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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, 1998
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)
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<S> <C>
Nevada 88-0328443
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(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification Number)
4411 South 40th Street, Suite D-11, Phoenix, AZ 85040
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(Address of principal executive offices) (Zip Code)
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(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.
On February 16, 1999, the aggregate market value of the registrant's voting
stock held by non-affiliates was $16,409,738.
On February 16, 1999, 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, 1998.
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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 this 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
this 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. On January 4, 1999, the $10 million promissory note was paid in
full. 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.
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.
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 $220 million at December
31, 1998, which included the remainder of a $92.1 million portion of the
reconstruction of the core of the interchange at I-15 and US 95 in Las Vegas,
NV, the remainder of a $38.7 million portion of the Squaw Peak Pkwy Freeway
Continuation in Phoenix, AZ, the remainder of a $56.6 million portion of the
Pima Freeway Continuation, in Phoenix, AZ and the remainder of $84.6 million of
projects which are portions of the Beltway Continuation projects in Las Vegas,
Nevada. The Company's backlog includes approximately $186 million of work that
is scheduled for completion during 1999. 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.
In 1996, the Company acquired certain assets, including the tradename, of
AKR Contracting ("AKR"), an unaffiliated Company in Phoenix, Arizona. AKR
previously specialized in earthwork, grading and paving of residential
subdivisions and commercial centers, but has since 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
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existing geographic market and enhance its construction operations in its
existing market. To date, AKR has assisted the Company in its expansion into New
Mexico and a broadening of the work it performs in Arizona. Moreover, the
Company believes the AKR equipment improves its competitiveness and may generate
increased revenues on projects that call for large quantities of asphaltic
concrete, recycled asphalt or rubberized asphalt.
In 1996, the Company expanded its Nevada construction industry activities
with the formation of Ready Mix, Inc. ("RMI") as a wholly-owned subsidiary. RMI
manufactures and distributes ready mix concrete in Las Vegas, NV, and targets
prospective customers 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, RMI intends to operate from two or more sites using at least 40 mixer
trucks.
In 1996, the Company formed Prestressed Products Incorporated ("PPI") as a
wholly-owned subsidiary to design, manufacture and erect precast prestressed
concrete building components for use on commercial, institutional and public
construction projects throughout the Southwest. Product lines included
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. As a result of continuing operating losses, in June
1998, the Company adopted a formal plan (the "plan") to discontinue the
operations of PPI. The plan included the completion of approximately $2.8
million of uncompleted contracts and the disposition of approximately $1.2
million of equipment. The Company recorded an estimated loss of $1,950,000 (net
of income tax benefit of $1,300,000), related to the disposal of assets of PPI,
which included a provision of $1,350,000 for estimated losses during the
phase-out period of July 1, 1998 through June 30, 1999. Management anticipates
that the remaining contracts will be completed before the end of April 1999 and
the collection of outstanding receivables and the disposition of assets will be
completed before the end of the second quarter 1999.
In 1997, financed through internal funds and operating leases, the Company
obtained equipment and experienced personnel to expand its construction
capabilities to include the performance of concrete or "white" paving. By
performing white paving work, the Company may be able to increase its project
revenue and earnings, reduce reliance on white paving subcontractors, maintain
greater control over project schedules 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.
This may include acquiring equipment and personnel to increase the amount of
work performed by the Company itself as opposed to subcontracted to others.
(ii) Increase the Company's ownership and/or control of strategic
aggregate resources. The Company has successfully obtained mineral leases on a
number of aggregate resources strategically located near geographic locations in
which the Company is currently competing. Control of aggregate resources may
enhance the Company's competitiveness on work it performs while adding a new
source of revenue and potential profit for materials sold to third parties.
(iii) Solidify market position. The Company intends to continue to expand
its construction and materials operations in Nevada, Arizona, Utah and New
Mexico and will consider expansion into other western states. The Company
intends to further develop its position as a commercial supplier and producer of
aggregates and related materials such as ready mix concrete and asphalt.
(iv) Seek to acquire other businesses. The Company may 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
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services similar to the Company in geographic locations not currently served by
the Company. For certain projects, the Company may join with one or more
companies to combine expertise, financial strength, and/or bonding capacity.
Through a joint venture, the Company may elect to pursue projects which might
otherwise exceed its staffing or bonding resources, including design-build type
projects within the Company's existing market.
(iv) Increase bonding capacity. The Company will continue to seek to
increase its bonding capacity in order to allow it to increase its volume of
bids and work. 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. On June 9, 1998, the Transportation Equity Act
for the 21st Century ("TEA 21") was signed into law. This bill establishes a
total budget authority of $215 billion over the six year period 1998-2003. TEA
21 ensures that tax revenue deposited into the Highway Trust Fund will be spent
on transportation improvements by guaranteeing $165 billion for highways and $35
billion for transit and by further stipulating that appropriators can spend
trust fund dollars only on transportation.
Growth in the Company's market continues to outperform many areas of the
country. The states of Arizona, Nevada and Utah are among the leaders in key
growth statistics such as population growth and employment. On a percentage
basis, Nevada led the nation for 1998 in population growth, with Arizona in
second place. Nevada, Arizona, Utah, Idaho and Georgia have been the fastest
growing states in the United States in the 1990's. This growth has led to record
levels of residential and commercial construction and to increased
transportation infrastructure work. Consensus among forecasters is that this
growth will slow from 1998 to 1999, with the exception of the transportation
infrastructure segment. Over the six year term of TEA 21, the annual average
funding for transportation infrastructure will increase by 61.8% in Nevada,
59.5% in Arizona, 57.8% in Utah and 45.3% in New Mexico. The state departments
of transportation, along with metropolitan planning organizations will be the
primary parties responsible for administering the TEA 21 funds. In addition to
TEA 21 funds, existing local funding mechanisms will continue to provide for
construction of key transportation facilities through 2015 to fund construction
of multi-billion dollar freeway transportation facilities. Airports in Phoenix,
Las Vegas and Salt Lake City also have substantial capital improvement programs
in excess of $500 million each.
RMI, the Company's ready mix concrete subsidiary, is affected most by the
amount of new residential and commercial construction in the Las Vegas, NV area.
Forecasts for 1999 predict that residential and commercial construction in the
Las Vegas, NV area will be less than 1998 levels. RMI's primary customers have
been residential builders and residential construction is expected to decline.
As a result, the Company may be faced with increased competition from other
local suppliers of ready mix concrete. RMI plans to increase its activity in the
infrastructure portion of the market and may more frequently provide concrete to
its sister company, MVC.
The Company believes the overall economic health in its existing market
will present 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 Phoenix, Arizona, Moapa,
Nevada, Salt Lake City, Utah and Ruidoso, 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
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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 project's
projected performance at completion by using actual costs-to-date and re-
forecasted costs-to-complete for the 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, batch plants and related equipment. The net book value of the
Company's equipment at December 31, 1998 was approximately $11.0 million. During
1998, the Company's acquired $3.9 million of property and equipment, primarily
the acquisition of a second asphalt plant and additional equipment needed for
the added construction workload. The Company leases a significant portion of its
equipment and attempts to keep the equipment as fully utilized as possible. It
may rent equipment on a short-term basis to subcontractors.
The Company's corporate management oversees operational and strategic
issues and, through the corporate accounting staff, provides administrative
support services to subsidiary managers, area managers 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 managers, 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 area 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, 1998, revenue
generated from six projects in Nevada, Arizona and Utah represented 60% 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,
1996, 1997 and 1998 Clark County General Services and the Arizona Department of
Transportation each accounted for over 10% of the Company's consolidated
revenue. Additionally, the Nevada Department of Transportation accounted for
over 10% of the Company's consolidated revenue during the year ended December
31, 1998.
The following table describes all projects substantially completed by the
Company in each of the three years ended December 31, 1996, 1997 and 1998.
Contract amounts include agreed upon change orders, if any, and represent the
total dollar value of the contract to the Company.
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CONTRACT COMPLETION
CUSTOMER PROJECT DESIGNATION LOCATION AMOUNT DATE
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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
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
</TABLE>
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CONTRACT COMPLETION
CUSTOMER PROJECT DESIGNATION LOCATION AMOUNT DATE
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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
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
</TABLE>
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CONTRACT COMPLETION
CUSTOMER PROJECT DESIGNATION LOCATION AMOUNT DATE
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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
Clark County, Nevada McCarran Airport Parking
General Services Garage Las Vegas, NV 60,299,916 March 1998
Clark County Department
of Aviation Runway Extension Las Vegas, NV 11,062,630 March 1998
Clark County Department
of Aviation Union Pacific R.R.Relocation Las Vegas, NV 2,019,620 March 1998
Dept. of United States
Army White Sands Missile Range New Mexico 2,106,670 June 1998
Dept. of Transportation
Hwy. Administration Wiggins Crossing Arizona 794,611 March 1998
Clark County Department
of Aviation McCarran Air Cargo Expansion Las Vegas, NV 2,543,872 March 1998
New Mexico Department
of Transportation I-25/Socorro New Mexico 3,315,876 June 1998
Jackson Properties Country Meadows Maricopa County 812,706 February 1998
United States Marine
Corp. Yuma Taxiway Repair Yuma, AZ 708,220 March 1998
Arizona Department of
Transportation Douglas Rodeo Highway Douglas, AZ 1,435,326 March 1998
City of Mesa City of Mesa Sealcoat Mesa, AZ 83,913 March 1998
Clark County General
Services Sloan Channel Las Vegas, NV 1,296,493 March 1998
Nevada Department of
Transportation NDOT Bike Path Las Vegas, NV 1,620,687 March 1998
Clark County General
Services Channel Repair Las Vegas, NV 198,882 May 1998
Clark County General
Services Russell Road Las Vegas, NV 4,892,226 March 1998
Arizona Department of
Transportation White River Arizona 673,362 March 1998
City of Phoenix City of Phoenix Overlay II Phoenix, AZ 2,182,882 February 1998
</TABLE>
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CONTRACT COMPLETION
CUSTOMER PROJECT DESIGNATION LOCATION AMOUNT DATE
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Coconino County,
Fann Construction Clint's Well AZ $ 676,092 March 1998
Dept. of United States
Army White Sands MissileRange New Mexico 855,108 June 1998
Clark County Department
of Public Works LV Beltway Las Vegas, NV 29,169,402 March 1998
</TABLE>
The following table describes all projects of the Company in progress as of
December 31, 1998. Current contract amounts include agreed upon change orders,
if any, and represent the dollar value of the contract to the Company.
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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 November 1995/
Transportation (Joint Venture) Phoenix, AZ $ 20,991,224 April 1999
Clark County Department June 1996/
of Aviation Ticketing Facility Las Vegas, NV 9,097,786 March 1999
Clark County Department August 1996/
of Aviation Terminal D Sitework Las Vegas, NV 39,516,609 April 1999
Arizona Department of Squaw Peak Shea-TBird October 1996/
Transportation Continuation Phoenix, AZ 38,747,627 November 1999
United States Forest Roosevelt Lake, October 1996/
Service School House Campground AZ 4,833,884 January 1999
Utah Department of October 1996/
Transportation I-15/Woods Crossing Salt Lake, UT 19,066,321 March 1999
Arizona Department of February 1997/
Transportation Payson Show-Low Payson, AZ 4,002,855 February 1999
Arizona Department of Coconino County, June 1997/
Transportation Blueridge-Forest AZ 2,401,933 February 1999
Clark County General September 1997/
Services McCarran Mobil Home Park Las Vegas, NV 8,958,184 June 1999
Arizona Department of June 1997/
Transportation Pima Freeway Phoenix, AZ 56,588,647 September 2000
Utah Department of Salt Lake City, August 1997/
Transportation Bangerter Highway UT 21,045,091 March 1999
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<CAPTION>
CURRENT AWARD DATE/
CONTRACT ESTIMATED
CUSTOMER PROJECT DESIGNATION LOCATION AMOUNT COMPLETION DATE
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<S> <C> <C> <C> <C>
Salt Lake City Airport Salt Lake City, August 1997/
Authority Utah Taxiway UT $ 9,537,445 March 1999
Arizona Department of August 1997/
Transportation Ashfork Devildog Williams, AZ 3,646,313 February 1999
Maricopa County Dept. Maricopa County, September 1997/
of Parks & Recreation Lake Pleasant AZ 1,584,813 January 1999
September 1997/
Victory Valley Land Lake Mead Henderson, NV 3,273,464 December 1999
September 1997/
City of Showlow City of Showlow Showlow, AZ 2,469,918 March 1999
New Mexico Department Donna Ana County, December 1997/
of Transportation I-15/Hatch NM 3,732,191 March 1999
New Mexico Department December 1997/
of Transportation NM Ruidoso Ruidoso, NM 9,367,476 November 1999
Arizona Department of Coconino County, December 1997/
Transportation SR87-Blueridge AZ 2,417,485 February 1999
Nevada Department of December 1997/
Transportation Spaghetti Bowl Las Vegas, NV 92,096,200 November 2000
Clark County General April 1998/
Services Yamashita Street Overton, NV 2,061,295 July 1999
Clark County General May 1998/
Services LV Beltway Sec 4 Las Vegas, NV 29,284,659 December 1999
Arizona Department of April 1998/
Transportation Pima-Red Mountain Phoenix, AZ 11,199,664 January 2000
Arizona Department of October 1998/
Transportation Pineveta/Ashfork Payson, AZ 3,324,644 October 1999
New Mexico Department May 1998/
of Transportation Ski Basin Road Ruidoso, NM 879,905 March 1999
Salt Lake City, May 1998/
Ralph Wadsworth Wadsworth/Bangerter UT 4,701,767 May 1999
New Mexico Department June 1998/
of Transportation Alamagordo Alamogordo, NM 7,084,058 December 1999
New Mexico Department July 1998/
of Transportation Ruidoso II Ruidoso, NM 7,564,710 November 2000
</TABLE>
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<CAPTION>
CURRENT AWARD DATE/
CONTRACT ESTIMATED
CUSTOMER PROJECT DESIGNATION LOCATION AMOUNT COMPLETION DATE
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<S> <C> <C> <C> <C>
New Mexico Department Ruidoso Downs, August 1998/
of Transportation US 70 NM $ 7,659,877 May 2000
Arizona Department of September 1998/
Transportation Sunflower Sunflower, AZ 30,564,147 September 2001
New Mexico Department November 1998/
of Transportation Alamagordo II Alamagordo, NM 2,243,292 December 1999
Utah Department of October 1998/
Transportation Grassy Mountain Delle, UT 3,475,328 August 1999
Clark County General September 1998/
Services LV Beltway Section 7, 8 & 9 Las Vegas, NV 55,397,771 June 2000
October 1998/
Victory Valley Land Black Mountain Industrial Las Vegas, NV 1,557,992 December 2000
Maricopa County Department December 1998/
of Transportation Eagle Eye Road Elloy, AZ 2,447,357 May 1999
</TABLE>
BACKLOG
The Company's backlog (anticipated revenue from the uncompleted portions of
awarded projects) was approximately $220 million at December 31, 1998, compared
to approximately $214 million at December 31, 1997. At December 31, 1998, the
Company's backlog included approximately $186 million of work that is scheduled
for completion during 1999. 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. Revenue is impacted in any one period by the
backlog at the beginning of the period. The Company's backlog depends upon the
Company's success in the competitive bid process. Bidding strategies and
priorities may be influenced and changed from time to time by the level of the
Company's backlog and other internal and external factors. 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., Sundt Corp. and Morrison Knudsen), many of whom have larger net
worths, higher bonding capacities and more 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,
11
<PAGE>
additional competition 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 $110 million
and has an aggregate program bond capacity of over $300 million. The Company
believes its bonding capacity is sufficient to sustain anticipated growth.
Larger competitors typically 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, long 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 the Company may expand. Initially,
the Company will be at a competitive disadvantage in new geographic locations
until it obtains information on those locations 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 21% 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 public sector 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, guardrail and
fencing, signing and signals, foundation drilling, steel erection and other
specialty 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,
12
<PAGE>
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 not been materially adversely
affected by subcontractor related losses over the past five years. 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 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 $16 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,
the number and size of projects under construction 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. 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 $110 million and has an aggregate program bond
capacity of over $300 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.
For its ready mix operations which the Company pursues through its RMI
subsidiary, a more focused marketing effort is required. Certification of plant
and facilities must be obtained and maintained in order to comply with certain
project requirements. Membership and participation in selected industry
associations help increase the Company's exposure to potential
13
<PAGE>
clients and are two means by which the Company stays informed on industry
developments and future prospects within the marketplace. Customer care and
service are important tools for RMI which focuses 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 RMI.
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 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, 1998, the Company employed approximately 81 salaried
employees (including its management personnel and executive officers) and
approximately 469 hourly employees. The number of hourly employees varies
depending upon the amount of construction in progress. For the year ended
December 31, 1998, the number of hourly employees ranged from approximately 450
to approximately 550 and averaged approximately 525. At December 31, 1998, the
Company is party to four project agreements in Arizona with the Arizona State
District Council of Carpenters, AFL-CIO which covers approximately 15% of the
Company's hourly workforce. At December 31, 1998, the Company believes its
relations with its employees are satisfactory.
ITEM 2. PROPERTIES
The following properties were leased by the Company at December 31, 1998:
(1) 8,300 square feet of executive office space at 4411 South 40th
Street, Suites D-10 and D-11, Phoenix, Arizona, 85040, pursuant to a
lease which expires in December 2000, at a monthly rental rate of
$6,998 per month.
(2) 1,800 square feet of office space at 1598 North 400 West, Suite C,
Layton, Utah 84041, on a month-to-month basis, at a rental rate of
$1,600 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 $2,575.
(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 $840 per
month, from a Company controlled by Kim A. Marshall, 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 Kim A. Marshall, a principal
stockholder. The Company used the property for its manufacturing of
prestressed concrete products, a discontinued operation. The lease
terminates January 31, 1999 under the plan to discontinue operations
of PPI. 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.
14
<PAGE>
The Company owns approximately 24.5 acres of property in Moapa, Nevada,
which is currently being readied for use as a storage yard.
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, 1998.
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>
1997 1998
------------------------------------------
HIGH LOW HIGH LOW
------------------------------------------
<S> <C> <C> <C> <C>
First Quarter........ 5 5/8 3 9/16 6 5/8 5 1/8
Second Quarter....... 5 7/8 3 1/2 7 5 1/2
Third Quarter........ 6 1/4 5 5/16 7 1/4 5
Fourth Quarter....... 6 9/16 5 1/2 6 1/4 4 5/8
</TABLE>
HOLDERS OF RECORD
As of February 16, 1999 there were 775 record and beneficial owners of the
Company's Common Stock.
15
<PAGE>
ITEM 6. SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31, PROFORMA
- ----------------------------------------------------
COMBINED (1)
INCOME STATEMENT DATA: 1994 1995 1996 1997 1998
------------ ----------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Revenue............................................. $80,220,521 $90,048,523 $133,723,645 $146,273,286 $187,036,077
Gross Profit........................................ 5,472,878 4,354,455 2,810,585 7,861,972 9,444,231
Income (loss) from Operations....................... 4,704,425 2,364,676 (255,072) 3,172,430 3,084,983
Interest Expense.................................... 500,000 1,116,464 611,828 624,048 435,358
Income (loss) from continuing operations
before income taxes (2).......................... 4,565,398 1,608,997 (30,410) 3,235,458 3,592,019
Net income (loss) from continuing operations........ 2,824,776 1,059,347 (37,531) 2,072,567 2,169,579
Discontinued Operations:
Loss from discontinued operations (4)............ - - (47,697) (860,952) (635,246)
Estimated loss on disposal of net assets......... - - - - (1,950,000)
of discontinued operations (5)
Net income (loss)................................... 2,824,776 1,059,347 (85,228) 1,211,615 (415,667)
Basic net income (loss) per common share:
Income (loss) from continuing operations......... $ 0.84 $ 0.65 $ (.01) $ 0.58 $ 0.60
Loss from discontinued operations................ - - (.01) (.24) (.18)
Estimated loss on disposal of net assets
of discontinued operations..................... - - - - (.54)
Basic net income (loss) per common share ........... $ 0.84 $ 0.65 $ (.02) $ .34 $ (.12)
Diluted net income (loss) per common share:
Income (loss) from continuing operations......... $ 0.84 $ 0.65 $ (.01) $ 0.57 $ 0.60
Loss from discontinued operations................ - - (.01) (.24) (.17)
Estimated loss on disposal of net assets
of discontinued operations..................... - - - - (54)
Diluted net income (loss) per common share ......... $ 0.84 $ 0.65 $ (.02) $ .33 $ (.11)
Basic weighted average common shares
outstanding (3).................................. 3,350,000 1,641,663 3,601,250 3,601,250 3,601,250
Diluted weighted average common shares
outstanding...................................... 3,350,000 1,641,663 3,601,250 3,651,360 3,644,651
FINANCIAL POSITION DATA:
Working capital (deficiency)........................ $(3,348,451) $11,319,107 $ 8,689,123 $ 5,152,550 $ 5,760,414
Total assets........................................ 22,375,168 28,909,786 42,171,030 47,737,762 49,297,063
Long-term debt...................................... - 3,689,055 4,631,377 5,847,659 5,977,643
Stockholders' equity (deficit)...................... (232,770) 11,761,997 11,676,769 12,888,384 12,472,717
</TABLE>
(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.
16
<PAGE>
(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 for 1994 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.
(4) Includes the net income tax benefit of $28,756, $443,520 and $423,497 for
the years ended December 31, 1996, 1997 and 1998 for the discontinued
operations of Prestressed Products Incorporated.
(5) Estimated loss on disposal of net assets of Prestressed Products
Incorporated (net of income tax benefit of $1,300,000), including
$1,350,000 for operating losses during the phase-out period.
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. On January 4,
1999, the $10 million promissory note was paid in full. 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.
In 1996, the Company acquired certain assets, including the tradename, of
AKR Contracting ("AKR"), an unaffiliated Company in Phoenix, Arizona. AKR
previously specialized in earthwork, grading and paving of residential
subdivisions and commercial centers, but has since 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 and enhance its construction operations in its existing
market. To date, AKR has assisted the Company in its expansion into New Mexico
and a broadening of the work it performs in Arizona. Moreover, the Company
believes the AKR equipment improves its competitiveness and may generate
increased revenues on projects that call for large quantities of asphaltic
concrete, recycled asphalt or rubberized asphalt.
17
<PAGE>
In 1996, the Company expanded its Nevada construction industry activities
with the formation of Ready Mix, Inc. ("RMI") as a wholly-owned subsidiary. RMI
manufactures and distributes ready mix concrete in Las Vegas, NV, and targets
prospective customers 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, RMI intends to operate from two or more sites using at least 40 mixer
trucks.
