurisdiction in the matter shall
determine that such indemnification is not lawful.
3. CONTINUATION OF INDEMNITY. All agreements and obligations of the
-------------------------
Corporation contained herein shall continue during the period Indemnified Party
is an officer or director of the Corporation or a subsidiary and thereafter so
long as Indemnified Party shall be subject to any possible claim or threatened,
pending or completed action, suit or proceeding, whether civil, criminal or
investigative, by reason of the fact that Indemnified Party was an officer or a
director of the Corporation or any subsidiary.
4. NOTIFICATION AND DEFENSE OF CLAIM. Within 30 days after receipt by
---------------------------------
Indemnified Party of notice of any claim or any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative, in which Indemnified Party has a right to Indemnification
hereunder, Indemnified Party will notify the Corporation of the commencement
thereof. With respect to any such action, suit or proceeding as to which
Indemnified Party notifies the Corporation of the commencement thereof:
(a) The Corporation will be entitled to participate therein at its own
expense; and
(b) Except as otherwise provided below, to the extent that it may wish,
the Corporation jointly with any other indemnifying party will be
entitled to assume the defense thereof, with counsel satisfactory to
Indemnify Party. After notice from the Corporation to Indemnified
Party of its election to assume the defense thereof, the Corporation
will not be liable to Indemnified Party under this Agreement for any
legal or other expenses subsequently incurred by Indemnified Party in
connection with the defense thereof other than reasonable costs of
investigation or as otherwise provided below. Indemnified Party shall
have the right to employ counsel in such action, suit or proceeding,
but the fees and expenses of such counsel incurred after notice from
the Corporation of its assumption of the defense thereof shall be at
the expense of Indemnified Party, unless (i) the employment of counsel
by Indemnified Party has been authorized by the Corporation, (ii)
Indemnified Party shall have reasonably concluded that there may be a
conflict of interest between the Corporation and Indemnified Party in
the conduct of the defense of such action, (iii) the Corporation shall
not in fact have employed counsel to assume the defense of such
action, in each of which cases the fees and expenses of counsel shall
be at the expense of the Corporation, or (iv) unless the Indemnified
<PAGE>
Party reasonably and in good faith asserts defenses and theories of
defense not asserted by the Corporation. The Corporation shall not be
entitled to assume the defense of any action, suit or proceeding
brought by or on behalf of the Corporation or as to which Indemnified
Party shall have made the conclusion provided for in (ii) or (iv)
above.
(c) The Corporation shall not be liable to indemnify Indemnified Party
under this Agreement for any amounts paid in settlement of any action
or claim effected without the Corporation's written consent. The
Corporation shall not settle any action or claim in any manner which
would impose any penalty or limitation on Indemnified Party without
Indemnified Party's written consent. Neither the Corporation or
Indemnified Party will unreasonably withhold their consent to any
proposed settlement.
5. REPAYMENT OF EXPENSES. Indemnified Party agrees that Indemnified Party
---------------------
will reimburse the Corporation for all reasonable expenses paid by the
Corporation in defending any civil or criminal action, suit or proceeding
against Indemnified Party in the event and only to the extent that Indemnified
Party is finally determined that Indemnified Party is not entitled to be
indemnified by the Corporation for such expenses under the Corporation's charter
or bylaws, this Agreement or under applicable law.
6. ENFORCEMENT.
-----------
(a) The Corporation expressly confirms and agrees that it has entered into
this Agreement and assumed the obligations imposed on the Corporation
hereby in order to induce Indemnified Party to serve as an officer
and/or director of the Corporation or any subsidiary thereof, and
acknowledges that Indemnified Party is relying upon this Agreement as
part of the consideration for so acting.
(b) In the event Indemnified Party is required to bring any action to
enforce rights or to collect moneys due under this Agreement and is
successful in such action, the Corporation shall reimburse Indemnified
Party for all of Indemnified Party's reasonable attorneys' and other
fees and expenses in bringing and pursuing such action.
7. SEVERABILITY. Each of the provisions of this Agreement is a separate
------------
and distinct agreement and independent of the others, so that if any provision
hereof shall be held to be invalid or unenforceable for any reason, such
invalidity or unenforceability shall not affect the validity or enforceability
of the other provisions hereof.
8. GOVERNING LAW; BINDING EFFECT; AMENDMENT AND TERMINATION.
--------------------------------------------------------
(a) This Agreement shall be interpreted and enforced in accordance with
the laws of the State of Arizona.
(b) This Agreement shall be binding upon Indemnified Party and upon the
Corporation, its successors and assigns, and shall inure to the
benefit of
<PAGE>
Indemnified Party, his heirs, personal representatives and assigns and
to the benefit of the Corporation, its successors and assigns.
(c) No amendment, modification, termination or change of this Agreement
shall be effective unless it is signed by both parties hereto.
9. ADDITIONAL RIGHTS. This Agreement is in addition to, and not in lieu
-----------------
of, any other right to indemnification under the Corporation's corporate
charter, bylaws, insurance contracts or otherwise at law or in equity.
IN WITNESS WHEREOF, the parties were have executed this Agreement on and as
of the day and year first above written.
MEADOW VALLEY CORPORATION AND
MEADOW VALLEY CONTRACTORS, INC.
By: /s/ Bradley E. Larson
-----------------------------------------------
Bradley E. Larson, President and Chief Executive
Officer
Indemnified Party:
/s/ Gary W. Burnell
--------------------------------------------------
Gary W. Burnell
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