In 1996, the Company formed Prestressed Products Incorporated ("PPI") as a
wholly-owned subsidiary to design, manufacture and erect precast prestressed
concrete building components for use on commercial, institutional and public
construction projects throughout the Southwest. Product lines included
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. As a result of continuing operating losses in June
1998, the Company adopted a formal plan (the "plan") to discontinue the
operations of PPI. The plan included the completion of approximately $2.8
million of uncompleted contracts and the disposition of approximately $1.2
million of equipment. The Company recorded an estimated loss of $1,950,000 (net
of income tax benefit of $1,300,000), related to the disposal of assets of PPI,
which included a provision of $1,350,000 for estimated losses during the phase-
out period of July 1, 1998 through June 30, 1999. Management anticipates that
the remaining contracts will be completed before the end of April 1999 and the
collection of outstanding receivables and the disposition of assets will be
completed before the end of the second quarter 1999.
In 1997, financed through internal funds and operating leases, the Company
obtained equipment and experienced personnel to expand its construction
capabilities to include the performance of concrete or "white" paving. By
performing white paving work, the Company may be able to increase its project
revenue and earnings, reduce reliance on white paving subcontractors, maintain
greater control over project schedules 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 60% of the Company's revenue for the year ended
December 31, 1998. 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,
------------------------------------------
1996 1997 1998
------------ ------------ ------------
<S> <C> <C> <C>
Revenue........................................... 100.00% 100.00% 100.00%
Cost of revenue................................... 97.90 94.63 94.95
Gross profit...................................... 2.10 5.37 5.05
General and administrative expenses............... 2.29 3.21 3.40
Income (loss) from operations..................... (.19) 2.16 1.65
Interest income................................... .55 .46 .46
Interest expense.................................. (.46) (.43) (.23)
Other income...................................... .07 .01 .05
Net income (loss) from continuing operations...... (.03) 1.42 1.16
Loss from discontinued operations................. (.03) (.59) (.34)
Estimated loss on disposal of net assets of
discontinued operations......................... - - (1.04)
Net income (loss)................................. (.06) .83 (.22)
</TABLE>
18
<PAGE>
YEAR ENDED DECEMBER 31, 1998 COMPARED TO YEAR ENDED DECEMBER 31, 1997
Revenue and Backlog. Revenue increased 27.9% to $187.0 million for the year
ended December 31, 1998 from $146.3 million for the year ended December 31,
1997. The increase was the result of an increase in contract revenue of $36.6
million and a $4.1 million increase in revenue generated from construction
materials production and manufacturing sold to non-affiliates. Backlog increased
to $220 million at December 31, 1998 compared to $214 million at December 31,
1997. Revenue is impacted in any one period by the backlog at the beginning of
the period.
Gross Profit. As a percentage of revenue, consolidated gross profit
decreased from 5.37% in 1997 to 5.05% in 1998. The decrease in MVC's gross
profit margin was the result of (i) cost overruns on certain projects (ii)
subcontractor difficulties and (iii) costs related to plan or specification
errors. Gross profit margins are affected by a variety of factors including
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 to $6,359,248 for 1998 from $4,689,542 for 1997. The increase
resulted, in part, from costs associated with expansion into the white paving
market amounting to approximately $323,000, $267,000 in corporate labor,
$871,000 in costs related to various employee incentive plans, $120,000 in legal
costs, $35,000 in costs related to the Company's safety plan, $32,000 in costs
related to the administration of various employee incentive and benefit plans
and a variety of other costs related to the administration of the corporate and
area offices.
Interest Income and Expense. Interest income for 1998 increased to $856,191
from $666,397 in 1997 due to an increase in cash reserves resulting primarily
from billings in excess of costs and estimated earnings on uncompleted projects.
Interest expense decreased in 1998 to $435,358 from $624,048, due to a
$1,000,000 reduction in related party debt during the fourth quarter 1997 and a
$1,500,000 reduction in 1998. At December 31, 1998 the remaining balance on the
related party promissory note was $1,000,000. During January 1999, the Company
made the final principal payment of $1,000,000.
Net Income from Continuing Operations After Income Taxes. Net income from
continuing operations after income taxes was $2,169,579 in 1998 as compared to
$2,072,567 for 1997. The slight increase resulted from higher revenues offset by
increased general and administrative expenses and decreased gross profit
margins, as well as higher interest income and lower interest expense.
Discontinued Operations. In June 1998, due to continuing operating losses,
the Company decided to dispose of its wholly-owned subsidiary Prestressed
Products Incorporated. Accordingly, the Company has reclassified the operations
of Prestressed Products Incorporated as discontinued operations in the
accompanying financial statements. In June 1998, the Company accrued a
$1,950,000 charge (net of income tax benefit of $1,300,000), related to the
disposal of assets for the Prestressed Products business, which included a
provision of $1,350,000 for estimated operating losses during the phase-out
period. During the year ended December 31, 1998, $1,134,112 of the expected
losses were incurred (net of income tax benefit of $756,073). The cessation of
the Prestressed Products business is expected to be completed during the second
quarter 1999.
Net Loss. Net loss, after discontinued operations, for 1998 was $415,667
YEAR ENDED DECEMBER 31, 1997 COMPARED TO YEAR ENDED DECEMBER 31, 1996
Revenue and Backlog. Revenue increased 9.4% to $146.3 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.
Gross Profit. As a percentage of revenue, gross profit increased from 2.10%
in 1996 to 5.37% in 1997. The increase in the gross profit margin was the result
of decreased gross profit margins experienced during 1996 related to (i)
omission of costs from bid estimates (ii) difficulties assembling an adequate
skilled labor force due to physical location of a construction site (iii)
19
<PAGE>
erroneous assumptions at bid time regarding the Company's construction
productivity and (iv) inadequate field and corporate supervision.
General and Administrative Expenses. General and administrative expenses
increased from $3,065,657 for 1996 to $4,689,542 for 1997. The increase results,
in part, from the costs associated with the Company's wholly-owned ready-mix
concrete subsidiary, the Company's continued expansion in Utah and expansion
into white paving. The additional costs associated with the Company's wholly-
owned ready-mix concrete subsidiary and the continued expansion in Utah and
expansion into white paving amounted to approximately $887,000. 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 in 1996, 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 in 1996, due primarily to financing certain of
the property and equipment additions.
Net Income from Continuing Operations After Income Taxes. Net income from
continuing operations after taxes for 1997 was $2,072,567 compared to a net loss
from continuing operations after income taxes for 1996 of $(37,531). 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.
Discontinued Operations. In June 1998, the Company decided to dispose of
its wholly-owned subsidiary Prestressed Products Incorporated. Accordingly, the
Company has reclassified the operations of Prestressed Products Incorporated as
discontinued operations in the accompanying financial statements. The statements
of operations for the years ended December 31, 1996 and 1997 have been restated
and operating results of PPI are shown separately. During the years ended
December 31, 1996 and 1997, PPI incurred losses in the amounts of $47,697 and
$860,952, net of income tax benefits of $28,756 and $443,520. The cessation of
the Prestressed Products business is expected to be completed during the second
quarter 1999.
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 $134.0 million in 1996 to $187.0
million in 1998. 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>
FOR THE YEARS ENDED DECEMBER 31,
------------------------------------------------
1996 1997 1998
<S> <C> <C> <C>
Cash Provided By (Used in) Operating Activities....... $ (3,090,919) $ 7,545,827 $ 10,889,235
Cash Provided By (Used in) Investing Activities....... (579,183) (4,432,322) 331,646
Cash Used in Financing Activities..................... (247,283) (1,738,860) (3,043,020)
</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.
20
<PAGE>
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 $7.5 million,
primarily the result of net income of $1.2 million, depreciation and
amortization of $1.3 million, a decrease in accounts receivable of $2.8 million,
an increase in net billings in excess of costs of $3.1 million, $.4 million
increase in deferred income tax payable, offset by a decrease in accounts
payable of $1.3 million.
Cash provided by operating activities during 1998 amounted to $10.9
million, primarily the result of a decrease in accounts receivable of $8.7
million, depreciation and amortization of $1.8 million, an increase in net
billings in excess of costs of $4.8 million, an increase in accrued liabilities
of $1.3 million, offset by a decrease in accounts payable of $4.6 million and an
increase in prepaid expenses and other of $.8 million and a net loss of $.4
million.
Cash used in investing activities during 1996 amounted to $.6 million,
primarily the result of the purchase of property and equipment of $1.7 million
and the investment in and advances to Prestressed Products Incorporated of $.2
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 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 $4.4 million
related primarily to an increase in net assets of discontinued operations of
$2.6 million and the purchase of property and equipment of $1.8 million.
Cash provided by investing activities during 1998 amounted to $.3 million
related primarily to the decrease in related party note receivable of $.3
million, a decrease in net assets of discontinued operations of $2.5 million and
proceeds from the sale of property and equipment in the amount of $.2 million,
offset by the increase in restricted cash of $2.0 million and the purchase of
property and equipment of $.6 million. The aforementioned note receivable
related party was due from Paul R. Lewis, an officer and director of the
Company.
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 plus $.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. Cash used in
financing activities during 1998 amounted to $3.0 million including a total of
$1.5 million of prepayments of a loan from a related party and repayments of
notes payable and capital lease obligations in the amount of $1.5 million. The
aforementioned note payable related party was due to a principal shareholder of
the Company, the Richard C. Lewis Family Revocable Trust I.
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, 1998, 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, 1998, 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, 1999.
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.
21
<PAGE>
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
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 adopted this accounting standard on January 1, 1998.
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 has completed a comprehensive assessment of the internal
information systems and applications that will be impacted by the year 2000. The
Company expects to make the necessary revisions or upgrades to its systems to
render it year 2000 compliant. The Company's accounting software currently
utilizes a four digit year field. Attention is also being focused on compliance
efforts of key suppliers and customers. The Company could potentially experience
disruptions to some aspects of its various activities and operations as a result
of non-compliant systems utilized by the Company or unrelated third parties.
Contingency plans are therefore under development to mitigate the extent of any
such potential disruption to business operations. Based on preliminary
information, the costs to the Company of addressing potential year 2000 issues
are not expected to have a material adverse impact on the Company's consolidated
results of operations or financial position. There can be no assurance that the
efforts or the contingency plans related to the Company's systems, or those of
the other entities relied upon will be successful or that any failure to
convert, upgrade or appropriately plan for contingencies would not have a
material adverse effect on the Company.
KNOWN AND ANTICIPATED FUTURE TRENDS AND CONTINGENCIES
The Company has increasingly drawn the interest and attention of an
AFL-CIO-funded organization known as the Building Trades Organizing Project
("BTOP"). The stated purpose of the BTOP is to organize the workforce of
non-union companies. Notwithstanding its stated purpose and the fact that it
currently owns 263 shares of the Company's Common Stock, the actions taken by
the BTOP relative to the Company have generally been contrary to the interests
of the Company's other shareholders. These actions include hindering the
Company's productivity by organizing pickets on certain Nevada job sites, filing
unfounded unfair labor charges (to date the Company has successfully prevailed
on all charges brought against the Company) and interfering with the work of
subcontractors and suppliers. In addition, the BTOP has issued press releases
wherein the facts were incomplete, mistaken, misleading, blatantly false or
stated erroneous conclusions. Unfortunately, all too frequently the wire
services have mistakenly attributed to the Company statements made in the BTOP
press releases. On one occasion, this caused a dramatic decline in the value of
the Company's Common Stock. The BTOP is now seeking to inhibit the Company's
ongoing operations by requesting that all transactions with related parties be
subject to shareholder approval. The BTOP has also had direct contact with two
of the Company's customers, the Nevada Department of Transportation and the New
Mexico State Highway and Transportation Department, with the apparent intent of
restricting the Company's contractual rights and its ability to continue to
obtain future contracts. The Company has successfully minimized the impact of
the BTOP's actions on the construction projects, but has, as yet, been unable to
prevent BTOP from issuing damaging press releases. It can be
22
<PAGE>
anticipated that, barring successful legal action, if any, by the Company the
BTOP will continue to use the same tactics in dealing with the Company in the
future.
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 at all levels will continue to be the
primary source of funding for infrastructure work. One June 9, 1998, the
Transportation Equity Act for the 21st Century ("TEA 21") was signed into law.
This bill establishes a total budget authority of $215 billion over the six year
period 1998-2003. TEA 21 ensures that tax revenue deposited into the Highway
Trust Fund will be spent on transportation improvements by guaranteeing $165
billion for highways and $35 billion for transit and by further stipulating that
appropriators can spend trust fund dollars only on transportation. 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.
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
23
<PAGE>
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, 1998, 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,
1998, 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, 1998, 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, 1998, which is hereby incorporated
by reference.
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, 1996, 1997 and 1998.
(b) Reports on Form 8-K
There were no reports on Form 8-K filed during the fourth
quarter ended December 31, 1998.
(c) Exhibits
EXHIBIT
NO. TITLE
------- -----------------------------------------------------
1.01 Form of Underwriting Agreement with Spelman & Co.,
Inc. (1)
24
<PAGE>
EXHIBIT
NO. TITLE
------- ------------------------------------------------------------
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 (1)
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)
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)
25
<PAGE>
EXHIBIT
NO. TITLE
------- ------------------------------------------------------------
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)
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)
26
<PAGE>
EXHIBIT
NO. TITLE
------- ------------------------------------------------------------
10.50 Lease Agreement with CIT Group (2)
10.51 CAT Financial Installment Sale Contract (3)
10.52 CAT Financial Installment Sale Contract (3)
10.53 CAT Financial Installment Sale Contract (3)
10.54 CAT Financial Installment Sale Contract (3)
10.55 CAT Financial Installment Sale Contract (3)
10.56 Escrow Settlement Documents (3)
10.57 Promissory Note executed by General Electric Capital
Corporation (3)
10.58 Promissory Note executed by General Electric Capital
Corporation (3)
10.59 Promissory Note executed by General Electric Capital
Corporation (3)
10.60 Promissory Note executed by General Electric Capital
Corporation (3)
10.61 Promissory Note executed by Nevada State Bank (3)
10.62 KDC Sales Contract (3)
10.63 Lease Agreement with CIT (3)
10.64 Lease Agreement with CIT (3)
10.65 Contract between Registrant and Utah Department of
Transportation (3)
10.66 Contract between Registrant and Clark County, Nevada (3)
10.67 Contract between Registrant and New Mexico State Highway and
Transportation Department (3)
10.68 Contract between Registrant and Salt Lake City Corporation
(3)
10.69 Contract between Registrant and Utah Department of
Transportation (3)
10.70 Contract between Registrant and Arizona Department of
Transportation (3)
10.71 Contract between Registrant and Nevada Department of
Transportation (3)
10.72 Employment and Indemnification Agreements with Mr. Nelson
(3)
10.73 Employment and Indemnification Agreements with Mr. Terril
(3)
10.74 Employment and Indemnification Agreements with Mr. Lewis (3)
10.75 Employment and Indemnification Agreements with Mr. Larson
(3)
10.76 Employment and Indemnification Agreements with Mr. Burnell
(3)
10.77 Lease Agreement with Banc One Leasing Corp.
10.78 Lease Agreement with Banc One Leasing Corp.
10.79 Lease Agreement with Banc One Leasing Corp.
10.80 Lease Agreement with US Bancorp.
10.81 Security Agreement with Associates Commercial Corporation
10.82 Lease Agreement with Caterpillar Financial Services
10.83 Contract between Registrant and Clark County, Nevada
10.84 Contract between Registrant and Arizona Department of
Transportation
10.85 Contract between Registrant and New Mexico State Highway and
Transportation Department
27
<PAGE>
EXHIBIT
NO. TITLE
------- ------------------------------------------------------------
10.86 Contract between Registrant and New Mexico State Highway and
Transportation Department
10.87 Contract between Registrant and New Mexico State Highway and
Transportation Department
10.88 Joint Venture Agreement between Registrant and R.E. Monks
Construction Co.
10.89 Contract between Meadow Valley Contractors, Inc./R.E. Monks
Construction Co. (JV) and Arizona Department of
Transportation
10.90 Contract between the Registrant and Utah Department of
Transportation
10.91 Contract between the Registrant and Clark County, Nevada
10.92 General Agreement of Indemnity between the Registrant and
Liberty Mutual Insurance Company
10.93 Employment Agreement with Mr. Larson
10.94 Lease Agreement between the Registrant and Ken Nosker
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 BDO Seidman, LLP (Meadow Valley Corporation and
Meadow Valley Contractors, Inc.)(1)
27 Financial Data Schedule
_____________
(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.
(3) Incorporated by reference to the Company's December 31, 1997 Annual Report
on Form 10-K
28
<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.
MEADOW VALLEY CORPORATION
/s/ Bradley E. Larson
---------------------------------------
Bradley E. Larson
President and Chief Executive Officer
Date: March 15, 1999
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.
/s/ Bradley E. Larson /s/ Gary W. Burnell
- ------------------------------------- ---------------------------------------
Bradley E. Larson, Gary W. Burnell,
Director, President and Vice President, Treasurer and
Chief Executive Officer Chief Financial Officer
Date: March 15, 1999 Date: March 15, 1999
/s/ Kenneth D. Nelson /s/ Paul R. Lewis
- ------------------------------------- ---------------------------------------
Kenneth D. Nelson, Paul R. Lewis,
Director, Chief Administrative Director and Chief Operating Officer
Officer and Vice President Date: March 15, 1999
Date: March 15, 1999
/s/ Alan A. Terril /s/ Gary A. Agron
- ------------------------------------- ---------------------------------------
Alan A. Terril, Gary A. Agron,
Director and Vice President - Director
Nevada Operations Date: March 15, 1999
Date: March 15, 1999
/s/ Charles E. Cowan /s/ Julie L. Bergo
- ------------------------------------- ---------------------------------------
Charles E. Cowan, Julie L. Bergo
Director Secretary and Principal Accounting
Date: March 15, 1999 Officer
Date: March 15, 1999
29
<PAGE>
INDEX TO FINANCIAL STATEMENTS
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
<TABLE>
<S> <C>
Independent Certified Public Accountants' Report
.............................................................. F-2
Consolidated Balance Sheets at December 31, 1997 and 1998
.............................................................. F-3
Consolidated Statements of Operations for the years ended
December 31, 1996, 1997, and 1998............................. F-4
Consolidated Statements of Changes in Stockholders'
Equity for the years ended December 31, 1996, 1997 and 1998... F-5
Consolidated Statements of Cash Flows for the years ended
December 31, 1996, 1997 and 1998.............................. 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, 1997 and 1998, and the related
consolidated statements of operations, changes in stockholders' equity and cash
flows for each of the years ended December 31, 1996, 1997 and 1998. 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, 1997 and 1998, and the
consolidated results of their operations, and cash flows for each of the years
ended December 31, 1996, 1997 and 1998, in conformity with generally accepted
accounting principles.
BDO Seidman, LLP
Los Angeles, California
February 17, 1999
F-2
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31,
Assets 1997 1998
-------------- ------------
<S> <C> <C>
Current Assets:
Cash and cash equivalents (Notes 1 and 2).................................... $ 2,815,164 $ 10,993,025
Restricted cash (Notes 1, 2 and 17).......................................... 1,719,768 3,678,685
Accounts receivable, net (Notes 1, 3 and 17)................................. 24,142,358 15,434,491
Prepaid expenses and other................................................... 891,359 1,858,184
Note receivable - related party (Note 11).................................... 257,575 -
Note receivable - other (Note 10)............................................ 2,009 2,386
Costs and estimated earnings in excess of billings on uncompleted
contracts (Note 4)......................................................... 3,913,475 3,850,619
------------- --------------
Total Current Assets................................................... 33,741,708 35,817,390
Property and equipment, net (Notes 1, 5, 8, 11 and 21)............................ 9,026,751 10,995,846
Refundable deposits............................................................... 127,736 191,433
Note receivable - other (Note 10)................................................. 209,264 206,421
Goodwill, net (Note 1)............................................................ 1,740,821 1,660,792
Tradename, net (Note 1)........................................................... 12,177 -
Net assets of discontinued operations............................................. 2,879,305 425,181
------------- --------------
Total Assets...................................................... $ 47,737,762 $ 49,297,063
============== ===============
Liabilities and Stockholders' Equity:
Current Liabilities:
Note payable - related party (Notes 11 and 21)............................... $ 500,000 $ -
Notes payable - other (Notes 8 and 21)....................................... 818,846 1,145,621
Obligations under capital leases (Note 13)................................... 405,204 678,562
Accounts payable (Notes 6 and 11)............................................ 18,371,357 13,797,436
Accrued liabilities (Notes 7 and 11)......................................... 1,842,860 3,091,362
Billings in excess of costs and estimated earnings on uncompleted
contracts (Note 4)........................................................... 6,650,891 11,343,995
------------- --------------
Total Current Liabilities.............................................. 28,589,158 30,056,976
Deferred income taxes (Notes 1 and 12)............................................ 412,561 789,727
Obligations under capital leases (Note 13......................................... 973,847 2,031,316
Note payable - related party (Notes 11 and 21).................................... 2,000,000 1,000,000
Notes payable - other (Notes 8 and 21)............................................ 2,873,812 2,946,327
------------- --------------
Total Liabilities........................................................ 34,849,378 36,824,346
------------- --------------
Commitments and contingencies (Notes 9, 11, 13 and 15)
Stockholders' Equity:
Preferred stock - $.001 par value; 1,000,000 shares authorized, none issued
and outstanding (Note 14)...................................................... - -
Common stock - $.001 par value; 15,000,000 shares authorized, 3,601,250
issued and outstanding (Notes 14 and 18)....................................... 3,601 3,601
Additional paid-in capital...................................................... 10,943,569 10,943,569
Capital adjustments............................................................. (799,147) (799,147)
Retained earnings............................................................... 2,740,361 2,324,694
------------- --------------
Total Stockholders' Equity............................................... 12,888,384 12,472,717
------------- --------------
Total Liabilities and Stockholders' Equity............................... $ 47,737,762 $ 49,297,063
============= ==============
</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,
-------------------------------------------------------------
1996 1997 1998
-------------------------------------------------------------
<S> <C> <C> <C>
Revenue (Note 17)........................................... $ 133,723,645 $ 146,273,286 $ 187,036,077
Cost of revenue (Note 11)................................... 130,913,060 138,411,314 177,591,846
---------------- ---------------- ----------------
Gross profit................................................ 2,810,585 7,861,972 9,444,231
General and administrative expenses (Note 11)............... 3,065,657 4,689,542 6,359,248
---------------- ---------------- ----------------
Income (loss) from operations............................... (255,072) 3,172,430 3,084,983
---------------- ---------------- ----------------
Other Income (Expense):
Interest income............................................. 741,270 666,397 856,191
Interest expense (Note 11).................................. (611,828) (624,048) (435,358)
Other income................................................ 95,220 20,679 86,203
---------------- ---------------- ----------------
224,662 63,028 507,036
---------------- ---------------- ----------------
Income (loss) from continuing operations before income taxes (30,410) 3,235,458 3,592,019
Income tax expense (Note 12)................................ (7,121) (1,162,891) (1,422,440)
---------------- ---------------- ----------------
Net income (loss) from continuing operations................ (37,531) 2,072,567 2,169,579
Discontinued operations (Note 20):
Loss from operations of Prestressed Products subsidiary,
net of income tax benefit of $28,756, $443,520 and
$423,497................................................. (47,697) (860,952) (635,246)
Estimated loss on disposal of net assets of Prestressed
Products subsidiary (net of income tax benefit of
$1,300,000), including $1,350,000 for operating losses
during phase-out period.................................. - - (1,950,000)
---------------- ---------------- ----------------
Net income (loss) (Note 18)................................. $ (85,228) $ 1,211,615 $ (415,667)
================ ================ ================
Basic net income (loss) per common share (Note 19):
Income (loss) from continuing operations.................. $ (.01) $ .58 $ .60
Loss from operations of Prestressed Products subsidiary... (.01) (.24) (.18)
Estimated loss on disposal of net assets of Prestressed
Products subsidiary...................................... - - (.54)
---------------- ---------------- ----------------
Basic net income (loss) per common share.................... $ (.02) $ .34 $ (.12)
================ ================ ================
Diluted net income (loss) per common share (Note 19):
Income (loss) from continuing operations................. $ (.01) $ .57 $ .60
Loss from operations of Prestressed Products subsidiary.. (.01) (.24) (.17)
Estimated loss on disposal of net assets of Prestressed
Products subsidiary..................................... - - (.54)
---------------- ---------------- ----------------
Diluted net income (loss) per common share.................. $ (0.2) $ .33 $ (.11)
================ ================ ================
Basic weighted average common shares outstanding
(Note 19)................................................. 3,601,250 3,601,250 3,601,250
================ ================ ================
Diluted weighted average common shares outstanding
(Note 19)................................................ 3,601,250 3,651,360 3,644,651
================ ================ ================
</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, 1996, 1997 AND 1998
<TABLE>
<CAPTION>
COMMON STOCK
-----------------------------
NUMBER OF
SHARES PAID-IN CAPITAL RETAINED
OUTSTANDING AMOUNT CAPITAL ADJUSTMENT EARNINGS
---------------- ------------ -------------- -------------- --------------
<S> <C> <C> <C> <C> <C>
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
Net loss for the year.......................... (415,667)
---------------- ------------ -------------- -------------- --------------
Balance at December 31, 1998................... 3,601,250 $ 3,601 $ 10,943,569 $ (799,147) $ 2,324,694
================ ============ ============== ============== ==============
</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,
--------------------------------------------------------
1996 1997 1998
----------------- ---------------- -----------------
<S> <C> <C> <C>
Increase (Decrease) in Cash and Cash Equivalents:
Cash flows from operating activities:
Cash received from customers...............................$ 122,322,752 $ 152,130,455 $ 200,534,004
Cash paid to suppliers and employees....................... (124,400,016) (143,994,944) (188,760,555)
Interest Received.......................................... 685,738 615,008 878,517
Interest paid.............................................. (642,344) (658,622) (488,474)
Income taxes paid.......................................... (1,057,049) (546,070) (1,274,257)
----------------- ----------------- -----------------
Net cash provided by (used in) operating activities...... (3,090,919) 7,545,827 10,889,235
----------------- ----------------- -----------------
Cash flows from investing activities:
Purchase of AKR Contracting tradename...................... (36,531) - -
Decrease (increase) in restricted cash..................... 1,213,972 (304,191) (1,958,917)
Collection of notes receivable - related party............. - - 257,575
Collection of note receivable - other...................... 876 1,184 2,466
Proceeds from sale of property and equipment............... 126,431 322,960 165,182
Proceeds from sale of rental real estate................... 16,866 - -
Purchase of property and equipment......................... (1,653,806) (1,819,960) (588,784)
Decrease (increase) in net assets of discontinued
operations.............................................. (246,991) (2,632,315) 2,454,124
----------------- ----------------- -----------------
Net cash provided by (used in) investing activities..... (579,183) (4,432,322) 331,646
----------------- ----------------- -----------------
Cash flows from financing activities:
Repayment of capital lease obligations..................... (124,333) (319,428) (645,534)
Repayment of notes payable - other......................... (122,950) (419,432) (897,486)
Repayment of note payable - related party.................. - (1,000,000) (1,500,000)
----------------- ----------------- -----------------
Net cash used in financing activities................. (247,283) (1,738,860) (3,043,020)
----------------- ----------------- -----------------
Net increase (decrease) in cash and cash equivalents............ (3,917,385) 1,374,645 8,177,861
Cash and cash equivalents at beginning of year.................. 5,357,904 1,440,519 2,815,164
================= ================= =================
Cash and cash equivalents at end of year........................$ 1,440,519 $ 2,815,164 $ 10,993,025
================= ================= =================
</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,
----------------------------------------------------------
1996 1997 1998
----------------- ---------------- -----------------
<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)....................................................$ (85,228) $ 1,211,615 $ (415,667)
Adjustments to reconcile net income to net cash provided by
(used in) operating activities:
Depreciation and amortization....................................... 763,886 1,277,764 1,849,628
Gain on sale of property and equipment.............................. (38,170) (24,890) (29,777)
Gain on sale of rental real estate.................................. (11,316) - -
Deferred income taxes payable....................................... (21,635) 399,951 377,166
Changes in Assets and Liabilities:
Accounts receivable............................................. (13,095,536) 2,770,489 8,685,541
Prepaid expenses and other...................................... (968,247) (152,550) (801,540)
Costs and estimated earnings in excess of billings on
uncompleted contracts.......................................... (1,005,150) (187,147) 62,856
Interest payable................................................ (30,516) (34,574) (53,116)
Accounts payable................................................ 8,644,352 (1,258,450) (4,573,921)
Accrued liabilities............................................. 767,429 100,100 1,301,618
Billings in excess of costs and estimated earnings on
uncompleted contracts......................................... 2,654,059 3,278,038 4,693,104
Interest receivable............................................. (55,532) (51,389) 22,326
Income tax receivable........................................... - 216,870 (228,983)
Income taxes payable............................................ (609,315) - -
----------------- ---------------- -----------------
Net cash provided by (used in) operating activities..................$ (3,090,919) $ 7,545,827 $ 10,889,235
----------------- ---------------- -----------------
</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) and Ready Mix, Inc. (RMI). 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. RMI is a producer and retailer of ready-mix concrete
operating in the Las Vegas metropolitan area. Formed by the Company, RMI
commenced operations in 1997.
Principles of Consolidation:
The accompanying consolidated financial statements include the accounts of
the Company and its wholly-owned subsidiaries MVC and RMI. 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 revenue and expenses during the reporting
period. Actual results could differ from those estimates.
Significant estimates are used when accounting for the percentage of
completion and the estimated gross profit on projects in progress, allowance for
doubtful accounts, depreciation and amortization, accruals, taxes, contingencies
and goodwill, which are discussed in the respective notes to the consolidated
financial statements.
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, 1997 and December 31, 1998 funds in the amount of
$1,719,768 and $3,678,685 were held in trust, in lieu of retention, on certain
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. At December 31, 1997 and December 31, 1998
the Company had established an allowance for potentially uncollectible accounts
receivable in the amounts of $35,441 and $59,178. During the years ended
December 31, 1996, 1997 and 1998 the Company incurred bad debt expense in the
amounts of $0, $35,441 and $59,273.
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 charged to
operations during the years ended December 31, 1996, 1997 and 1998 was $671,269,
$1,185,147 and $1,757,422. 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
At December 31, 1998, property and equipment with a net book value of
$6,799,459 were pledged as collateral for notes payable and capital lease
obligations.
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 each of the years ended December 31, 1996, 1997 and
1998 was $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, 1997 and 1998 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 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.
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, 1997 and 1998.
F-9
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
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") 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 for the year ended December 31, 1997, decreased by
$.01 over the calculations under APB Opinion No. 15. There was no effect on
prior years.
Reporting Comprehensive Income:
Statement of Financial Accounting Standard No. 130, "Reporting
Comprehensive Income," ("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 adopted this accounting
standard on December 15, 1997. There was no effect on the 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") 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 adopted this accounting standard on December 15, 1997. There was no
material effect on the financial position or results of operations.
Reporting on the Costs of Start-Up Activities:
Statement of Position 98-5, "Reporting on the Costs of Start-Up
Activities", ("SOP 98-5"), issued by the American Institute of Certified Public
Accountants is effective for years beginning after December 15, 1998. Early
adoption is permitted. SOP 98-5 requires that costs of start-up activities
should be expensed as incurred. The Company does not expect adoption of SOP 98-5
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. 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, 1997 and December 31, 1998, the
Company has uninsured cash, cash equivalents, and restricted cash in the amount
of $8,460,365 and $16,909,324.
3. ACCOUNTS RECEIVABLE:
Following is a summary of receivables at December 31, 1997 and December 31,
1998:
<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31,
1997 1998
------------ ------------
<S> <C> <C>
Contracts in progress....................... $ 16,328,688 $ 9,249,373
Contracts in progress - retention........... 5,344,958 2,627,812
Completed contracts......................... 29,361 10,063
Completed contracts - retention............. 138,163 412,310
Other trade receivables..................... 1,665,832 2,624,593
Other receivables........................... 670,797 569,518
------------ ------------
24,177,799 15,493,669
Less: Allowance for doubtful accounts....... (35,441) (59,178)
------------ ------------
$ 24,142,358 $ 15,434,491
============ ============
</TABLE>
4. 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,
1997 1998
-------------- --------------
<S> <C> <C>
Costs incurred on uncompleted contracts..... $ 244,707,543 $ 314,134,398
Estimated earnings to date.................. 12,772,635 17,538,432
-------------- --------------
257,480,178 331,672,830
Less: billings to date...................... (260,217,594) (339,166,206)
-------------- --------------
$ (2,737,416) $ (7,493,376)
============== ==============
</TABLE>
Included in the accompanying balance sheet under the following captions:
<TABLE>
<S> <C> <C>
Costs and estimated earnings in excess of billings on
uncompleted contracts ................................. $ 3,913,475 $ 3,850,619
Billings in excess of costs and estimated earnings on
uncompleted contracts.................................. (6,650,891) (11,343,995)
------------- --------------
$ (2,737,416) $ (7,493,376)
============= ==============
</TABLE>
F-11
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
5. PROPERTY AND EQUIPMENT:
Property and equipment consists of the following:
<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31,
1997 1998
-------------- --------------
<S> <C> <C>
Land................................................ $ 788,379 $ 827,206
Plant............................................... 1,576,294 2,804,757
Computer equipment.................................. 283,291 306,902
Equipment........................................... 5,849,024 7,746,895
Vehicles (Note 13).................................. 2,427,910 2,808,540
Office furniture and equipment...................... 45,816 50,311
Leasehold improvements.............................. 6,863 6,863
-------------- --------------
10,977,577 14,551,474
Accumulated depreciation............................ (1,950,826) (3,555,628)
-------------- --------------
$ 9,026,751 $ 10,995,846
============== ==============
</TABLE>
6. ACCOUNTS PAYABLE:
Accounts payable consist of the following:
<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31,
1997 1998
-------------- --------------
<S> <C> <C>
Trade............................................... $ 13,080,929 $ 10,027,339
Retentions.......................................... 5,290,428 3,770,097
============== ==============
$ 18,371,357 $ 13,797,436
============== ==============
</TABLE>
7. ACCRUED LIABILITIES:
Accrued liabilities consist of the following:
<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31,
1997 1998
-------------- --------------
<S> <C> <C>
Compensation......................................... $ 935,597 $ 1,275,775
Interest............................................. 79,143 26,027
Taxes................................................ 289,741 610,254
Insurance............................................ 373,801 534,699
Other................................................ 164,578 644,607
============== ==============
$ 1,842,860 $ 3,091,362
============== ==============
</TABLE>
F-12
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
8. NOTES PAYABLE - OTHER:
Notes payable - other consist of the following
<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31,
1997 1998
-------------- --------------
<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........................... $ 3,144,590 $ 2,330,458
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.............................. 548,068 476,330
Note payable, interest rate of 6.47% with monthly payments
of $13,216, due 11/20/00, collateralized by equipment............ - 285,160
Note payable, interest rate of 6.6% with monthly payments
of $19,613, due 1/1/03, collateralized by equipment.............. - 1,000,000
-------------- --------------
3,692,658 4,091,948
Less: current portion (818,846) (1,145,621)
-------------- --------------
$ 2,873,812 $ 2,946,327
============== ==============
</TABLE>
Following are maturities of long-term debt for each of the next 5 years:
<TABLE>
<S> <C>
1999............................ $ 1,145,621
2000............................ 1,098,996
2001............................ 811,854
2002............................ 693,613
2003............................ 310,655
Subsequent to 2003.............. 31,209
===========
$ 4,091,948
===========
</TABLE>
9. LINES OF CREDIT:
At December 31, 1998, the Company had available from a commercial bank a
$2,000,000 operating line of credit ("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%. At December 31,
1998, 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, 1998,
the Company was in compliance with all such covenants. The lines of credit
expires September 15, 1999.
10. NOTE RECEIVABLE - OTHER:
Note receivable - other consist of the following:
<TABLE>
<CAPTION>
December 31, December 31,
1997 1998
------------ ------------
<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........ $ 211,273 $ 208,807
Less: current portion.............................................. (2,009) (2,386)
------------ ------------
$ 209,264 $ 206,421
============ ============
</TABLE>
F-13
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
11. 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, 1997. During January 1998, the note receivable -
related party was paid in full.
Equipment:
During the years ended December 31, 1997 and 1998, the Company
purchased equipment used in the construction business from a related party in
the amounts of $2,500 and $295,000.
Professional Services:
During the years ended December 31, 1997 and 1998, a related party
rendered professional services to the Company in the amounts of $16,060 and
$10,904. During each of the years ended December 31, 1997 and 1998, the Company
paid outside board of directors a total of $5,000.
Subcontractor/Supplier:
Various related parties provided materials and equipment used in the
Company's construction business during the years ended December 31, 1996, 1997
and 1998, in the amounts of $246,051, $153,189 and $191,694. Included in
accounts payable at December 31, 1997 and 1998 are amounts due to related
parties, in the amount of $5,495 and $1,114.
Royalties:
During the years ended December 31, 1997 and 1998, the Company paid
various related parties mining royalties in the amounts of $76,392 and $186,949.
Included in accounts payable at December 31, 1997 and 1998 are amounts due to
related parties, in the amount of $6,810 and $10,424.
Accrued Interest:
During the years ended December 31, 1996, 1997 and 1998, the Company
incurred interest expense in the amounts of $438,699, $412,842 and $243,322
related to notes payable to a principal stockholder. Included in accrued
liabilities at December 31, 1997 and December 31, 1998 are amounts due to
related parties, in the amounts of $61,644 and $26,027. Included in accounts
receivable at December 31, 1997 is interest due from a related party in the
amount of $15,455. During January 1998, the accrued interest receivable in the
amount of $15,793 was paid in full.
Note payable - related party:
<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31,
1997 1998
------------ ------------
<S> <C> <C>
12.5% note payable from a related party, due October 16, 2000, due
in equal annual installments of $1,000,000 plus accrued interest....... $ 2,500,000 $ 1,000,000
Less: current portion.................................................. (500,000) -
------------ ------------
$ 2,000,000 $ 1,000,000
============ ============
</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 $840. 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, 1996, 1997 and 1998 amounted to $9,600, $9,600 and
$10,040, respectively.
F-14
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
11. RELATED PARTY TRANSACTIONS (CONTINUED):
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. The lease terminates January 31,
1999 under the plan to discontinue operations of PPI. Rent expense under the
lease for the years ended December 31, 1996, 1997 and 1998 amounted to $15,000,
$30,000 and $42,369.
12. INCOME TAXES:
The provisions for income taxes (benefit) from continuing operations
consist of the following:
<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
-------------------------------------------
1996 1997 1998
----------- ------------ ------------
<S> <C> <C> <C>
Current:
Federal................................. $ 28,756 $ 669,566 $ 932,032
State................................... - 93,374 113,242
----------- ------------ ------------
- 762,940 1,045,274
Deferred..................................... (21,635) 399,951 377,166
=========== ============ ============
$ 7,121 $ 1,162,891 $ 1,422,440
=========== ============ ============
</TABLE>
The Company's deferred tax liability consists of the following, all of
which is long-term in nature:
<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------------
1997 1998
------------- -------------
<S> <C> <C>
Deferred tax asset:
Other....................................... $ 13,822 $ 34,107
Deferred tax liability:
Depreciation................................ (426,383) (823,834)
------------- -------------
Net deferred tax liability....................... $ (412,561) $ (789,727)
============= =============
</TABLE>
For the years ended December 31, 1996, 1997 and 1998, the effective tax
rate differs from the federal statutory rate primarily due to state income
taxes.
13. COMMITMENTS:
The Company is currently leasing office space in Phoenix, Arizona under
a non-cancelable operating lease agreement expiring in December 2000. During
December 1998, the Company amended the original lease. The amended lease
agreement provides for monthly payments of $6,998 through December 31, 1999 and
$7,431 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 $44,481, $56,576 and $66,117
for the years ended December 31, 1996, 1997 and 1998.
F-15
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
13. COMMITMENTS (CONTINUED):
The Company leases equipment under operating leases expiring on various
years through 2003, Minimum future rental payments under non-cancelable
operating leases having remaining terms in excess of one year as of December 31,
1998 for each of the next five years in aggregate are:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, AMOUNT
--------------------------------------------------------------------
<S> <C>
1999........................................... $ 2,170,064
2000........................................... 2,171,319
2001........................................... 1,867,775
2002........................................... 998,673
2003........................................... 496,448
---------------
Total minimum payments $ 7,704,279
===============
</TABLE>
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, 1997 and
1998, the total commitments, excluding benefits and incentives amount to
$1,582,500 and $1,011,250.
The Company is the lessee of vehicles and equipment under capital
leases expiring in various years through 2005. 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 1997 and 1998 was $298,283 and $533,008. At December 31,
1997 and 1998, property and equipment included $1,401,948 and $2,785,777, net of
accumulated depreciation, of vehicles and equipment under capital leases.
Minimum future lease payments under capital leases as of December 31,
1998 for each of the next five years and in aggregate are:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, AMOUNT
----------------------------------------------------------------------
<S> <C>
1999........................................... $ 767,480
2000........................................... 717,349
2001........................................... 544,523
2002........................................... 362,442
2003........................................... 241,743
Subsequent to 2003............................. 260,632
--------------
Total minimum payments......................... 2,894,169
Less: executory costs.......................... (37,057)
--------------
Net minimum lease payments..................... 2,857,112
Less: amount representing interest............. (147,234)
--------------
Present value of net minimum lease payment .... $ 2,709,878
==============
</TABLE>
14. 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)
14. 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 twelve months from the date of
the offering and for a period of four years thereafter.
15. 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.
The Company is party to a legal action taken by the Nevada Airport
Authority/Clark County that will result in the Company repairing or replacing
certain items related to a completed contract. The items which are being
requested to be repaired or replaced are related to the past performance of a
subcontractor and are subject to indemnity and hold harmless obligations by the
subcontractor to the Company. The Company has estimated the costs related to the
replacement to be approximately $450,000, which may initially be required to be
paid by the Company. Under the indemnity and hold harmless obligations, the
Company expects to recover all costs incurred.
16. 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 years ended December 31, 1996, the Company financed the
purchase of construction vehicles and equipment in the amount of $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 years ended December 31, 1997 and 1998, the Company financed
the purchase of property, plant and equipment in the amount of $3,658,608 and
$3,273,137.
F-17
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
17. SIGNIFICANT CUSTOMERS:
For the years ended December 31, 1996, 1997 and 1998, the Company
recognized a significant portion of its revenue from four Customers (shown as an
approximate percentage of total revenue):
<TABLE>
<CAPTION>
FOR THE YEARS ENDED DECEMBER 31,
----------------------------------------------------------
1996 1997 1998
------------------- ------------------ ------------------
<S> <C> <C> <C>
A...................................................... 23.7% 27.8% 29.9%
B...................................................... 41.3% 33.0% 12.5%
C...................................................... - - 8.2%
D...................................................... - 7.6% 24.3%
</TABLE>
At December 31, 1997 and December 31 ,1998, amounts due from the
aforementioned Customers included in restricted cash and accounts receivables,
are as follows:
<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------------------
1997 1998
------------------ ------------------
<S> <C> <C>
A..................................................... $ 4,276,679 $ 8,369,999
B..................................................... 13,735,567 1,805,712
C..................................................... 2,936,029 1,646,442
D..................................................... 112,173 1,709,294
</TABLE>
18. 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 AVERAGE
SHARES PRICE PER SHARE
--------------------- -------------------------
<S> <C> <C>
Outstanding December 31, 1996........................................... 478,925 $5.87
Granted............................................................ 80,000 5.87
Forfeited......................................................... (34,900) 5.87
---------------------
Outstanding December 31, 1997........................................... 524,025 5.87
Granted............................................................ 144,350 5.28
Forfeited.......................................................... (46,300) 5.28
---------------------
Outstanding December 31, 1998........................................... 622,075 5.43
=====================
</TABLE>
F-18
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
18. STOCK OPTION PLAN (CONTINUED):
Information relating to stock options at December 31, 1998 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>
$6.25 199,500 10 $6.25 199,500 $6.25
$4.375 to $5.41 200,025 10 5.36 133,350 5.36
$5.31 80,000 10 5.31 26,667 5.31
$5.875 142,550 10 5.875 - -
- --------------------------------- ----------- ----------------- --------------- ---------- ----------------------
$4.375 to $6.25 622,075 10 $5.43 359,517 $5.43
================================= =========== ================= =============== ========== ======================
</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 years ended December 31, 1996, 1997 and 1998. 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,
1996, 1997 and 1998 would have been reduced to the proforma amounts presented
below:
<TABLE>
<CAPTION>
1996 1997 1998
----------------- ----------------- -----------------
<S> <C> <C> <C>
Net income (loss)
As reported..................................... $ ( 85,228) $ 1,211,615 $ (415,667)
Proforma........................................ (179,877) 989,003 (933,371)
Net income (loss) per share
As reported..................................... $ (.02) $ .34 $ (.12)
Proforma........................................ (.05) .26 (.24)
</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 1996, 1997 and 1998: expected life of options
of 5 years, expected volatility of 48.65%, 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 1996, 1997 and 1998 approximated $1.23, $1.01 and $1.44.
19. BASIC EARNINGS (LOSS) PER SHARE:
The Company's basic net income (loss) per share at December 31, 1996,
1997 and 1998 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 upon 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.
F-19
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
19. BASIC EARNINGS (LOSS) PER SHARE (CONTINUED):
The Company's diluted net income per common share at December 31, 1998
includes 43,401 common shares that would be issued upon exercise of outstanding
stock options. Options to purchase 199,500 at $6.25 per share and options to
purchase 142,550 at $5.875 per share were outstanding during 1998, 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.
20. DISCONTINUED OPERATIONS:
In June 1998, the Company adopted a formal plan ( the "plan") to
discontinue the operations of Prestressed Products Incorporated ("PPI"). The
plan included the completion of approximately $2.8 million of uncompleted
contracts and the disposition of approximately $1.2 million of equipment.
Accordingly, the Company has reclassified the operations of PPI as discontinued
operations in the accompanying statements of operations. The Company recorded an
estimated loss of $1,950,000 (net of income tax benefit of $1,300,000), related
to the disposal of assets for PPI, which included a provision of $1,350,000 for
estimated operating losses during the phase-out period. During the year ended
December 31, 1998, $1,134,112 of the expected losses were incurred (net of
income tax benefit of $756,073).
Operating results of PPI for the six months ended June 30, 1998 are
shown separately in the accompanying statement of operations. The statements of
operations for the years ended December 31, 1996 and 1997 have been restated and
operating results of PPI are also shown separately.
The revenue of PPI for the years ended December 31, 1996, 1997 and 1998
were $0, $3,706,109 and $5,419,036. These amounts are not included in revenue in
the accompanying statements of operations.
The accompanying consolidated balance sheets as of December 31, 1997 and
December 31, 1998, have been restated to reflect the net liabilities and the
estimated loss as a single amount as follows:
<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------------------
1997 1998
------------------ -------------------
<S> <C> <C>
Current assets............................... $ 3,020,023 $ 1,204,192
Non-current assets........................... 1,184,717 481,331
Liabilities.................................. (1,325,435) (444,454)
------------------ -------------------
Net liabilities.......................... 2,879,305 1,241,069
Estimated loss on disposition................ - (815,888)
------------------ -------------------
Net liabilities of discontinued operations... $ 2,879,305 $ 425,181
================== ===================
</TABLE>
21. SUBSEQUENT EVENTS:
During January 1999, the Company made the final principal payment on
the $10.0 million promissory note (original 1994 promissory note balance)
totaling $1.0 million to the Kim A. Lewis Survivors Trust and the Richard C.
Lewis Marital Trust, each of which was created pursuant to the Richard C. Lewis
Family Revocable Trust I.
During January 1999, the Company made interest payments totaling
$27,397, related to the $10 million promissory note (original 1994 promissory
note balance), to the Kim A. Lewis Survivors Trust and the Richard C. Lewis
Marital Trust, each of which was created pursuant to the Richard C. Lewis Family
Revocable Trust I.
During January 1999, the Company financed the purchase of equipment in
the amount of $365,940. The note payable has a 6.96% interest rate with monthly
payments of $7,239, due January 2004.
F-20
<PAGE>
MEADOW VALLEY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
21. SUBSEQUENT EVENTS (CONTINUED):
During February 1999, the Company financed the purchase of equipment in
the amount of $278,250. The note payable has a 7.15% interest rate with monthly
payments of $5,529, due February 2004.
During February 1999, the Company renegotiated a note payable reducing
the interest rate from 10% to 8.5%, effective February 4, 1999. At December 31,
1998, the balance on the note payable was $234,204.
22. OTHER INFORMATIVE DISCLOSURES:
Ready Mix, Inc., (a wholly-owned subsidiary), manufactures and
distributes ready mix concrete in Las Vegas, NV, and targets prospective
customers 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 $2 million line of credit, notes payable and operating leases, the
Company intends for RMI to operate from two or more sites using at least 40
mixer trucks.
The following is a summary of the subsidiary's 1997 and 1998 revenue,
property and equipment and total assets:
<TABLE>
<CAPTION>
1997 1998
------------------ --------------------
<S> <C> <C>
Revenue.........................................$ 9,498,757 $ 15,156,886
Property and equipment, net..................... 2,453,144 2,291,170
Total assets.................................... 4,615,940 5,091,32
</TABLE>
<PAGE>
EXHIBIT 10.77
LEASE SCHEDULE NO. 1000065543 FINANCING LEASE
----------
Master Lease Agreement dated April 24, 1998
Lessor: Banc One Leasing Corporation
Lessee: MEADOW VALLEY CONTRACTORS, INC.
1. GENERAL. This Lease Schedule is signed and delivered under the Master Lease
Agreement identified above, as amended from time to time ("Master Lease"),
between Lessee and Lessor. Capitalized terms defined in the Master Lease will
have the same meanings when used in this Schedule.
2. FINANCING. Lessor finances for Lessee, and Lessee finances with Lessor, all
of the property ("Equipment") described below or in Schedule A-1 attached hereto
(and Lessee represents that all Equipment is new unless specifically identified
as used):
3. AMOUNT FINANCED. $256,320.00
4. FINANCING TERM. The Lease Term of this Schedule shall be Sixty (60) months.
The Lease Term begins on the Commencement Date and continues for the number of
months after the Commencement Date as stated above. The Acceptance Date is the
date that Lessor accepts this Schedule as stated below Lessor's signature. The
Commencement Date is the 24th day of the month in which the Acceptance Date
occurs.
5. INSTALLMENT PAYMENTS. As financing for the Equipment, Lessee shall pay to
Lessor all amounts stated below on the due dates stated below. There shall be
added to each installment payment all applicable Taxes as in effect from time to
time.
MONTHLY INSTALLMENT PAYMENT (excluding Taxes): $5,115.45
FREQUENCY & TIMING OF INSTALLMENT PAYMENTS: monthly in arrears
NUMBER OF INSTALLMENT PAYMENTS: Sixty (60)
INSTALLMENT PAYMENT DUE DATES: The first installment payment shall be paid
one month from the Commencement Date and all subsequent installment
payments shall be paid on the same day of each month thereafter.
SET-UP/FILING FEE: $200.00 which shall be paid on the Commencement Date.
SECURITY DEPOSIT: $0.00 which shall be paid on the Commencement Date.
6. SECURITY INTEREST. This Schedule is intended to be a secured debt financing
Transaction, not a true lease. See paragraph 7 below regarding Lessee's
ownership of the Equipment. As collateral security for payment and performance
of all Secured Obligations (defined in Paragraph 8 below) and to induce Lessor
to extend credit from time to time to Lessee (under the Lease or otherwise),
Lessee hereby grants to Lessor a first priority security interest in all of
Lessee's right, title and interest in the Equipment, whether now existing or
hereafter acquired, any sums specified in this Schedule as a "Security Deposit",
and in all Proceeds (defined in Paragraph 8 below). At its option, Lessor may
apply all or any part of any Security Deposit to cure any default of Lessee
under the Lease. If upon final termination of this Schedule, Lessee has
fulfilled all of the terms and conditions hereof, then Lessor shall pay to
Lessee upon Lessee's written request any remaining balance of the Security
Deposit for this Schedule, without interest.
Page 1 of 3
<PAGE>
7. TITLE TO EQUIPMENT; FIRST PRIORITY LIEN. Lessee represents, warrants and
agrees: that Lessee currently is the lawful owner of the Equipment; that good
and marketable title to the Equipment shall remain with Lessee at all times;
that Lessee has granted to Lessor a first priority security interest in the
Equipment and all Proceeds; and that the Equipment and all Proceeds are, and at
all times shall be, free and clear of any Liens other than Lessor's security
interest therein. Lessee at its sole expense will protect and defend Lessor's
first priority security interest in the Equipment against all claims and demands
whatsoever.
8. CERTAIN DEFINITIONS. "Secured Obligations" means (a) all payments and other
obligations of Lessee under or in connection with this Schedule, and (b) all
payments and other obligations of Lessee (whether now existing or hereafter
incurred) under or in connection with the Master Lease and all present and
future Lease Schedules thereto, and (c) all other leases, indebtedness,
liabilities and/or obligations of any kind (whether now existing or hereafter
incurred, absolute or contingent, direct or indirect) of Lessee to Lessor or to
any affiliate of either Lessor or BANC ONE CORPORATION. "Proceeds" means all
cash and non-cash proceeds of the Equipment including, without limitation,
proceeds of insurance, indemnities and/or warranties.
9. AMENDMENTS TO MASTER LEASE. FOR PURPOSES OF THIS SCHEDULE ONLY, Lessee and
Lessor agree to amend to the Master Lease as follows: (a) public liability or
property insurance as described in the second sentence of Section 8 will not be
required; (b) the definition of "Stipulated Loss Value" in clause (b) of Section
9 is deleted and replaced by Paragraph 10 below; (c) the text of Section 10 is
deleted in its entirety; (d) Subsections 23(a) and 23(c) and 23(d) are deleted;
(e) subsection 23(b) and the last sentence of section 4 will apply only
if an event of default occurs; and (f) all references in the Lease as it
relates to this Schedule to "Lessee" and "Lessor" shall be changed to "Borrower"
and "Lender" respectively.
10. STIPULATED LOSS VALUE. FOR PURPOSES OF THIS SCHEDULE ONLY, the "Stipulated
Loss Value" of any item of Equipment during its Lease Term equals the aggregate
of the following as of the date specified by Lessor: (a) all accrued and unpaid
interest, late charges and other amounts due under this Schedule and the Master
Lease to the extent it relates to this Schedule as of such specified date, plus
(b) the remaining principal balance due and payable by Lessee under this
Schedule as of such specified date, plus (c) interest on the amount described in
the foregoing clauses (a) and (b) at the Overdue Rate commencing with the
specified date; provided, that the foregoing calculation shall not exceed the
maximum amount which may be collected by Lessor from Lessee under applicable law
in connection with enforcement of Lessor's rights under this Schedule and the
Master Lease to the extent it relates to this Schedule.
11. LESSEE TO PAY ALL TAXES. FOR PURPOSES OF THIS SCHEDULE AND ITS EQUIPMENT
ONLY: Lessee shall pay any and all Taxes relating to this Schedule and its
Equipment directly to the applicable taxing authority; Lessee shall prepare and
file all reports or returns concerning any such Taxes as may be required by
applicable law or regulation (provided, that Lessor shall not be identified as
the owner of the Equipment in such reports or returns); and Lessee shall, upon
Lessor's request, send Lessor evidence of payment of such Taxes and copies of
any such reports or returns.
12. LESSEE'S ASSURANCES. Lessee irrevocably and unconditionally: (a) reaffirms
all of the terms and conditions of the Master Lease and agrees that the Master
Lease remains in full force and effect; (b) agrees that the Equipment is and
will be used at all times solely for commercial purposes, and not for personal,
family or household purposes; and (c) incorporates all of the terms and
conditions of the Master Lease as if fully set forth in this Schedule.
13. REPRESENTATIONS AND WARRANTIES: Lessee represents and warrants that: (a)
Lessee is a corporation, partnership or proprietorship duly organized, validly
existing and in good standing under the laws of the state of its organization
and is qualified to do business and is in good standing under the laws of each
other state in which the Equipment is or will be located; (b) Lessee has full
power, authority and legal right to sign, deliver and perform the Master Lease,
this Schedule and all related documents and such actions have been duly
authorized by all necessary corporate/partnership/proprietorship action; and (c)
the Master Lease, this Schedule and each related document duly signed and
delivered by Lessee and each
Page 2 of 3
<PAGE>
such document constitutes a legal, valid and binding obligation of Lessee
enforceable in accordance with its terms.
14. CONDITIONS. No lease of Equipment under this Schedule shall be binding on
Lessor, and Lessor shall have no obligation to purchase the Equipment covered
hereby, unless: (a) Lessor has received evidence of all required insurance; (b)
in Lessor's sole judgment, there has been no material adverse change in the
financial condition or business of Lessee or any guarantor; (c) Lessee has
signed and delivered to Lessor this Schedule, which must be satisfactory to
Lessor, and Lessor has signed and accepted this Schedule; (d) no change in the
Code or any regulation thereunder, which in Lessor's sole judgment would
adversely affect the economics to Lessor of the lease transaction, shall have
occurred or shall appear to be imminent; (e) Lessor has received, in form and
substance satisfactory to Lessor, such other documents and information as Lessor
shall reasonably request; and (f) Lessee has satisfied all other reasonable
conditions established by Lessor.
15. OTHER DOCUMENTS: EXPENSES: Lessee agrees to sign and deliver to Lessor any
additional documents deemed desirable by Lessor to effect the terms of the
Master Lease or this Schedule including, without limitation, Uniform Commercial
Code financing statements which Lessor is authorized to file with the
appropriate filing officers. Lessee hereby irrevocably appoints Lessor as
Lessee's attorney-in-fact with full power and authority in the place of Lessee
and in the name of Lessee to prepare, sign, amend, file or record any Uniform
Commercial Code financing statements or other documents deemed desirable by
Lessor to perfect, establish or give notice of Lessor's interests in the
Equipment or in any collateral as to which Lessee has granted Lessor a security
interest. Lessee shall pay upon Lessor's written request any actual
out-of-pocket costs and expenses paid or incurred by Lessor in connection with
the above terms of this section of the funding and closing of this Schedule.
16. PURCHASE ORDERS AND ACCEPTANCE OF EQUIPMENT. Lessee agrees that (i) Lessor
has not selected, manufactured, sold or supplied any of the Equipment, (ii)
Lessee has selected all of the Equipment and its suppliers, and (iii) Lessee has
received a copy of, and approved, the purchase orders or purchase contracts for
the Equipment. AS BETWEEN LESSEE AND LESSOR, LESSEE AGREES THAT: (A) LESSEE HAS
RECEIVED, INSPECTED AND APPROVED ALL OF THE EQUIPMENT; (B) ALL EQUIPMENT IS IN
GOOD WORKING ORDER AND COMPLIES WITH ALL PURCHASE ORDERS OR CONTRACTS AND ALL
APPLICABLE SPECIFICATIONS; (C) LESSEE IRREVOCABLY ACCEPTS ALL EQUIPMENT FOR
PURPOSES OF THE LEASE "AS-IS, WHERE-IS" WITH ALL FAULTS; AND (D) LESSEE
UNCONDITIONALLY WAIVES ANY RIGHT THAT IT MAY HAVE TO REVOKE ITS ACCEPTANCE OF
THE EQUIPMENT.
LESSEE HAS READ AND UNDERSTOOD ALL OF THE TERMS OF THIS SCHEDULE. LESSEE AGREES
THAT THERE ARE NO ORAL OR UNWRITTEN AGREEMENTS WITH LESSOR REGARDING THE
EQUIPMENT OR THIS SCHEDULE.
BANC ONE LEASING CORPORATION MEADOW VALLEY CONTRACTORS, INC.
(Lessor) (Lessee)
By: /s/ [SIGNATURE By: /s/ Gary W. Burnell
-------------------------------- ----------------------------------
Title: MGR, FUNDING Title: VP/CFO
----------------------------- -------------------------------
Acceptance Date: 4/24/98 Witness: /s/ Tortina M. Bunton
------------------- -----------------------------
Page 3 of 3
<PAGE>
EXHIBIT 10.78
LEASE SCHEDULE NO. 1000065542
FINANCING LEASE
Master Lease Agreement dated April 24, 1998
Lessor: Banc One Leasing Corporation
Lessee: MEADOW VALLEY CONTRACTORS, INC.
1. GENERAL. This Lease Schedule is signed and delivered under the Master Lease
Agreement identified above, as amended from time to time ("Master Lease"),
between Lessee and Lessor. Capitalized terms defined in the Master Lease will
have the same meanings when used in this Schedule.
2. FINANCING. Lessor finances for Lessee, and Lessee finances with Lessor, all
of the property ("Equipment") described below or in Schedule A-1 attached hereto
(and Lessee represents that all Equipment is new unless specifically identified
as used):
3. AMOUNT FINANCED. $1,091,685.00
4. FINANCING TERM. The Lease Term of this Schedule shall be Eighty-four (84)
months. The Lease Term begins on the Commencement Date and continues for the
number of months after the Commencement Date as stated above. The Acceptance
Date is the date that Lessor accepts this Schedule as stated below Lessor's
signature. The Commencement Date is the 24th day of the month in which the
Acceptance Date occurs.
5. INSTALLMENT PAYMENTS. As financing for the Equipment, Lessee shall pay to
Lesser all amounts stated below on the due dates stated below. There shall be
added to each installment payment all applicable Taxes as in affect from time to
time.
MONTHLY INSTALLMENT PAYMENT (excluding Taxes): $16,669.24
FREQUENCY & TIMING OF INSTALLMENT PAYMENTS: monthly in arrears
NUMBER OF INSTALLMENT PAYMENTS: Eighty-four (84)
INSTALLMENT PAYMENT DUE DATES: The first installment payment shall be
paid one month from the Commencement Date and all subsequent installment
payments shall be paid on the same day of each month thereafter.
SET-UP/FILING FEE: $200.00 which shall be paid on the Commencement Date.
SECURITY DEPOSIT: $0.00 which shall be paid on the Commencement Date.
6. SECURITY INTEREST. This Schedule is intended to be a secured debt financing
transaction, not a true lease. See Paragraph 7 below regarding Lessee's
ownership of the Equipment. As collateral security for payment and performance
of all Secured Obligations (defined in Paragraph 8 below) and to induce Lessor
to extend credit from time to time to Lessee (under the Lease or otherwise),
Lessee hereby grants to Lessor a first priority security interest in all of
Lessee's right, title and interest in the Equipment, whether now existing or
hereafter acquired, any sums specified in this Schedule as a "Security Deposit",
and in all Proceeds (defined in Paragraph 8 below). At its option, Lessor may
apply all or any part of any Security Deposit to cure any default of Lessee
under the Lease. If upon final termination of this Schedule, Lessee has
fulfilled all of the terms and conditions hereof, then Lessor shall pay to
Lessee upon Lessee's written request any remaining balance of the Security
Deposit for this Schedule, without interest.
Page 1 of 3
<PAGE>
7. TITLE TO EQUIPMENT; FIRST PRIORITY LIEN. Lease represents, warrants and
agrees: that Lessee currently is the lawful owner of the Equipment; that good
and marketable title to the Equipment shall remain with Lessee at all times;
that Lessee has granted to Lessor a first priority security interest in the
Equipment and all Proceeds; and that the Equipment and all Proceeds are, and at
all times shall be, free and clear of any Liens other than Lessor's security
therein. Lessee at its sole expense will protect and defend Lessor's first
priority security interest in the Equipment against all claims and demands
whatsoever.
8. CERTAIN DEFINITIONS. "Secured Obligations" means (a) all payments and other
obligations of Lessee under or in connection with this Schedule, and (b) all
payments and other obligations of Lessee (whether now existing or hereafter
incurred) under or in connection with the Master Lease and all present and
future Lease Schedules thereto, and (c) all other leases, indebtedness,
liabilities and/or obligations of any kind (whether now existing or hereafter
incurred, absolute or contingent, direct or indirect) of Lessee to Lessor or to
any affiliate of either Lessor or BANC ONE CORPORATION. "Proceeds" means all
cash and non-cash proceeds of the Equipment including, without limitation,
proceeds of insurance, indemnities and/or warranties.
9. AMENDMENTS TO MASTER LEASE. For purposes of this Schedule only, Lessee and
Lessor agree to amend the Master Lease as follows: (a) public liability or
property insurance as described in the second sentence of Section 8 will not be
required; (b) the definition of "Stipulated Loss Value" in clause (b) of Section
9 is deleted and replaced by Paragraph 10 below; (c) the text of Section 10 is
deleted in its entirety; (d) Subsections 23(a), 23(c) and 23(d) are deleted; (e)
subsection 23(b) and the last sentence of section 4 will apply only if an event
of default occurs; and (f) all references in the Lease as it relates to this
Schedule to "Lessee"and "Lessor" shall be changed to "Borrower" and "Lender"
respectively.
10. STIPULATED LOSS VALUE. For purposes of this Schedule only, the "Stipulated
Loss Value" of any item of Equipment during its Lease Term equals the aggregate
of the following as of the date specified by Lessor: (a) all accrued and unpaid
interest, late charges and other amounts due under this Schedule and the Master
Lease to the extent it relates to this Schedule as of such specified date, plus
(b) the remaining principal balance due and payable by Lessee under this
Schedule as of such specified date, plus (c) interest on the amount described in
the foregoing clauses (a) and (b) at the Overdue Rate commencing with the
specified date; provided, that the foregoing calculation shall not exceed the
maximum amount which may be collected by Lessor from Lessee under the
applicable law in connection with enforcement of Lessor's rights under this
Schedule and the Master Lease to the extent it relates to this Schedule.
11. LESSEE TO PAY ALL TAXES. For purposes of this Schedule and its Equipment
only: Lessee shall pay any and all Taxes relating to this Schedule and its
Equipment directly to the applicable taxing authority; Lessee shall prepare and
file all reports or returns concerning any such Taxes as may be required by
applicable law or regulation (provided, that Lessor shall not be identified as
the owner of the Equipment in such reports or returns); and Lessee shall, upon
Lessor's request, send Lessor evidence of payment of such Taxes and copies of
any such reports or returns.
12. LESSEE'S ASSURANCES. Lessee irrevocably and unconditionally: (a) reaffirms
all of the terms and conditions of the Master Lease and agrees that the Master
Lease remains in full force and effect; (b) agrees that the Equipment is and
will be used at all times solely for commercial purposes, and not for personal,
family or household purposes; and (c) incorporates all of the terms and
conditions of the Master Lease as if fully set forth in this Schedule.
13. REPRESENTATIONS AND WARRANTIES: Lessee represents and warrants that: (a)
Lessee is a corporation, partnership or proprietorship duly organized, validly
existing and in good standing under the laws of the state of its organization
and is qualified to do business and is in good standing under the laws of each
other state in which the Equipment is or will be located; (b) Lessee has full
power, authority and legal right to sign, deliver and perform the Master Lease,
this Schedule and all related documents and such actions have been duly
authorized by all necessary corporate/partnership/proprietorship action; and (c)
the Master Lease, this Schedule and each related document has been duly signed
and delivered by Lessee and each
Page 2 of 3
<PAGE>
such document constitutes a legal, valid and binding obligation of Lessee
enforceable in accordance with its terms.
14. CONDITIONS. No lease of Equipment under this Schedule shall be binding on
Lessor, and Lessor shall have no obligation to purchase the Equipment covered
hereby unless: (a) Lessor has received evidence of all required insurance; (b)
in Lessor's sole judgment, there has been no material adverse change in the
financial condition or business of Lessee or any guarantor; (c) Lessee has
signed and delivered to Lessor this Schedule, which must be satisfactory to
Lessor, and Lessor has signed and accepted this Schedule; (d) no change in the
Code or any regulation thereunder, which in Lessor's sole judgment would
adversely affect the economics to Lessor of the lease transaction, shall have
occurred or shall appear to be imminent; (e) Lessor has received, in form and
substance satisfactory to Lessor, such other documents and information as Lessor
shall reasonably request; and (f) Lessee has satisfied all other reasonable
conditions established by Lessor.
15. OTHER DOCUMENTS: EXPENSES: Lessee agrees to sign and deliver to Lessor any
additional documents deemed desirable by Lessor to effect the terms of the
Master Lease or this Schedule including, without limitation, Uniform Commercial
Code financing statements which Lessor is authorized to file with the
appropriate filing officers. Lessee hereby irrevocably appoints Lessor as
Lessee's attorney-in-fact with full power and authority in the place of Lessee
and in the name of Lessee to prepare, sign, amend, file or record any Uniform
Commercial Code financing statements or other documents deemed desirable by
Lessor to perfect, establish or give notice of Lessor's interests in the
Equipment or in any collateral as to which Lessee has granted Lessor a security
interest. Lessee shall pay upon Lessor's written request any actual
out-of-pocket costs and expenses paid or incurred by Lessor in connection with
the above terms of this section or the funding and closing of this Schedule.
16. PURCHASE ORDERS AND ACCEPTANCE OF EQUIPMENT. Lessee agrees that (i) Lessor
has not selected, manufactured, sold or supplied any of the Equipment, (ii)
Lessee has selected all of the Equipment and its suppliers, and (iii) Lessee has
received a copy of, and approved, the purchase orders or purchase contracts for
the Equipment. AS BETWEEN LESSEE AND LESSOR, LESSEE AGREES THAT: (A) LESSEE HAS
RECEIVED, INSPECTED AND APPROVED ALL OF THE EQUIPMENT; (B) ALL EQUIPMENT IS IN
GOOD WORKING ORDER AND COMPLIES WITH ALL PURCHASE ORDERS OR CONTRACTS AND ALL
APPLICABLE SPECIFICATIONS; (C) LESSEE IRREVOCABLY ACCEPTS ALL EQUIPMENT FOR
PURPOSES OF THE LEASE "AS-IS, WHERE-IS" WITH ALL FAULTS; AND (D) LESSEE
UNCONDITIONALLY WAIVES ANY RIGHT THAT IT MAY HAVE TO REVOKE ITS ACCEPTANCE OF
THE EQUIPMENT.
LESSEE HAS READ AND UNDERSTOOD ALL OF THE TERMS OF THIS SCHEDULE. LESSEE AGREES
THAT THERE ARE NO ORAL OR UNWRITTEN AGREEMENTS WITH LESSOR REGARDING THE
EQUIPMENT OR THIS SCHEDULE.
BANC ONE LEASING CORPORATION MEADOW VALLEY CONTRACTORS, INC.
(Lessor) (Lessee)
By: [SIGNATURE By: /s/ Gary W. Burnell
------------------------ ---------------------------
Title: MGR, FUND/NG Title: VP/CFO
--------------------- ------------------------
Acceptance Date: 4/24/98 Witness: Tortina M. Bunton
----------- ----------------------
Page 3 of 3
<PAGE>
EXHIBIT 10.79
LEASE SCHEDULE NO. 1000066385 FINANCING LEASE
----------
(Per Diem Interim Rent)
Master Lease Agreement dated April 24, 1998
Lessor: Banc One Leasing Corporation
Lessee: Meadow Valley Contractors, Inc.
1. GENERAL. This Lease Schedule is signed and delivered under the Master Lease
Agreement identified above, as amended from time to time ("Master Lease"),
between Lessee and Lessor. Capitalized terms defined in the Master Lease will
have the same meanings when used in this Schedule.
2. FINANCING. Lessor finances for Lessee, and Lessee finances with Lessor, all
of the property ("Equipment") described in Schedule A-1 attached hereto (and
Lessee represents that all Equipment is new unless specifically identified as
used):
3. AMOUNT FINANCED:
Equipment Cost: $349,592.00
Set-up/Filing Fee: $ 0.00
Miscellaneous: $ 0.00
Sales Tax: $ 0.00
Total: $349,592.00
-----------
4. FINANCING TERM. The Base Term of this Schedule shall be SIXTY(60) months
and the Base Term shall commence on 7/01/98 ("Commencement Date"). The total
Lease Term consists of the Interim Term plus the Base Term. The Interim Term
begins on the date that Lessor accepts this Schedule as stated below Lessor's
signature ("Acceptance Date") and continues up to the Commencement Date.
5. INSTALLMENT PAYMENTS/FEES. As financing for the Equipment, Lessee shall
pay to Lessor all amounts stated below on the due dates stated below. There
shall be added to each installment payment all applicable Taxes as in effect
from time to time.
(a) For the Interim Term, Lessee shall pay to Lessor on the Commencement Date
an amount equal to simple interest at 7.34% on $349,592 principal, only for the
number of days in the Interim Term.
(b) During the Base Term, Lessee shall pay to Lessor monthly installment
payments of principal and interest with each such periodic installment payment
being in the amount of $6,978.56. The first installment payment in the Base Term
in the amount of $6,978.56 (includes applicable tax) shall be paid in arrears
and all subsequent installment payments shall be paid on the same day of each
payment thereafter. The remaining principal balance and all accrued interest
shall be due and payable in full on the last day of the Lease Term.
(c) Lessee shall pay Lessor a Set-Up/Filing Fee as follows:
(1) $200.00 shall be paid on the Acceptance Date, or
(2) $ 0.00 has been included in the above Lessor's Cost of the Equipment.
PAGE 1
<PAGE>
(d) Security Deposit: $0.00. On the Acceptance Date, Lessee shall pay Lessor
said Security Deposit which shall be held in accordance with paragraph 6 below.
6. SECURITY INTEREST. This Schedule is intended to be a secured debt financing
transaction, not a true lease. See Paragraph 7 below regarding Lessee's
---
ownership of the Equipment. As collateral security for payment and performance
of all Secured Obligations (defined in Paragraph 8 below) and to induce Lessor
to extend credit from time to time to Lessee (under the Lease or otherwise),
Lessee hereby grants to Lessor a first priority security interest in all of
Lessee's right, title and interest in the Equipment, whether now existing or
hereafter acquired, any sums specified in this Schedule as a "Security Deposit",
and in all Proceeds (defined in Paragraph 8 below). At its option, Lessor may
apply all or any part of any Security Deposit to cure any default of Lessee
under the Lease. If upon final termination of this Schedule, Lessee has
fulfilled all of the terms and conditions hereof, then Lessor shall pay to
Lessee upon Lessee's written request any remaining balance of the Security
Deposit for this Schedule, without interest.
7. TITLE TO EQUIPMENT; FIRST PRIORITY LIEN. Lessee represents, warrants and
agrees: that Lessee currently is the lawful owner of the Equipment; that good
and marketable title to the Equipment shall remain with Lessee at all times;
that Lessee has granted to Lessor a first priority security interest in the
Equipment and all Proceeds; and that the Equipment and all Proceeds are, and at
all times shall be, free and clear of any Liens other than Lessor's security
interest therein. Lessee at its sole expense will protect and defend Lessor's
first priority security interest in the Equipment against all claims and demands
whatsoever.
8. CERTAIN DEFINITIONS. "Secured Obligations" means (a) all payments and other
obligations of Lessee under or in connection with this Schedule, and (b) all
payments and other obligations of Lessee (whether now existing or hereafter
incurred) under or in connection with the Master Lease and all present and
future Lease Schedules thereto, and (c) all other leases, indebtedness,
liabilities and/or obligations of any kind (whether now existing or hereafter
incurred, absolute or contingent, direct or indirect) of Lessee to Lessor or to
any affiliate of either Lessor or BANC ONE CORPORATION. "Proceeds" means all
cash and non-cash proceeds of the Equipment including, without limitation,
proceeds of insurance, indemnities and/or warranties.
9. AMENDMENT TO MASTER LEASE. For purposes of this Schedule only, Lessee and
Lessor agree to amend the Master Lease as follows: (a) public liability or
property insurance as described in the second sentence of Section 8 will not be
required; (b) the definition of "Stipulated Loss Value" in clause (b) of Section
9 is deleted and replaced by Paragraph 10 below; (c) the text of Section 10 is
deleted in its entirety; (d) Subsections 23(a) and 23(c) and 23(d) are deleted;
(e) subsection 23(b) and the last sentence of section 4 will apply only if an
event of default occurs; and (f) all references in the Lease as it relates to
this Schedule to "Lessee" and "Lessor" shall be changed to "Borrower" and
"Lender" respectively.
10. STIPULATED LOSS VALUE. For purposes of this Schedule only, the "Stipulated
Loss Value" of any item of Equipment during its Lease Term equals the aggregate
of the following as of the date specified by Lessor: (a) all accrued and unpaid
interest, late charges and other amounts due under this Schedule and the Master
Lease to the extent it relates to this Schedule as of such specified date, plus
(b) the remaining principal balance due and payable by Lessee under this
Schedule as of such specified date, plus (c) interest on the amount described in
the foregoing clauses (a) and (b) at the Overdue Rate commencing with the
specified date; provided, that the foregoing calculation shall not exceed the
maximum amount which may be collected by Lessor from Lessee under applicable law
in connection with enforcement of Lessor's rights under this Schedule and the
Master Lease to the extent it relates to this Schedule.
11. LESSEE TO PAY ALL TAXES. For purposes of this Schedule and its Equipment
only: Lessee shall pay any and all Taxes relating to this Schedule and its
Equipment directly to the applicable taxing authority; Lessee shall prepare and
file all reports or returns concerning any such Taxes as may be required by
PAGE 2
<PAGE>
applicable law or regulation (provided, that Lessor shall not be identified as
the owner of the Equipment in such reports or returns); and Lessee shall, upon
Lessor's request, send Lessor evidence of payment of such Taxes and copies of
any such reports or returns.
12. LESSEE'S ASSURANCES. Lessee irrevocably and unconditionally: (a)
reaffirms all of the terms and conditions of the Master Lease and agrees that
the Master Lease remains in full force and effect; (b) agrees that the
Equipment is and will be used at all times solely for commercial purposes, and
not for personal, family or household purposes; and (c) incorporates all of the
terms and conditions of the Master Lease as if fully set forth in this Schedule.
13. REPRESENTATIONS AND WARRANTIES; Lessee represents and warrants that: (a)
Lessee is a corporation, partnership or proprietorship duly organized, validly
existing and in good standing under the laws of the state of its organization
and is qualified to do business and is in good standing under the laws of each
other state in which the Equipment is or will be located; (b) Lessee has full
power, authority and legal right to sign, deliver and perform the Master Lease,
this Schedule and all related documents and such actions have been duly
authorized by all necessary corporate/partnership/proprietorship action; and
(c) the Master Lease, this Schedule and each related document has been duly
signed and delivered by Lessee and each such document constitutes a legal, valid
and binding obligation of Lessee enforceable in accordance with its terms.
14. CONDITIONS. No lease of Equipment under this Schedule shall be binding on
Lessor, and Lessor shall have no obligation to purchase the Equipment covered
hereby, unless: (a) Lessor has received evidence of all required insurance; (b)
in Lessor's sole judgment, there has been no material adverse change in the
financial condition or business of Lessee or any guarantor; (c) Lessee has
signed and delivered to Lessor this Schedule, which must be satisfactory to
Lessor, and Lessor has signed and accepted this Schedule; (d) no change in the
Code or any regulation thereunder, which in Lessor's sole judgment would
adversely affect the economics to Lessor of the lease transaction, shall have
occurred or shall appear to be imminant; (a) Lessor has received, in form and
substance satisfactory to Lessor, such other documents and information as Lessor
shall reasonably request; and (f) Lessee has satisfied all other reasonable
conditions established by Lessor.
15. OTHER DOCUMENTS: EXPENSES: Lessee agrees to sign and deliver to Lessor any
additional documents deemed desirable by Lessor to effect the terms of the
Master Lease or this Schedule including, without limitation, Uniform Commercial
Code financing statements which Lessor is authorized to file with the
appropriate filing officers. Lessee hereby irrevocably appoints Lessor as
Lessee's attorney-in-fact with full power and authority in the place of Lessee
and in the name of Lessee to prepare, sign, amend, file or record any Uniform
Commercial Code financing statements or other documents deemed desirable by
Lessor to perfect, establish or give notice of Lessor's interests in the
Equipment or in any collateral as to which Lessee has granted Lessor a security
interest. Lessee shall pay upon Lessor's written request any actual out-of-
pocket costs and expenses paid or incurred by Lessor in connection with the
above terms of this section or the funding and closing of this Schedule.
16. PURCHASE ORDERS AND ACCEPTANCE OF EQUIPMENT. Lessee agrees that (i) Lessor
has not selected, manufactured, sold or supplied any of the Equipment, (ii)
Lessee has selected all of the Equipment and its suppliers, and (iii) Lessee has
received a copy of, and approved, the purchase orders or purchase contracts for
the Equipment. AS BETWEEN LESSEE AND LESSOR, LESSEE AGREES THAT: (a) LESSEE HAS
RECEIVED, INSPECTED AND APPROVED ALL OF THE EQUIPMENT: (b) ALL EQUIPMENT IS IN
GOOD WORKING ORDER AND COMPLIES WITH ALL PURCHASE ORDERS OR CONTRACTS AND ALL
APPLICABLE SPECIFICATIONS; (C) LESSEE IRREVOCABLY ACCEPTS ALL EQUIPMENT FOR
PURPOSES OF THE LEASE "AS-IS, WHERE-IS" WITH ALL FAULTS; AND (d) LESSEE
UNCONDITIONALLY WAIVES ANY RIGHT THAT IT MAY HAVE TO REVOKE ITS ACCEPTANCE OF
THE EQUIPMENT.
PAGE 3
<PAGE>
LESSEE HAS READ AND UNDERSTOOD ALL OF THE TERMS OF THIS SCHEDULE. LESSEE AGREES
THAT THERE ARE NO ORAL OR UNWRITTEN AGREEMENTS WITH LESSOR REGARDING THE
EQUIPMENT OR THIS SCHEDULE.
BANC ONE LEASING CORPORATION MEADOW VALLEY CONTRACTORS, INC.
(Lessor) (Lessee)
By: /s/ [SIGNATURE By: /s/ GARY W. BURNELL
------------------------------- ---------------------------------
Title: MGR FUNDING Title: VP/CFO
---------------------------- ---------------------------------
Acceptance Date: 6/22/98 Witness: /s/ Tortina Bunton
------------------ ----------------------------
finperd
PAGE 4
<PAGE>
EXHIBIT 10.80
SCHEDULE TO MASTER LOAN AGREEMENT
[LOGO OF U.S. BANCORP]
MEADOW VALLEY CONTRACTORS, INC.
P.O. B0X 60726
Phoenix, Arizona 85802-0726
$1,000,000.00 Effective Date December 30, 1998 LOAN TRANSACTION NUMBER
1. THIS SCHEDULE is made between Meadow Valley Contractors, Inc., as Debtor,
and U.S. BANCORP LEASING & FINANCIAL (which, together with its successor and
assigns, will be called the "Secured Party") pursuant to the Master Loan
Agreement dated as of December 17, 1998 (the "Loan Agreement"), the terms of
which (including the definitions) are incorporated herein. If any terms hereof
are inconsistent with the terms of the Loan Agreement, the terms hereof shall
prevail.
2. FOR VALUE RECEIVED, Debtor hereby promises to pay to the order of Secured
Party the principal amount of One Million and 00/100 Dollars ($1,000,000.00)
with interest on any outstanding principal balance at the rate(s) specified
herein from the Effective Date hereof until this Schedule shall have been paid
in full in accordance with the following payment schedule: 48 installments of
$19,613.02 each, plus an estimated final payment of $227,153.98, including the
entire amount of interest accrued on this Schedule at the time of payment of
each installment. The first payment shall be due on February 1, 1999 and a like
payment shall be due on the same day of each succeeding month thereafter until
the entire principal and interest have been paid. At the time of the final
installment hereon, all unpaid principal and interest shall be due and owing.
Each payment shall be applied first to accrued and unpaid interest, and the
balance to the outstanding principal hereof. As a result, such final installment
may be substantially more or substantially less than the installments specified
herein.
3. The Debtor promises to pay interest on the principal balance outstanding at
a rate of 6.60 percent per annum.
4. The Debtor may prepay this Schedule, in whole or in part, by paying
simultaneously with and in addition to the prepayment, a premium for such
prepayment privilege equal to the specified percent of the amount prepaid in
accordance with the following schedule: one (1) to thirty (30) months 1%,
thirty-one (31) through forty-eight (48) months 0%. Additionally, the Debtor may
prepay up to $150,000.00 annually without incurring a prepayment penalty.
Notwithstanding the foregoing, payments made within 30 days of the date an
installment is due which do not exceed the scheduled amount of such installment
shall not be considered prepayments.
5. Each of Debtor, if more than one, and all other parties who at any time may
be liable hereon in any capacity, hereby jointly and severally waive diligence,
demand, presentment, presentment for payment, protest, notice of protest and
notice of dishonor of this Schedule, and authorize the Secured Party, without
notice, to grant extensions in the time of payment of and reductions in the rate
of interest on any moneys owing on this Schedule.
6. The following property is hereby made Collateral for all purposes under the
Loan Agreement:
One (1) 1996 Remco Sandmax 9000 Impact Crusher, s/n 90S0496-174
One (1) 1984 CAT 950E Loader, s/n 31R00591
One (1) 1988 CAT 936E Loader, s/n 33Z3330
One (1) 1987 International 4,000 gal Water Truck, s/n 1HTLKTVR2HH473124
One (1) 1987 International 4,000 gal Water Truck, s/n 1HTLKTVR8HH473127
One (1) 1985 Peterbilt 4,000 gal Water Truck, s/n 1XP4LA9X1FD185772
One (1) 1993 Ford F-700 1,800 gal Water Truck, s/n 1FDPK74C8PVA37845
One (1) 1985 Peterbilt 4,000 gal Water Truck, s/n 1XP4LA9X9FN190650
ADDRESS FOR ALL NOTICES:
P.O. BOX 2177, 7659 S.W. Mohawk Street
Tualatin, Oregon 97062-2177
<PAGE>
2
One (1) 1995 International 2,200 gal Water Truck, s/n 1HTSDZ7R1MH312201
One (1) 1994 Ford LTN8000 4,000 gal Water Truck, s/n 1FDYW82EGRVA07118
One (1) CAT D-8L Dozer, s/n 53Y01797
One (1) CAT 950B Loader, s/n 22Z01565
One (1) CAT 966E Loader, s/n 99Y06390
One (1) CAT 966F Loader, s/n 3XJ00607
One (1) Case 580SK 4x4 Backhoe Hertz, s/n JJGO183417
One (1) Case 580SK 4x4 Backhoe, s/n JJG01179261
One (1) CAT RT100 Forklift, s/n 1GJ00919
One (1) Grove 22 ton Crane, s/n 49581
One (1) 1994 CAT 140G Blade, s/n 5MDO2761
One (1) CMI SF550 Concrete Paver, s/n 5PD47
Each of the above units are complete as equipped including, but not limited
to, all attachments, accessories & replacements relating thereto.
7. The Collateral hereunder shall be based at the following location(s):
4411 S. 40th Street, Suite D-11
Phoenix, Arizona 85040
COUNTY: Maricopa
IN WITNESS WHEREOF, Debtor has executed this Schedule this 30th day of December,
1998.
Meadow Valley Contractors, Inc.
------------------------------
By: /s/ Gary W. Burnell
---------------------------
Gary W. Burnell
Vice President & Chief Financial
Officer
ADDRESS FOR ALL NOTICES:
P. O. Box 2177, 7659 S. W. Mohawk Street
Tualatin, Oregon 97062-2377
<PAGE>
MASTER LOAN AGREEMENT [LOGO OF U.S. BANCORP]
1.0 PARTIES, COLLATERAL AND OBLIGATIONS
1.1 This Agreement is dated as of December 17, 1998. For valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, Meadow Valley Contractors, Inc. (hereinafter called "Debtor")
with offices at P.O. Box 60726, Phoenix, Arizona 85040 intending to be
legally bound, hereby promises to pay to U.S. BANCORP LEASING & FINANCIAL,
an Oregon corporation having offices at P.O. Box 2177, 7659 S.W. Mohawk
Street, Tualatin, Oregon 97062-2177 (hereinafter called "Secured Party"),
any amounts set forth on any Schedule to Master Loan Agreement hereunder
(the "Schedule(s)", all the terms of which are incorporated herein) and
grants a security interest in and assigns, transfers and sets over to and
to the successors and assigns thereof, the property specified in any
Schedule hereunder wherever located, and any and all proceeds thereof,
insurance recoveries, and all replacements, additions, accessions,
accessories and substitutions thereto or therefor (hereinafter called the
"Collateral"). The security interest granted hereby is to secure payment of
any and all liabilities or obligations of Debtor to the Secured Party,
matured or unmatured, direct or indirect, absolute or contingent,
heretofore arising, now existing or hereafter arising, and whether under
this Agreement or under any other writing between Debtor and Secured Party
(all hereinafter called the "obligations" and/or the "liabilities").
1.2 JOINT AND SEVERAL LIABILITY; PAYMENT TERMS. In the event there is
more than one Debtor, all obligations shall be considered as joint and
several obligations of all Debtors regardless of the source of Collateral
or the particular Debtor with which the obligation originated. Interest
shall be calculated on the basis of a 360-day year. All payments on any
Schedule hereunder shall be made in lawful money of the United States at
the post office address of the Secured Party or at such other place as the
Secured Party may designate to Debtor in writing from time to time. In no
event shall any Schedule hereunder be enforced in any way which permits
Secured Party to collect interest in excess of the maximum lawful rate.
Should interest collected exceed such rate, Secured Party shall refund such
excess interest to Debtor. In such event, Debtor agrees that Secured Party
shall not be subject to any penalties for contracting for or collecting
interest in excess of the maximum lawful rate.
1.3 LATE CHARGE. If any of the obligations remains overdue for more
than ten (10) days, Debtor hereby agrees to pay on demand, as a late
charge, an amount equal to the lesser of (i) five percent (5.0%) of each
such overdue amount; or (ii) the maximum percentage of any such overdue
amount permitted by applicable law as a late charge. Debtor agrees that the
amount of such late charge represents a reasonable estimate of the cost to
Secured Party of processing a delinquent payment and that the acceptance of
any late charge shall not constitute a waiver of default with respect to
the overdue amount or prevent Secured Party from exercising any other
available rights and remedies.
2.0 WARRANTIES AND COVENANTS OF DEBTOR. DEBTOR HEREBY REPRESENTS, WARRANTS AND
COVENANTS THAT:
2.1 BUSINESS ORGANIZATION STATUS AND AUTHORITY. (i) Debtor is duly
organized, validly existing and in good standing under the laws of the
state of its organization and is qualified to do business in all states and
countries in which such qualification is necessary; (ii) Debtor has the
lawful power and authority to own its assets and to conduct the business in
which it is engaged; and to execute and comply with the provisions of this
Agreement and any related documents; (iii) the execution and delivery of
this Agreement and any related documents have been duly authorized by all
necessary action; (iv) no authorization, consent, approval, license or
exemption of, or filing or registration with, any or all of the owners of
Debtor or any governmental entity was, is or will be necessary to the valid
execution, delivery, performance or full enforceability of this Agreement
and any related documents. Except as specifically disclosed to Secured
Party, Debtor utilizes no trade names in the conduct of its business and/or
has not changed its name within the past five years.
2.2 MERGER: TRANSFER OF ASSETS. Debtor will not consolidate or merge
with or into any other entity, liquidate or dissolve, distribute, sell,
lease, transfer or dispose of all of its properties or assets or any
substantial portion thereof other than in the ordinary course of its
business, unless the Secured Party shall give its prior written consent,
and the surviving, or successor entity or the transferee of such assets, as
the case may be, shall assume, by a written instrument which is legal,
valid and enforceable against such surviving or successor entity or
transferee, all of the obligations of Debtor to Secured Party or any
affiliate of Secured Party.
2.3 NO VIOLATION OF COVENANTS OR LAWS. Debtor is not party to any
agreement or subject to any restriction which materially and adversely
affects its ability to perform its obligations under this Agreement and any
related documents. The execution of and compliance with the terms of this
Agreement and any related documents does not and will not (i) violate any
provision of law, or (ii) conflict with or result in a breach of any order,
injunction, or decree of any court or governmental authority or the
formation documents of Debtor, or (iii) constitute or result in a default
under any agreement, bond or indenture by which Debtor is bound or to which
any of its property is subject or (iv) result in the imposition of any lien
or encumbrance upon any of Debtor's assets, except for any liens created
hereunder or under any related documents.
2.4 ACCURATE INFORMATION. All financial information submitted to the
Secured Party in regard to Debtor or any shareholder, officer director,
member, or partner thereof, or any guarantor of any of the obligations
thereof, was prepared in accordance with generally accepted accounting
principles, consistently applied, and fairly and accurately depicts the
financial position and results of operations of Debtor or such other
person, as of the respective dates or for the respective periods, to which
such information pertains. Debtor had good, valid and marketable title to
all the properties and assets reflected as being owned by it on any balance
sheets of Debtor submitted to Secured Party as of the dates thereof.
2.5 JUDGMENTS; PENDING LEGAL ACTION. There are no judgments
outstanding against Debtor, and there are no actions or proceedings pending
or, to the best knowledge of Debtor, threatened against or affecting Debtor
or any of its properties in any court or before any governmental entity
which, if determined adversely to Debtor, would result in any material
adverse change in the business, properties or assets, or in the condition,
financial or otherwise, of Debtor or would materially and adversely affect
the ability of Debtor to satisfy its obligations under this Agreement and
any related documents.
ADDRESS FOR ALL NOTICES:
P.O. Box 2177, 7659 S.W. Mohawk Street
Tualatin, Oregon 97062-2177
<PAGE>
2.6 NO BREACH OF OTHER AGREEMENTS; COMPLIANCE WITH APPLICABLE LAWS.
Debtor is not in breach of or in default under any loan agreement,
indenture, bond, note or other evidence of indebtedness, or any other
material agreement or any court order, injunction or decree or any lien,
statute, rule or regulation. The operations of Debtor comply with all laws,
ordinances and governmental rules and regulations applicable to them.
Debtor has filed all Federal, state and municipal income tax returns which
are required to be filed and has paid all taxes as shown on said returns
and on all assessments billed to it to the extent that such taxes or
assessments have become due. Debtor does not know of any other proposed tax
assessment against it or of any basis for one.
2.7 SALE PROHIBITED. Debtor will not sell, dispose of or offer to
sell or otherwise transfer the Collateral or any interest therein without
the prior written consent of Secured Party.
2.8 LOCATION OF COLLATERAL. The Collateral will be primarily based at
the location(s) shown on the Schedule(s) hereunder and Debtor will promptly
notify Secured Party of any change in its chief executive office
location(s).
2.9 COLLATERAL NOT A FIXTURE. The Collateral in not attached, and
Debtor will not permit the Collateral to become attached, to real estate in
such a way that it would be considered part of the realty or designated a
"fixture." Notwithstanding any presumption of applicable law, and
irrespective of any manner of attachment, the Collateral shall not be
deemed real property but shall retain its character as personal property.
However, Debtor will at the option of Secured Party furnish the latter with
a waiver or waivers in recordable form, signed by all persons having an
interest in the real estate, of any interest in the Collateral which is or
might be deemed to be prior to Secured Party's interest.
2.10 PERFECTION OF SECURITY INTEREST. Except for (i) the security
interest granted hereby and (ii) any other security interest previously
disclosed by Debtor to Secured Party in writing, Debtor is the owner of the
Collateral free from any adverse lien, security interest or encumbrance.
Debtor will defend the Collateral against all claims and demands of all
persons at any time claiming any interest therein. Except as previously
disclosed in writing to Secured Party, no financing statement covering any
Collateral or any proceeds thereof is on file in any public office. At the
request of Secured Party, Debtor will execute, acknowledge and deliver to
Secured Party in recordable or fileable form, any document or instrument
required by Secured Party to further the purposes of this Agreement, or to
perfect its interest in the Collateral or to maintain such perfected
interest in full force an effect, including (without limitation) any
fixture filings and financing statements and any amendments and
continuation statements thereto pursuant to the Uniform Commercial Code, in
form satisfactory to Secured Party, and will pay the cost of filing the
same or filing or recording this Agreement in all public offices wherever
filing or recording is deemed by Secured Party to be necessary or
desirable. Debtor hereby agrees that this Agreement shall be and constitute
a financing statement for purposes of the Uniform Commercial Code.
2.11 INSURANCE. Unless otherwise agreed, Debtor will have and maintain
insurance from financially sound carriers at times with respect to all
Collateral against risks of the fire (including so-called extended
coverage), theft, collision, flood, earthquake, "mysterious disappearance"
and such other risks as Secured Party may require, containing such terms,
in such form, for such periods and written by such companies as my be
satisfactory to Secured Party; each insurance policy shall name Secured
Party as loss payee and shall be payable to Secured Party and Debtor as
their interests may appear, all policies of insurance shall provide for ten
days' written minimum cancellation notice to Secured Party; Debtor shall
furnish Secured Party with certificates or other evidence satisfactory to
Secured Party of compliance with the foregoing insurance provisions.
2.12 USE OF THE COLLATERAL. Debtor will use the Collateral for
business purposes only and operate it by qualified personnel in accordance
with applicable manufacturers' manuals. Debtor will keep the Collateral
free from any adverse lien or encumbrance and in good working order,
condition and repair and will not waste or destroy the Collateral or any
part thereof: Debtor will keep the Collateral appropriately protected from
the elements, and will furnish all required parts and servicing (including
any contract service necessary to maintain the benefit of any warranty of
the manufacturer); Debtor will not use the Collateral in violation of any
statute, ordinance, regulation or order, and Secured Party may examine and
inspect the Collateral and any and all books and records of Debtor during
business hours at any time; such right of inspection shall include the
right to copy Debtor's books and records and to converse with Debtor's
officers, employees, agents, and independent accountants.
2.13 TAXES AND ASSESSMENTS. Debtor will pay promptly when due all
taxes, assessments, levies, imposts, duties and charges, of any kind or
nature, imposed upon the Collateral or for its use or operation or upon
this Agreement or upon any instruments evidencing the obligations.
2.14 FINANCIAL STATEMENTS. Debtor shall furnish Secured Party within
ninety (90) days after the close of each fiscal year of Debtor, its financial
statements (including without limitation, a balance sheet, a statement of
income and surplus account and a statement of changes in financial position)
for the immediately preceding fiscal year, setting forth the corresponding
figures for the prior fiscal year in comparative form, all in reasonable
detail without any qualification or exception deemed material by Secured
Party. Such financial statements shall be prepared at least as a review by
Debtor's independent certified accountants and, if prepared as an audit, shall
be certified by such accountants. Debtor shall also furnish Secured Party with
any other financial information deemed necessary by Secured Party. Each
financial statement submitted by Debtor to Secured Party shall be accompanied
by a certificate signed by the chief executive officer, the chief operating
officer or the chief financial officer of Debtor, certifying that (i) such
financial statement was prepared in accordance with generally accepted
accounting principles consistently applied and fairly and accurately presents
the Debtor's financial condition and results of operations for the period to
which it pertains, and (ii) no event of default has occurred under this
Agreement during the period to which such financial statement pertains.
30. EVENTS OF DEFAULT
3.1 The following shall be considered events of default: (i) failure
on the part of Debtor to promptly perform in complete accordance with its
representations, warranties and covenants made in this Agreement or in any
other agreement with Secured Party, including, but not limited to, the
payment of any liability, with interest, when due, or default by Debtor
under the provisions of any other material agreement to which Debtor is
party.(ii)the death of Debtor if an individual or the dissolution of Debtor
if a business organization; (iii) the filing of any petition or complaint
under the Federal Bankruptcy Code or other federal or state acts of similar
nature, by or against Debtor, or an assignment for the benefit of creditors
by Debtor; (iv) an application for or the appointment of a Receiver,
Trustee or Conservator, voluntary or involuntary, by or against Debtor or
for any substantial assets of Debtor; (v) insolvency of Debtor under either
the Federal Bankruptcy Code or applicable principles of equity; (vi) entry
of judgment, issuance of any garnishment or attachment, or filing of any
lien, claim or government
ADDRESS FOR ALL NOTICES:
P.O Box 2177, 7659 S.W. Mohawk Street
Tualatin, Oregon 97062-2177
<PAGE>
attachment against the Collateral or which, in Secured party's sole
discretion, might impair the Collateral; (vii) the determination by Secured
Party that a material misrepresentation of fact has been made by Debtor in
this Agreement or in any writing supplementary or ancillary hereto; (viii)
a determination by Secured Party that Debtor has suffered a material
adverse change in its financial condition, business or operations from the
date of this Agreement, or (ix) bankruptcy, insolvency, termination, death,
dissolution or default of any guarantor for Debtor.
4.0 REMEDIES
4.1 Upon the happening of any event of default which is not cured
within ten (10) days, or at any time thereafter, (i) all liabilities of
Debtor shall, at the option of Secured Party, become immediately due and
payable; (ii) Secured Party shall have and may exercise all of the rights
and remedies granted to a secured party under the Uniform Commercial Code;
(iii) Secured Party shall have the right, immediately, and without notice
or other action, to set-off against any of Debtor's liabilities to Secured
Party any money owed by Secured Party in any capacity to Debtor, whether or
not due, and Secured Party shall be deemed to have exercised such right of
set-off and to have made a charge against any such money immediately upon
the occurrence of such default event though actual book entries may be made
at some time subsequent thereto; (iv) Secured Party may proceed with or
without judicial process to take possession of all or any part of the
Collateral; Debtor agrees that upon receipt of notice of Secured Party's
intention to take possession of all or any part of said Collateral, Debtor
will do everything necessary to make same available to Secured Party
(including, without limitation, assembling the Collateral and making it
available to Secured Party at a place designated by Secured Party which is
reasonably convenient to Debtor and Secured Party); and so long as Secured
Party acts in a commercially reasonable manner, Debtor agrees to assign,
transfer and deliver at any time the whole or any portion of the Collateral
or any rights or interest therein in accordance with the Uniform Commercial
Code and without limiting the scope of Secured Party's rights thereunder;
(v) Secured Party may sell the Collateral at public or private sale or in
any other commercially reasonable manner and, at the option of Secured
Party, in bulk or in parcels and with or without having the Collateral at
the sale or other disposition, and Debtor agrees that in case of sale or
other disposition of the Collateral, or any portion thereof, Secured Party
shall apply all proceeds first to all costs and expenses of disposition,
including attorneys' fees, and then to Debtor's obligations to Secured
Party; (vi) Secured Party may elect to retain the Collateral or any part
thereof in satisfaction of all sums due from Debtor upon notice to Debtor
and any other party as may be required by the Uniform Commercial Code. All
remedies provided in this paragraph shall be cumulative. Secured Party may
exercise any one or more of such remedies in addition to any and all other
remedies Secured Party may have under any applicable law or in equity.
4.2 EXPENSES; DISPOSITION. Upon default, all amounts due and to
become due hereunder shall, without notice, bear interest at the lesser of
(i) fifteen percent (15%) per annum or (ii) the maximum rate per annum
which Secured Party is permitted by law to charge from the date such
amounts are due until paid. Debtor shall pay all reasonable expenses of
realizing upon the Collateral hereunder upon default and collecting all
liabilities of Debtor to Secured Party, which reasonable expenses shall
include attorneys' fees, whether or not litigation is commenced and whether
incurred at trial, on appeal, or in any other proceeding. Any notification
of a sale or other disposition of Collateral or of other action by Secured
Party required to be given by Secured Party, will be sufficient if given
personally, mailed, or delivered by facsimile machine or overnight carrier
not less than five (5) days prior to the day on which such sale or other
disposition will be made or action taken, and such notification shall be
deemed reasonable notice.
5.0 MISCELLANEOUS
5.1 NO IMPLIED WAIVERS; ENTIRE AGREEMENT. The waiver by Secured Party
of any default hereunder or of any provisions hereof shall not discharge
any party hereto from liability hereunder and such waiver shall be limited
to the particular event of default and shall not operate as a waiver of any
subsequent default. This Agreement and any Schedule hereunder are non-
cancelable. No modification of this Agreement or waiver of any right of
Secured Party hereunder shall be valid unless in writing and signed by an
authorized officer of Secured Party. No failure on the part of Secured
Party to exercise, or delay in exercising, any right or remedy hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise
of any right or remedy hereunder preclude any other or further exercise
thereof or the exercise of any other right or remedy. The provisions of
this Agreement and the rights and remedies granted to Secured Party herein
shall be in addition to, and not in limitation of those of any other
agreement with Secured Party or any other evidence of any liability held by
Secured Party. This Agreement and any Schedule hereunder (a "Transaction")
embody the entire agreement between the parties and supersede all prior
agreements and understandings relating to the same subject matter, except
in any case where the Secured Party takes an assignment from a vendor of
its security interest in the same Collateral, in which case the terms of
the Transaction shall be incorporated into the assigned agreement and shall
prevail over any inconsistent terms therein but shall not be construed to
create a new contract.
5.2 CHOICE OF LAW. This Agreement and the rights of the parties
hereto shall be governed by applicable Federal law and the laws of the
State of Oregon. Any action arising out of this Agreement may be litigated
under the laws of Oregon and submitted to the jurisdiction of Oregon, and
that service of process of certified mail, return receipt requested, will
be sufficient to confer personal jurisdiction over the Debtor. SECURED
PARTY AND DEBTOR EACH WAIVE ALL RIGHTS TO TRIAL BY JURY IN ANY LITIGATION
ARISING FROM OR RELATED TO THIS AGREEMENT.
5.3 PROTECTION OF THE COLLATERAL. At its option, Secured Party may
discharge taxes, liens or other encumbrances at any time levied or placed
on the Collateral, may pay for insurance on the Collateral and may pay for
the maintenance and preservation of the Collateral. Debtor agrees to
reimburse Secured Party on demand for any payment made or any expense
incurred by Secured Party pursuant to the foregoing authorization. Any
payments made by Secured Party shall be immediately due and payable by
Debtor and shall bear interest at the rate of fifteen percent (15%) per
annum. Until default, Debtor may retain possession of the Collateral and
use it in any lawful manner not inconsistent with the provisions of this
Agreement and any other agreement between Debtor and Secured Party, and not
inconsistent with any policy of insurance thereon.
5.4 BINDING AGREEMENT; TIME OF THE ESSENCE. This Agreement shall take
effect as a sealed instrument and shall be binding upon and shall inure to
the benefit of the parties hereto, their respective heirs, executors,
administrators, successors, and assigns. Time is of the essence with
respect to the performance of Debtors' obligations under this Agreement and
any other agreement between Debtor and Secured Party.
5.5 ENFORCEABILITY. Any term, clause or provision of this Agreement
or of any evidence of indebtedness from Debtor to Secured Party which is
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective only to the extent of each prohibition or unenforceability
without invalidating the remaining terms or clauses of such provision or
the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not
ADDRESS FOR ALL NOTICES:
P.O. BOX 2177, 7659 S.W. Mohawk Street
Tualarin, Oregon 97062-2177
<PAGE>
invalidate or render unenforceable such term, clause or provision in any
other jurisdiction.
5.6 NOTICES. Any notices or demands required to be given herein shall
be given to the parties in writing by United States first class mail
(express, certified or otherwise) at the addresses set forth on page 1 of
this Agreement or to such other addresses as the parties may hereafter
substitute by written notice given in the manner prescribed in this
paragraph.
5.7 ADDITIONAL SECURITY. If there shall be any other collateral for
any of the obligations, or for the obligations of any guarantor thereof,
Secured Party may proceed against and/or enforce any or all of the
Collateral and such collateral in whatever order it may, in its sole
discretion, deem appropriate. Any amount(s) received by Secured Party from
whatever source and applied by it to any of the obligations shall be
applied in such order of application as Secured Party shall from time to
time, in its sole discretion, elect.
6.0 ASSIGNMENT
6.1 SECURED PARTY MAY SELL OR ASSIGN ANY AND ALL RIGHT, TITLE AND
INTEREST IT HAS IN THE COLLATERAL AND/OR ARISING UNDER THIS AGREEMENT.
DEBTOR SHALL, UPON THE DIRECTION OF SECURED PARTY: 1) EXECUTE ALL DOCUMENTS
NECESSARY TO EFFECTUATE SUCH ASSIGNMENT AND, 2) PAY DIRECTLY AND PROMPTLY
TO SECURED PARTY'S ASSIGNEE WITHOUT ABATEMENT, DEDUCTION OR SET-OFF, ALL
AMOUNTS WHICH HAVE BECOME DUE UNDER THE ASSIGNED AGREEMENTS. SECURED
PARTY'S ASSIGNEE SHALL HAVE ANY AND ALL RIGHTS, IMMUNITIES AND DISCRETION
OF SECURED PARTY HEREUNDER AND SHALL BE ENTITLED TO EXERCISE ANY REMEDIES
OF SECURED PARTY HEREUNDER. ALL REFERENCES HEREIN TO SECURED PARTY SHALL
INCLUDE SECURED PARTY'S ASSIGNEE (EXCEPT THAT SAID ASSIGNEE SHALL NOT BE
CHARGEABLE WITH ANY OBLIGATIONS OR LIABILITIES HEREUNDER OR IN RESPECT
HEREOF). DEBTOR WILL NOT ASSERT AGAINST SECURED PARTY'S ASSIGNEE ANY
DEFENSE, COUNTERCLAIM OR SET-OFF WHICH DEBTOR MAY HAVE AGAINST SECURED
PARTY.
6.2 DEBTOR SHALL NOT ASSIGN OR IN ANY WAY DISPOSE OF ALL, OR ANY OF
ITS RIGHTS OR OBLIGATIONS UNDER THIS AGREEMENT OR ENTER INTO ANY AGREEMENT
REGARDING OF ALL OR ANY PART OF THE COLLATERAL WITHOUT THE PRIOR WRITTEN
CONSENT OF SECURED PARTY WHICH SHALL NOT BE UNREASONABLY WITHHELD. IN
CONNECTION WITH THE GRANTING OF SUCH CONSENT AND THE PREPARATION OF
NECESSARY DOCUMENTATION, A FEE SHALL BE ASSESSED EQUAL TO ONE PERCENT (1%)
OF THE TOTAL REMAINING BALANCE THEN DUE HEREUNDER.
NOTWITHSTANDING THE ABOVE, THE FEE FOR ANY SUBSTITUTION OF ANY PART OF THE
COLLATERAL SHALL BE $500 FOR EACH SUBSTITUTION AFTER THE FIRST ONE (FOR
WHICH THERE SHALL BE NO FEE), SECURED PARTY'S PRIOR WRITTEN CONSENT (WHICH
SHALL NOT BE UNREASONABLY WITHHELD) SHALL BE REQUIRED FOR EACH
SUBSTITUTION.
7.0 POWER OF ATTORNEY
7.1 Secured Party is hereby appointed Debtor's attorney-in-fact to
sign Debtor's name and to make non-material amendments (including
completing and conforming the description of the Collateral) on any
document in connection with this Agreement (including any financing
statement) and to obtain, adjust, settle, and cancel any insurance required
by this Agreement and to endorse any drafts in connection with such
insurance.
8.0 NOTICE
8.1 Under Oregon law, most agreements, promises and commitments made
----------------------------------------------------------------
by Debtor, after October 3, 1989, concerning loans and other credit
-------------------------------------------------------------------
extensions which are not for personal, family or household purposes or
----------------------------------------------------------------------
secured solely by the Debtor's residence must be in writing, express
--------------------------------------------------------------------
consideration and be signed by Debtor to be enforceable.
-------------------------------------------------------
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed the 30 day of December, 1998.
U.S. BANCORP LEASING & FINANCIAL MEADOW VALLEY CONTRACTORS, INC.
[DEBTOR]
By: ____________________________ By: /s/ Gary W. Burnell
An authorized officer thereof --------------------------
Gary W. Burnell
Vice President & Chief
Financial Officer
ADDRESS FOR ALL NOTICES:
P.O. Box 2177, 7659 S. W. Mohawk Street
Tualatin, Oregon 97062-2177
<PAGE>
EXHIBIT 10.81
[LOGO] SECURITY AGREEMENT
The undersigned debtor, meaning all debtors jointly and severally ("DEBTOR"), to
secure the obligations set forth herein grants to the secured party named below
(herein, with its successors and assigns, called "SECURED PARTY") under the
terms and provisions of this agreement (this "AGREEMENT") a security interest in
the following described property (herein, with all present and future
attachments, accessories, replacement parts, repairs and additions or
substitutions, referred to collectively as "EQUIPMENT"):
ONE (1) HITACHI MODEL EX700 HYDRAULIC EXCAVATOR S/N 172-1691 EQUIPPED WITH
ONE (1) 72 INCH BUCKET S/N RH66636
ONE (1) VOLVO MODEL A25C 4X4 ARTICULATED TRUCK S/N 68139
The Equipment will be used primarily for: [X] business or commercial use other
than farming operations; [_] farming operations. When not in use, the Equipment
will be kept at: 1501 HIGHWAY 168, MOAPA and, when in use, will be used only in
the following State(s): NV
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
PAYMENT SCHEDULE USE OF PROCEEDS
<S> <C>
Debtor promises to pay Secured Party the Total Amount of Secured Party is hereby irrevocably authorized and directed to disburse
$ 317,176.80 (the "Total Amount") in 24 installments as the proceeds of this Agreement as follows:
follows:
(a) $ 13,215.70 on 12/20/98, and a like sum on the Amount Payee (Name and Address)
like date of each month thereafter until fully paid. $ 296,181.35 DeNardi Equipment Company, Inc.
or ------------ ------------------------------------------------------
______________________________________________________
(b) ______________________________________________________
$ 595.00 Associates Commercial Corporation
------------ ------------------------------------------------------
Administrative Fees
------------------------------------------------------
______________________________________________________
$ 296,776.35 TOTAL
------------ ------------------------------------------------------
------------------------------------------------------
------------------------------------------------------
Debtor hereby acknowledges and agrees that the proceeds of this
Agreement will be used for commercial, business or agricultural
provided, however, that the final installment will be in purposes and will not be used for personal, family or household
the amount of the then remaining unpaid balance. All purposes. Secured Party may disburse the proceeds using checks, drafts,
amounts payable under this Agreement are payable at orders, transfer funds, or any other method or media Secured Party
Secured Party's address shown below or at such other deems desirable. Disbursement may be made in Secured Party's name on
address as Secured Party may specify from time to time in Debtor's behalf or in Debtor's name. Disbursement in accordance with
writing. Any note taken in conjunction with this Agreement the above instructions or any written supplement to these instructions
evidences indebtedness and not payment. will constitute payment and delivery to and receipt by Debtor of all
such proceeds.
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
INSURANCE: Physical damage insurance covering the equipment is required. Debtor
can furnish this insurance through an agent or broker of Debtor's choice. Debtor
hereby authorizes Secured Party and any assignee to release to any insurance
company affiliated with Secured Party or any assignee any information relating
to a contract or policy of insurance which is providing or may provide insurance
coverage against physical damage to the Equipment.
- --------------------------------------------------------------------------------
TOTAL AMOUNT: The Total Amount consists of $ 296,776.35 of principal and
precomputed interest in the amount of $ 20,400.45 computed on the basis of 6.47%
per annum on the assumption that all payments will be made on their respective
due dates.
DELINQUENCY, RETURNED CHECKS AND ACCELERATION INTEREST: For each installment not
paid when due, Debtor agrees to pay to Secured Party a delinquency charge
calculated thereon at the rate of 1 1/2% per month for the period of delinquency
or, at Secured Party's option, 5% of such installment, provided that such a
delinquency charge is not prohibited by law, otherwise at the highest rate
Debtor can legally obligate itself to pay and/or Secured Party can legally
collect. Debtor agrees to reimburse Secured Party immediately upon demand for
any amount charged to Secured Party by any depositary institution because a
check, draft or other order made or drawn by or for the benefit of Debtor is
returned unpaid for any reason and, if allowed by law, to pay Secured Party an
additional handling charge in the amount of $25.00 or in the event applicable
law limits or restricts the amount of such reimbursement and/or handling charge,
the amounts chargeable under this provision will be limited and/or restricted in
accordance with applicable law. Debtor agrees to pay Secured Party, upon
acceleration of Debtor's indebtedness, interest on all sums then owing hereunder
at the rate of 1 1/2% per month if not prohibited by law, otherwise at the
highest rate. Debtor can legally obligate itself to pay and/or Secured Party can
legally collect. Any note take herewith evidences indebtedness and not payment.
All amounts payable hereunder are payable at Secured Party's address shown below
or at such other address as Secured Party may specify from time to time in
writing.
SECURITY INTEREST: To secure payment of the Total Amount and all of Secured
Party's obligations under this Agreement or with respect to the Equipment,
Debtor hereby grants to Secured Party a first priority security interest in the
Equipment and in all cash and non-cash proceeds thereof (the Equipment and all
such proceeds are herein called the "COLLATERAL") regardless of any retaking
and/or redelivery of the Collateral to Debtor.
CROSS SECURITY: Debtor grants to Secured Party a security interest in the
Collateral (separate and distinct from and subordinate to that security interest
granted pursuant to Secured Party pursuant to Section 2 above) to secure the
payment of all absolute and all contingent obligations and liabilities of Debtor
to Secured Party, or to any assignee of Secured Party, now existing of hereafter
arising, whether under this agreement or any other agreement and whether due
directly or by assignment; provided, however, upon any assignment of this
Agreement by Secured Party, the assignee shall be deemed for the purpose of this
paragraph as the only party with a security interest in the Collateral.
PREPAYMENT: Debtor may prepay Debtor's obligations under this Agreement in full
at any time. Upon prepayment Debtor will receive a rebate of the unearned
portion of the finance charge calculated using an actuarial method or such other
method as is required by any applicable law minus, if the prepayment is made
prior to the last twelve months of the contract, a prepayment processing fee
equal to the lesser of (a) one percent (1%) of the amount prepaid for each full
twelve month period remaining under the term of this Agreement as of prepayment
and (b) the maximum prepayment and/or acquisition charge allowed by applicable
law. All accrued and unpaid late charges and other amounts chargeable to Debtor
under this Agreement will be payable immediately upon such prepayment.
Page 1 of 3 of Security Agreement dated 11/19/98 between Meadow Valley
Contractors, Inc. (Debtor) and Associates Commercial Corporation (Secured Party)
which includes, without limitation, an item of Collateral with the following
serial number: 172-1691.
Debtor's Initials GB
-------------------------
/s/ SIGNATURE ILLEGIBLE
-------------------------
<PAGE>
1. ADDITIONAL WARRANTIES AND AGREEMENTS. Debtor warrants and agrees that: the
execution of and performance by Debtor under the terms of this Agreement has
been approved for Debtor by all necessary action and by Debtor's partners or
board of directors, as applicable; the Equipment is currently and will continue
be maintained in good operating condition, repair and appearance and is
currently and will continue be used and operated with care only by qualified
personnel in the regular course of Debtor's business and in conformity with all
applicable governmental laws and regulations, manufacturer's specifications and
the restrictions contained in any insurance policy insuring the Equipment; the
Equipment is not currently and will not be used in conjunction with the storage,
transportation or disposal of substances considered to be toxic and/or hazardous
or in conjunction with any activity or for any use that would subject the
Equipment to seizure or confiscation by any governmental body; and the Equipment
is currently located at and will be kept by Debtor at the location set forth for
it on the reverse side of this Agreement and will not be removed from said
location without the prior written consent of Secured Party, except that if the
Equipment is of a type which is mobile and normally used by Debtor at more than
one location, Debtor may use the Equipment away from said location in the
regular course of Debtor's business provided that (a) if the Equipment is not
returned to said location within 30 days, Debtor will immediately thereafter,
and each 30 days thereafter until the Equipment is returned, report the then
current location of the Equipment to Secured Party in writing and (b) the
Equipment shall not be removed from the State(s) of use indicated on the reverse
side of this Agreement. Secured Party shall have the right to inspect the
Equipment at all reasonable times and from time to time.
Debtor further warrants and agrees that: the security interest in the
Collateral granted to and/or retained by Secured Party is and will continue to
be superior to any title to or interest in the Equipment now or hereafter held
or claimed by any other party; the Collateral is free from and will be kept free
from all liens, claims, security interests and encumbrances (whether superior or
inferior to the interests of Secured Party) other than that created by this
Agreement; notwithstanding Secured Party's interest in proceeds, Debtor will not
and will not allow any other party to consign, sell, rent, lend, encumber,
pledge, transfer, secrete or otherwise dispose of any of the Collateral without
Secured Party's prior written consent; Debtor will do everything Secured Party
deems necessary or expedient to perfect or preserve the interests granted to
Secured Party under this Agreement and the first priority of such interests; any
Manufacturer's Statement or Certificate of Origin or Certificate of Title
relating to the Equipment shall be immediately delivered to Secured Party and,
if a Certificate of Title or registration is required for any item of Equipment,
Debtor will cooperate with Secured Party in obtaining the Certificate of Title
or registration disclosing the interests of Debtor and Secured Party in the
Equipment; Debtor will defend any action, proceeding or claim affecting the
Collateral or the interests of Secured Party in the Collateral; Debtor shall
promptly pay all amounts payable in conjunction with the storage, maintenance or
repair of the Equipment and all taxes, assessments, license fees and other
public or private charges levied or assessed in conjunction with the operation
or use of the Equipment or levied or assessed against the Collateral, this
Agreement or any accompanying note except for those which are being contested by
Debtor in good faith by appropriate proceedings and which do not constitute a
lien or encumbrance upon the Collateral; and Debtor will from time to time
furnish Secured Party with such financial statements and other information as
Secured Party may reasonably request.
2. INSURANCE AND RISK OF LOSS. Debtor shall at all times bear all risk of
loss of, damage to or destruction of the Equipment. Debtor agrees to immediately
procure and maintain insurance on the Equipment, for the full insurable
value thereof and for the life of this Agreement, in the form of "All Risk" or
similar insurance (insuring the Equipment for fire, extended coverage,
vandalism, theft and collision and containing only those exclusions from
coverage which are acceptable to Secured Party) plus such other insurance as
Secured Party may specify from time to time, all in form and amount and with
insurers satisfactory to Secured Party. Debtor agrees to deliver promptly to
Secured Party certificates or, if requested, policies of insurance satisfactory
to Secured Party, each with a standard long-form loss-payable endorsement naming
Secured Party or assigns as loss-payee and providing that Secured Party's rights
under such policy will not be invalidated by any act, omission or neglect of
anyone other than Secured Party, and containing the insurer's agreement to give
30 days prior written notice to Secured Party before any cancellation of or
material change in the policy(s) will be effective as to Secured Party, whether
such cancellation or change is at the direction of Debtor or insurer. Secured
Party's acceptance of policies in lesser amounts or risks will not be a waiver
of Debtor's obligation to procure insurance complying with the provisions hereof
promptly after notice from Secured Party. Debtor assigns to Secured Party all
proceeds of any physical damage or credit insurance for which a charge is
stated in this Agreement or which is maintained by Debtor in accordance
herewith, including returned and unearned premiums, up to the amount owing
hereunder by Debtor. Secured Party will not have the right to cancel any such
insurance without Debtor's consent prior to the occurrence of an event of
default and the repossession, loss or destruction of the Equipment. Debtor
directs all insurers to pay such proceeds solely to the order of Secured Party
for application to Debtor's indebtedness to Secured Party. Secured Party may, at
its option, apply any such proceeds received by Secured Party to the final
maturing installments due hereunder in the inverse order of their maturity.
3. PERFORMANCE BY SECURED PARTY. If Debtor fails to perform any of Debtor's
obligations pursuant to Paragraphs 1 or 2 above, Secured Party may perform the
same for the account of Debtor. Any such action by Secured Party will be in
Secured Party's sole discretion and Secured Party will not be obligated in any
way to do so. Secured Party's performance on behalf of Debtor will not obligate
Secured Party to perform the same or any similar act in the future and will not
cure or waive Debtor's failure of performance as an event of default hereunder.
All sums advanced or costs and expenses incurred by Secured Party pursuant to
this Paragraph, including the reasonable fees of any attorney retained by
Secured Party, will be for the account of Debtor, will constitute indebtedness
secured by Secured Party's security interest in the Collateral, will bear
interest at the rate as specified on the reverse side of this Agreement in the
event of acceleration and, unless Secured Party, in Secured Party's sole
discretion agrees otherwise in writing, shall be immediately due and payable.
4. EVENTS OF DEFAULT. Time is of the essence. An event of default will occur
if: (a) Debtor fails to pay when due any amount owed by it to Secured Party
under this Agreement or under the terms of any promissory note delivered in
conjunction with this Agreement or if Debtor fails to pay when due any amount
owed by it to Secured Party or to any affiliate of Secured Party under any other
document, agreement or instrument; (b) Debtor fails to perform in compliance
with any of its agreements hereunder or any warranty made by Debtor in this
Agreement is or becomes incorrect or if Debtor fails to perform or observe any
term or provision to be performed or observed by it under any other document,
instrument or agreement furnished by Debtor to Secured Party or any affiliate of
Secured Party or otherwise acquired by Secured Party or any affiliate of Secured
Party; (c) any information, representation, or warranty furnished by Debtor to
Secured Party or to any affiliate of Secured Party is inaccurate or incorrect in
any material respect when furnished; (d) Debtor becomes insolvent or ceases to
do or is prohibited by any court order or governmental action from conducting
the business in which Debtor is principally engaged on the date of this
Agreement as a going concern; (e) any surety or bonding company assumes any of
Debtor's responsibilities under any contract or job; (f) if any of the Equipment
is lost, stolen, destroyed, confiscated by any governmental agency, abandoned,
or relocated, used or maintained in violation of the terms hereof or if Debtor
attempts to consign, sell, rent, lend or encumber any of the Equipment or allows
another to do so; (g) Debtor files a petition in bankruptcy, or for an
arrangement, reorganization, or similar relief, or makes an assignment for the
benefit of creditors, or applies for the appointment of a receiver or trustee
for a substantial part of its assets or for any of the Equipment, or attempts to
take advantage of any process or proceeding for the relief of debtors, or if any
such action is taken against Debtor; (h) any other party attempts to attach,
repossess or execute upon any of the Collateral; (i) Debtor ceases to exist as a
legal entity or Debtor or any party in control of Debtor takes any action
looking to Debtor's dissolution as a legal entity; (j) there shall be a material
change in the management, ownership or control of Debtor; or (k) Secured Party
in good faith believes that the prospect of payment or performance hereunder is
impaired. Secured Party's inaction with respect to an event of default shall not
be a waiver of such default and Secured Party's waiver of any default shall not
be a wiver of any other default.
5. REMEDIES UPON DEFAULT. Upon the occurrence of an event of default, and at
any time thereafter as long as the default continues, Secured Party may, at its
option, with or without notice to Debtor (i) declare this Agreement to be in
default, (ii) declare the Indebtedness hereunder to be immediately due and
payable, (iii) declare all other debts then owing by Debtor to Secured Party to
be immediately due and payable, (iv) cancel any insurance and credit any refund
to the Indebtedness, and (v) exercise all of the rights and remedies of a
Secured Party under the Uniform Commercial Code and any other applicable laws,
including, without limitation, the right to require Debtor to assemble the
Equipment and deliver it to Secured Party at a place to be designated by Secured
Party which is reasonably convenient to both parties, and to lawfully enter any
premises where the Collateral may be without judicial process and take
possession thereof. Acceleration of any or all indebtedness, if so elected by
Secured Party, shall be subject to all applicable laws including those
pertaining to refunds and rebates of unearned charges. Any property other than
the Collateral which is in or upon the Equipment at the time of repossession may
be taken and held without liability until its return is requested by Debtor. Any
sale or other disposition of any of the Equipment may be made at public or
private sale or through public auction at the option of Secured Party. Secured
Party may buy at any sale and become the owner of the Equipment. Unless
otherwise provided by law, any requirement of reasonable notice which Secured
Party may be obligated to give regarding the sale or other disposition of
Collateral will be met if such notice is given to Debtor at least ten days
before the time of sale or other disposition. Debtor agrees that Secured Party
may bring any legal proceedings it deems necessary to enforce the payment and
performance of Debtor's obligations hereunder in any court in the State shown in
Secured Party's address set forth herein, and service of process may be made
upon Debtor by mailing a copy of the summons to Debtor. All notices to Debtor
relating to this Agreement will be considered received when delivered in person
(including by facsimile transmission) or mailed to Debtor at the address of
Debtor contained in this Agreement or at any address later designated by Debtor
to Secured Party in writing. The filing by Secured Party of any action or
proceeding with respect to the Equipment or any of Debtor's obligations
hereunder shall not constitute an election by Secured Party of Secured Party's
remedies or a waiver of Secured Party's rights to take possession of the
Equipment as provided above. Expenses of retaking, holding, preparing for sale,
selling and the like shall include (a) the reasonable fees of any attorneys
retained by Secured Party, (b) any amounts advanced or expenses incurred by
Secured Party pursuant to Paragraph 9 hereof and (c) all other legal and other
expenses incurred by Secured Party, Debtor agrees that it is liable for an will
promptly pay any deficiency resulting from any disposition of Collateral after
default and all costs and expenses, including the reasonable fees of any
attorney, incurred by Secured Party in the collection of any such deficiency.
Page 2 of 3 of Security Agreement dated 11/19/98 between Meadow Valley
Contractors, Inc. (Debtor) and Associates Commerical Corporation (Secured Party)
which includes, without limitation, an item of Collateral with the following
serial number: 172-1691.
<PAGE>
6. POWER OF ATTORNEY. DEBTOR HEREBY APPOINTS SECURED PARTY OR ANY OFFICER,
EMPLOYEE OR DESIGNEE OF SECURED PARTY OR ANY ASSIGNEE OF SECURED PARTY (OR ANY
DESIGNEE OF SUCH ASSIGNEE) AS DEBTOR'S ATTORNEY-IN-FACT, IN DEBTOR'S OR SECURED
PARTY'S NAME, TO: (a) PREPARE, EXECUTE AND SUBMIT ANY NOTICE OR PROOF OF LOSS IN
ORDER TO REALIZE THE BENEFITS OF ANY INSURANCE POLICY INSURING THE EQUIPMENT:
(b) PREPARE, EXECUTE AND FILE ANY INSTRUMENT WHICH, IN SECURED PARTY'S OPINION,
IS NECESSARY TO PERFECT AND/OR GIVE PUBLIC NOTICE OF THE INTERESTS OF SECURED
PARTY IN THE EQUIPMENT; AND (c) ENDORSE DEBTOR'S NAME ON ANY REMITTANCE
REPRESENTING PROCEEDS OF ANY INSURANCE RELATING TO THE EQUIPMENT (WHETHER OR NOT
THE SAME IS A DEFAULT HEREUNDER). This power is coupled with an interest and is
irrevocable so long as any indebtedness hereunder remains unpaid. Debtor agrees
to execute and deliver to Secured Party, upon Secured Party's request such
documents and assurances as Secured Party deems necessary or advisable for the
confirmation or perfection of this Security Agreement and Secured Party's rights
hereunder, including such documents as Secured Party may require for filing or
recordings.
7. ASSIGNMENT. Debtor shall not assign this Agreement without the prior
written consent of Secured Party. Secured Party may assign this Agreement with
or without notice to or the consent of Debtor. Upon assignment, the term
"Secured Party" shall mean and refer to any assignee who is the holder of this
Agreement. After assignment of this Agreement by Secured Party, the assignor
will not be the assignee's agent for any purpose and Debtor's obligations to the
assignee will be absolute and unconditional and, to the extent permitted by
applicable law, will not be subject to any abatement, reduction, recoupment,
defense, set-off or counterclaim available to Debtor for breach of warranty or
for any other reason whatsoever. Upon full payment of all obligations secured by
this Agreement, the assignee may deliver all original papers to the assignor for
Debtor.
8. MISCELLANEOUS. (A) All of Secured Party's rights hereunder are cumulative
and not alternative. (B) The inclusion of a trade name or division name in the
identification of Debtor hereunder does not limit Secured Party's rights, after
the occurrence of an event of default, to proceed against all of Debtor's
assets, including those held or used by Debtor individually or under another
trade or division name. (C) If permitted by law, Debtor agrees that a carbon,
photographic or other reproduction of this Agreement or of a financing statement
may be filed as a financing statement. (D) Secured Party may correct patent
errors herein and fill in blanks. (E) All of the terms and provisions hereof
will apply to and be binding upon Debtor, its heirs, personal representatives,
successors and assigns and shall inure to the benefit of Secured Party, its
successors and assigns. (F) Debtor and Secured Party hereby waive any right to
trial by jury in any action or proceeding relating to this Agreement or the
transaction contemplated hereby. (G) Debtor hereby expressly waives notice of
nonpayment, presentment, protest, dishonour, default, intent to accelerate the
maturity hereof and of acceleration of the maturity hereof. (H) If allowed by
law, "the reasonable fees of attorneys" retained by Secured Party shall include
the amount of any flat fee, retainer, contingent fee and/or the hourly charges
of any attorney retained by Secured Party in enforcing any of Secured Party's
rights hereunder in the prosecution or defense of any litigation related to this
Agreement or the transactions contemplated by this Agreement. (I) To the extent
allowed by law, Debtor hereby waives any exemptions or appraisals. (J) No waiver
or change in this Agreement or in any related note will be binding upon Secured
Party, or Secured Party's assignee, unless such waiver or change is in writing
and signed by one of its officers and any such waiver or change shall then be
effective only upon the terms and to the extent provided in such writing. (K)
The acceptance by Secured Party of any remittance from a party other than Debtor
will in no way constitute Secured Party's consent to the transfer of any of the
Collateral to such Party. (L) Any captions or headings included in this
Agreement are for convenience of reference only and shall not limit or otherwise
affect the meaning of any provision contained in this Agreement. (M) Any
provision contained herein which is contrary to, prohibited by or invalid under
applicable laws or regulations will be deemed inapplicable and omitted herefrom,
but shall not invalidate the remaining provisions hereof. (N) The only copy of
this Agreement which constitutes "chattel paper" is the original executed copy
designated as "Original For Associates".
- --------------------------------------------------------------------------------
DELIVERY AND ACCEPTANCE OF EQUIPMENT
(Check Appropriate Box)
Debtor's obligations and liabilities to Secured Party are absolute and
unconditional under all circumstances and regardless of any failure of operation
or Debtor's loss of possession of any item of Equipment or the cessation or
interruption of Debtor's business for any reason whatsoever.
[_] On ____________ the Equipment being purchased with the proceeds of this
Agreement was delivered to Debtor with all installation and other work
necessary for the proper use of the Equipment completed at a location
agreed upon by Debtor; the Equipment was inspected by Debtor and found to
be in satisfactory condition in all respects and delivery was
unconditionally accepted by Debtor.
[_] The Equipment being purchased with the proceeds of this Agreement has not
yet been delivered to or accepted by Debtor and, upon delivery, Debtor
agrees to execute such delivery and acceptance certificate as Secured Party
requires.
[X] All of the Equipment was acquired by Debtor prior to the date hereof and
was previously delivered to and unconditionally accepted by Debtor.
- --------------------------------------------------------------------------------
ADDITIONAL TERMS AND ORAL AGREEMENTS: Debtor and Secured Party agree that this
is a three page agreement and each page hereof constitutes a part of this
agreement. THIS WRITTEN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES, THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.
Debtor's Social Security or Federal Taxpayer Identification Number is 88-0171959
and Co-Debtor's is:______________.
<TABLE>
<S> <C>
Dated 11/19/98 DEBTOR HEREBY ACKNOWLEDGES RECEIPT OF AN
EXACT COPY OF THIS CONTRACT.
Secured Party Associates Commercial Corporation Debtor(s) MEADOW VALLEY CONTRACTORS, INC.
(Name of Individual, corporation or partnership.) (Name of individual(s) or partnership. Give trade style,
if any, after name.)
By /s/ Gary W. Burnell Title VP/CFO
--------------------------- -----------------
(If corporation, authorized party must sign and show
corporate title. If partnership, a general partner
must sign. If owner(s) or partner, show which.)
By _________________________________________________________
Title _______________________________________________________
(If corporation, authorized party must sign and show
corporate title, if partnership, a general
partner must sign. If owner or partner, show which.)
By _______________________ Title ______________________
if co-buyer, co-partner or co-officer, sign here and show
which)
P O BOX 2340
- ----------------------------------------------------------------
(Street Address)
NEWPORT BEACH CA 92658 4411 S. 40th STREET, SUITE D-11
- ---------------------------------------------------------------- -----------------------------------------------------------
(City, State and Zip Code) (Street Address)
PHOENIX MARICOPA AZ 85040
-----------------------------------------------------------
(City, COUNTY, State, and Zip Code)
</TABLE>
Page 3 of 3 of Security Agreement dated 11/19/98 between Meadow Valley
Contractors, Inc. (Debtor) and Associates Commercial Corporation (Secured Party)
which includes, without limitation, an item of Collateral with the following
serial number: 172-1891.
ORIGINAL
<PAGE>
EXHIBIT 10.82
Dated as of JUN 1 1998
----------------
LESSEE: MEADOW VALLEY LESSOR: CATERPILLAR FINANCIAL SERVICES
CONTRACTORS, INC. CORPORATION
ADDRESS: 4411 S. 40TH, SUITE D11 ADDRESS: 4976 Preston Park Blvd.
P.O. BOX 60726
PHOENIX, AZ 85040 Plano, TX 75093
Lessor, in reliance on Lessee's selection of the equipment described below
("Unit" or "Units"), agrees to acquire and lease the Units to Lessee, and
Lessee agrees to lease the Units from Lessor, subject to the terms and
conditions below and on the reverse side:
<TABLE>
<CAPTION>
DESCRIPTION OF UNIT(S) SERIAL# MONTHLY RENT FINAL PAYMENT
- ---------------------- ------- ---------------- -------------
<S> <C> <C> <C> <C>
(1) CTO85 OLYMPIA PACKAGED GENERATOR SET 2010549 # 1-18 @ $519.46 $13,995.03*
69KW PRIME POWER, 75KW STANDBY #19-30 @ $519.46 $ 8,749,87*
POWER, 120/240/480 VOLT SINGLE #31-42 @ $519.46 $ 3,041.08*
& THREE PHASE SELECTABLE, SKID #43-48 @ $519.46 $ 0.00
MOUNTED UNIT W/SOUND ATTENUATED
ENCLOSURE. BASE MOUNTED FUEL TANK
W/150 GALLON CAPACITY.
</TABLE>
RENT TO BE PAID: in arrears (starts one month after Delivery Date) and every
month thereafter.
Lease Term: 48 Months Utilization Date: AUGUST 31, 1998
The [_] Mandatory Final Payment (Section 13)[X] Optional Final Payment (Section
14) is applicable to this Lease (check one)
Location of Unit(s): 89 U.S. HWY. 380, WHITE SANDS MISSILE RANGE
SAN ANTONIO, NM 87832
ADDITIONAL PROVISIONS RIDERS:
FLEX OPTION AMENDMENT NO. 1
ENGINE APPLICATION SURVEY
TERMS AND CONDITIONS
1. LEASE TERM: The lease term for each Unit shall start on its Delivery Date
(the date (a) Lessor executes this Lease, (b) Lessor takes title to the Unit, or
(c) Lessee or its agent takes control of physical possession of the Unit,
whichever is latest), provided the Delivery Date is not on or before the
utilization date stated above, and shall continue for the number of months
stated above. If the Delivery Date is not on or before the utilization date
Lessee shall, at the option of Lessor, assume Lessor's obligations to purchase
and pay for the Unit. Lessee shall execute and send Lessor's delivery supplement
to Lessor promptly after delivery of a Unit.
2. RENT: Lessee shall pay to Lessor, at the address stated above or such other
location Lessor designates in writing, rent for each Unit as stated above
starting (a) on its Delivery Date if the rent is to be paid in advance, or (b)
one month (or other period as stated above) after its Delivery Date if the rent
is to be paid in arrears. An amount equal to the first rent payment for each
Unit must accompany this document when it is submitted to Lessor. If Lessor
executes this document, the amount shall be the first rent payment. If Lessor
does not execute this document, the amount shall be returned to Lessee. If
Lessor does not receive a rent payment on the date it is due, Lessee shall pay
to Lessor, on demand, a late payment charge equal to five percent (5%) of the
rent payment not paid when due or the highest charge allowed by law, whichever
is less.
3. NO ABATEMENT: Lessee shall not be entitled to abatement or reduction of
rent or setoff against rent for any reason whatsoever. Except as otherwise
provided, this Lease shall not terminate because of, nor shall the obligations
of Lessor or Lessee be affected by damage to, any defect in, destruction of, or
loss of possession or use of a Unit; the attachment of any lien, security
interest or other claim to a Unit; any interference with Lessee's use of a Unit;
Lessee's insolvency or the commencement of any bankruptcy or similar proceeding
by or against Lessee, or any other cause whatsoever.
4. DISCLAIMER OF WARRANTIES: Lessee acknowledges and agrees that (a) each Unit
is of a size, design and make selected by Lessee, (b) each Unit is suitable for
Lessee's purposes, (c) each Unit contains all safety features deemed necessary
by Lessee, (d) Lessor is not the manufacturer of any Unit, (e) the vendor of any
Unit is not an agent of Lessor, and (f) LESSOR HAS NOT MADE, AND DOES NOT HEREBY
MAKE, ANY REPRESENTATION OR WARRANTY, EXPRESSED OR IMPLIED, WITH RESPECT TO THE
MERCHANTABILITY, CONDITION, QUALITY, DESCRIPTION, OR DURABILITY OF A UNIT, OR
ITS FITNESS FOR A PARTICULAR PURPOSE. Lessor assigns to Lessee, to the extent
assignable, any warranties of a Unit by its manufacturers and/or vendor,
provided that any action taken by Lessee by reason thereof shall be at the
expense of the Lessee.
5. POSSESSION, USE AND MAINTENANCE: Lessee shall not (a) use, operate,
maintain or store a Unit improperly, carelessly, unsafely or in violation of any
applicable law or regulation or for any purpose other than in the conduct of
Lessee's business; (b) abandon a Unit; (c) sublease a Unit, permit the use of a
Unit by anyone other than Lessee, change the user of unit from that specified in
the Application Survey/Usage Rider attached hereto, or change the location of a
Unit from that specified above, without the prior written consent of Lessor; or
(d) create or allow to exist any lien, claim, security interest or encumbrance
on any of its rights hereunder of a Unit. A Unit is and shall remain personal
property regardless of its use or manner of attachment to realty. Lessor and its
agent shall have the right (but not the obligation) to inspect a Unit and
maintenance records relating to it and observe its use. Lessee, at its expense,
shall maintain each Unit in good operating order, repair and condition and shall
perform maintenance at least as frequently as stated in any applicable
operator's guide, service manual, or lubrication and maintenance guide. Lessee
shall not alter any Unit or affix any accessory or equipment to it if doing so
will impair its originally intended function or use or reduce its value. Any
alteration or addition to a Unit shall be the responsibility of and at the sole
risk of Lessee. All parts, accessories and equipment affixed to a Unit shall be
subject to the security interest of Lessor.
SEE REVERSE SIDE FOR ADDITIONAL TERMS AND CONDITIONS
Lessee: MEADOW VALLEY LESSOR: CATERPILLAR FINANCIAL SERVICES
CONTRACTORS, INC. CORPORATION
By: /s/ Gary W. Burnell By: /s/ Evelyn Martinez
---------------------------- ---------------------------------------
Name (PRINT) GARY W. BURNELL Name (PRINT) EVELYN MARTINEZ
--------------------- -----------------------------
Title VP/CFO Title CREDIT ANALYST
-------------------------- ---------------------------------
Date 6/2/98 Date JUN 1 1998
--------------------------- ----------------------------------
<PAGE>
6. TAXES: Lessee shall promptly pay or reimburse Lessor for all fees, charges
and taxes of any nature, including, without limitation, personal property taxes,
together with any penalties, fines or additions to tax and interest thereon
(collectively, "Taxes") levied on or assessed against Lessor in connection with
the ownership, leasing, rental, sale, possession, purchase, or use of a Unit;
excluding however, all charges or taxes on or measured by Lessor's net income,
or charges or taxes levied on or assessed against Lessor in connection with a
Unit after the Unit is returned to Lessor in accordance with the terms of this
Lease. If the reimbursement to Lessor of Taxes constitutes income for federal,
state or local tax purposes and if the Lessor is not entitled to a deduction for
the full amount of the reimbursement, the Lessee shall pay the Lessor an
additional amount such that the net amount received by Lessor after payment of
all related Taxes equals the amount which Lessor would have received if no such
Taxes were payable. Lessee shall prepare and timely file, in a manner
satisfactory to Lessor, any reports or returns which may be required with
respect to a Unit, including, without limitation, personal property tax returns.
For purposes of this section, in computing Lessor's Taxes attributable to a
reimbursement, it shall be assumed that the Lessor is in the highest marginal
tax rate applicable to corporations at the time the reimbursement is made, and
that the term "Lessor" shall include any affiliated group, within the meaning of
Section 1504 of the Internal Revenue Code of 1988, of which Lessor is a member
for any year in which a consolidated or combined income tax return is filed for
the affiliated group.
7. LOSS OR DAMAGE: Lessee shall bear the risk, of any Casualty Occurrence (the
Unit is worn out, lost, stolen, destroyed, taken by government action or, in
Lessor's opinion, irreparably damaged) or other damage from the time is it
purchased by Lessor until it is returned to Lessor. Lessee shall give Lessor
prompt notice of a Casualty Occurrence or other damage. If, in Lessor's opinion,
the damage is not a Casualty Occurrence, Lessee shall, at its expense, promptly
restore the Unit to the condition required by Section 5. If a Casualty
Occurrence, Lessee shall pay to Lessor on the first rent payment date following
the Casualty Occurrence (thirty (30) days after the Casualty Occurrence if there
is no rent payment date remaining) the lessor of (a) the sum of (i) all amounts
then due under this Lease with respect to the Unit, (ii) the present value of
all unpaid rent for the Unit, and (iii) the present value of the Purchase Price
of the Unit as stated on the front hereof; and (b) the maximum amount permitted
by law. Present values will be determined by discounting at the implicit
interest rate of this Lease. Upon making this payment, the lease term with
respect to the Unit shall terminate and Lessee shall be entitled to possession
of the Unit and to any recovery in respect to it (subject to the rights of any
insurer).
8. WAIVER AND INDEMNITY: LESSEE AGREES TO DEFEND, INDEMNIFY AND HOLD LESSOR,
ITS EMPLOYEES, DIRECTORS AND OFFICERS HARMLESS FROM AND AGAINST ANY AND ALL
CLAIMS OF LESSEE AND/OR THIRD PARTIES (INCLUDING, BUT NOT LIMITED TO, CLAIMS
RELATING TO PATIENT INFRINGEMENT, BASED UPON STRICT LIABILITY IN TORT AND FOR
CONSEQUENTIAL DAMAGES), LOSSES, LIABILITIES, DEMANDS, SUITS, JUDGMENTS AND
CAUSES OF ACTION, AND ANY COSTS OR EXPENSES IN CONNECTION THEREWITH, INCLUDING
REASONABLE ATTORNEYS' FEES AND EXPENSES, WHICH MAY RESULT FROM OR ARISE IN ANY
MANNER OUT OF THE DELIVERY (INCLUDING ANY DELAY IN, OR FAILURE OF, DELIVERY),
SELECTION, PURCHASE, ACCEPTANCE OR REJECTION, OWNERSHIP, POSSESSION, CONDITION,
USE, OPERATION, MAINTENANCE OR REPAIR OF A UNIT FROM THE TIME IT IS PURCHASED BY
LESSOR UNTIL IT IS RETURNED TO LESSOR, OR WHICH MAY BE ATTRIBUTABLE TO A DEFECT
IN THE UNIT, THE MATERIAL USED THEREIN OR THE DESIGN, MANUFACTURE OR TESTING
THEREOF, REGARDLESS OF WHEN THE DEFECT IS DISCOVERED, WHETHER OR NOT THE UNIT IS
IN THE POSSESSION OF LESSEE AND WHERE IT IS LOCATED.
9. INSURANCE: Lessee, at its expense, shall keep each Unit insured for the
benefit of Lessor against all risks for not less than the amount described in
Section 7 and shall maintain comprehensive public liability insurance (including
product and broad form contractual liability) covering the Unit for not less
than $1,000,000 combined coverage for bodily injury and property damage. All
insurance shall be in a form and with companies as Lessor shall approve, shall
specify Lessor and Lessee as name insured, shall be primary, without the right
of contribution from any other insurance carried by Lessor, and shall provide
that the insurance may not be canceled or altered so as to affect the interest
of Lessor without at Least to (10) days' prior written notice to Lessor. All
insurance covering loss or damage to a Unit shall name Lessor as loss payee.
Lessee shall not make adjustments with insurers except with Lessor's prior
written consent and hereby irrevocably appoints Lessor as Lessee's
attorney-in-fact to receive payment of and to endorse all checks, drafts and
other documents and to take any other actions necessary to pursue insurance
claims and recover payments if Lessee fails to do so. Lessee shall promptly
notify Lessor of any occurrence which may become the basis of a claim and shall
provide Lessor with all requested pertinent data. Lessee shall promptly deliver
to Lessor evidence of such insurance coverage.
10. EVENTS OF DEFAULT: Each of the following constitutes an event of default
("Event of Default"): (a) Lessee fails to make any payment when due; (b) any
representation or warranty to Lessor which is incorrect or misleading; (c)
Lessee fails to observe or perform any covenant, agreement or warranty made by
Lessee and the failure continues for ten (10) days after written notice to
Lessee; (d) any default occurs under any other agreement between Lessee and
Lessor or any affiliate of Lessor; (e) Lessee or any guarantor of this Lease
ceases to do business, becomes insolvent, makes an assignment for the benefit of
creditors or files any petition or action under any bankruptcy, reorganization,
insolvency or moratorium law, or any other law or laws for the relief of, or
relating to, debtors; (f) filing of any involuntary petition under any
bankruptcy statute against Lessee or any guarantor of this Lease, or appointment
of a receiver, trustee, custodian or similar official to take possession of the
properties of Lessee or any guarantor of this Lease, unless the petition or
appointment ceases to be in effect within thirty (30) days after filing or
appointment; and (g) breach or repudiation of a guaranty obtained by Lessor in
connection with the Lease.
11. REMEDIES: If an Event of Default occurs, Lessor may (a) proceed by court
action to enforce performance by Lessee of the covenants of this Lease or to
recover damages for their breach or (b) by notice in writing to Lessee terminate
this Lease, in which event Lessee shall remain liable as provided herein and
Lessor may do any one or more of the following: (i) declare the balance due (or
the maximum amount permitted by law if recovery of the entire balance due is
prohibited) with respect to each Unit immediately due and payable and recover
any additional damages and expenses sustained by Lessor due to breach of any
covenant, representation or warranty in this Lease other than for the payment of
rent; (ii) enforce the security interest granted herein; (iii) require Lessee to
return each Unit pursuant to Section 12; and (iv) enter the premises where any
Unit may be and take possession of it without notice, liability or legal
process. Lessee agrees to pay all charges, costs, expenses and reasonable
attorney's fees incurred by Lessor in enforcing this Lease. Lessor has all
rights given to a secured party by law. Lessor may undertake commercially
reasonable efforts to sell or release a Unit, and the proceeds of any sale or
re-lease shall be applied in the following order: (i) to reimburse Lessor for
all expenses of retaking, holding, preparing for sale or re-lease and selling or
re-leasing the Unit, including any taxes, charges, costs, expenses and
reasonable attorney's fees incurred by Lessor; (ii) to pay Lessor all amounts
which under the terms of this Lease are due or have accrued as of the date of
Lessor's receipt of the proceeds; and (iii) to pay Lessor the balance due (or
the maximum amount permitted by law if recovery of the entire balance due is
prohibited) with respect to the Unit. Any surplus shall be paid to the person
entitled to it. Lessee shall promptly pay any deficiency to Lessor. Lessee
acknowledges that sales for cash or credit to a wholesaler, retailer or user of
a Unit are all commercially reasonable. The remedies provided to Lessor shall be
cumulative and shall be in addition to all other remedies existing at law or in
equity. If Lessee fails to perform any of its obligations under this Lease,
Lessor may perform the obligations, and the expenses incurred by Lessor as a
result shall be payable by Lessee upon demand.
12. RETURN OF UNIT: If Lessor shall rightfully demand possession of a Unit,
Lessee, at its expense, shall promptly deliver possession of the Unit to Lessor,
properly protected and in the condition required by Section 5, at the option of
Lessor, (a) to the premises of the nearest Caterpillar dealer selling equipment
of the same type as the Unit, or (b) on board a carrier named by Lessor an
shipping it, freight collect, to the destination designated by Lessor. If the
Unit is not in the condition required by Section 5, Lessee shall pay to Lessor,
on demand, all costs and expenses incurred by Lessor to bring the Unit into the
required condition.
13. MANDATORY FINAL PAYMENT: If the Mandatory Final Payment box is checked, at
the end of lease term with respect to a Unit, provided this Lease has not been
terminated with respect to it, Lessee shall pay the Final Payment stated on the
front hereof. Upon receipt of the Final Payment, and all other amounts due under
this Lease, plus an amount equal to any taxes due in connection with the
transfer of the Unit or the delivery of the bill of sale, Lessor shall deliver
to Lessee, upon request, a bill of sale without warranties except that the Unit
is free of all encumbrances of any person claiming through Lessor. Lessee shall
purchase the Unit "AS IS, WHERE IS, WITH ALL FAULTS."
14. OPTIONAL FINAL PAYMENT: If the Optional Final Payment box is checked and
if no Event of Default shall have occurred and be continuing, Lessee may, by
notice delivered to Lessor not less than sixty (60) days prior to the end of the
lease term with respect to a Unit, elect to pay the Final Payment stated on the
front. Payment of the Final Payment shall be due at the end of the lease term.
Upon payment of the Final Payment and all other amounts due under this Lease,
plus an amount equal to any taxes due in connection with the transfer of the
Unit or the delivery of the bill of sale, Lessor shall deliver to Lessee, upon
request, a bill of sale without warranties except that the Unit is free of all
encumbrances of any person claiming through Lessor. Lessee shall purchase the
Unit "AS IS, WHERE IS, WITH ALL FAULTS". If Lessee does not elect to pay the
Final Payment, Lessee, upon expiration of the lease term, shall return the Unit
to Lessor as provided in Section 12 and furnish Lessor with documentation, as
Lessor may reasonably request, conveying to Lessor all of Lessee's right, title
and interest in the Unit, free and clear of all liens, claims, security
interests and encumbrances other than those of Lessor.
15. SECURITY INTEREST; LESSEE REPRESENTATIONS: Unless applicable law provides
otherwise, title to a Unit shall remain in Lessor as security for the
obligations of Lessee hereunder until Lessee has fulfilled all of its
obligations. Lessee hereby grants to Lessor a continuing security interest in
the Unit, including all attachments, accessories and optional features therefor
(whether or not installed thereon) and all substitutions, replacements,
additions, and accessions thereto, and proceeds of all of the foregoing, to
secure the payment of all sums due hereunder. Lessee will, at its expense, do
any act and execute, acknowledge, deliver, file, register and record any
documents which Lessor may reasonably request to protect Lessor's security
interest in the Unit and Lessor's rights and benefits under this Lease. Lessee
represents and warrants to Lessor that (a) Lessee has the power to make, deliver
and perform under this Lease; (b) the person executing and delivering this Lease
is authorized to do so on behalf of Lessee, and (c) this Lease constitutes a
valid obligation of Lessee, legally binding upon it and enforceable in
accordance with its terms. Lessee shall, display labels supplied by Lessor
stating that the Unit is leased from Lessor in a prominent place on the Unit
during the lease term.
16. ASSIGNMENT; COUNTERPARTS: The rights of Lessor under this Lease and title
to the Unit may be assigned by Lessor at any time. If notified by Lessor, Lessee
shall make all payments due under this Lease to the party designated in the
notice, without offset or deduction. No assignment of this Lease or any right or
obligation under it may be made by Lessee without the prior written consent of
Lessor. This Lease shall be binding upon and benefit Lessor and Lessee and their
respective successors and assigns. If this Lease is assigned by Lessor to a
partnership or trust, the term "Lessor" shall thenceforth means and include the
partnership or trust and shall also include, for purposes of Sections 4, 5, 6,
7, 8 and 9, each partner in or beneficiary of the partnership or trust. Although
multiple counterparts of this document may be signed, only the counterpart
accepted, acknowledged and certified by Caterpillar Financial Services
Corporation on the signature page thereof as the original will constitute
original chattel paper.
17. EFFECT OF WAIVER; ENTIRE AGREEMENT; MODIFICATION OF LEASE; NOTICE: A delay
or omission by Lessor to exercise any right or remedy shall not impair any right
or remedy and shall not be construed as a waiver of any breach or default. Any
waiver or consent by Lessor must be in writing. This Lease completely states the
rights of Lessor and Lessee and supersedes all prior agreements with respect to
the Unit. No variation or modification of this Lease shall be valid unless in
writing. All notices shall be in writing, addressed to the other party at the
address stated on the front or at such other address as may hereafter be
furnished in writing.
18. SEVERABILITY; SURVIVAL OF COVENANTS: If any provision of this Lease shall
be invalid under any law, it shall be deemed omitted but the remaining
provisions hereof shall be given effect. All obligations of Lessee under this
Lease shall survive the expiration or termination of this Lease to the extent
required for their full observance and performance.
<PAGE>
EXHIBIT 10.83
CLARK COUNTY, NEVADA
BID PROPOSAL
BID NO.4106-97
SOUTHERN SEGMENT, LAS VEGAS BELTWAY, SECTION 4, GREEN VALLEY PARKWAY TO U.S. 95
REVISED PER ADDENDUM NO.6
-------------------------
MEADOW VALLEY CONTRACTORS, INC.
- -------------------------------------------------------------------------------
(NAME)
P.O. BOX 549, MOAPA, NEVADA 89025
- -------------------------------------------------------------------------------
(ADDRESS)
THE UNDERSIGNED PROPOSES AND AGREES:
1. To complete all work for which a contract may be awarded to the Bidder and
to furnish any and all labor, equipment, materials, transportation, and
other facilities required for the services as set forth in the Proposal and
Contract Documents.
2. That the Bidder has examined the Contract Documents and the site(s) for the
proposed work and satisfied themselves as to the character, quality of work
to be performed, materials to be furnished and as to the requirements of
the specifications.
3. That the Bidder has completed all information in the blanks provided and
has submitted the following within this bid proposal:
A. Each subcontractor which will be paid an amount exceeding five
percent (5%) of the total bid amount.
B. Has represented their qualification for Preferential Bidder Status.
C. Has submitted a bid security (in the form of, at Bidder's option, A
Cashiers Check, Certified Check, Money Order, or Bid Bond in favor of
the Owner(s) in the amount of Five Percent (5%) of the bid amount.
4. If the Bidder is one of the three (3) apparent low bidders at the bid
opening, they must submit Bid Attachment 2 within two hours after
completion of the bid opening. Faxing is not allowed. This Attachment must
----
be time stamped by the Department of General Services. Submission after the
-----------------------------------------------------
two (2) hour time limit will be rejected and/or returned unopened and the
bid may be deemed non-responsive.
A. Projects EXCEEDING Five Million Dollars ($5,000,000)
---------
1. The Bidders shall list subcontractors which will provide
labor/improvements exceeding one percent (1%) of the prime
contractor's total bid amount, or $50.000.00, whichever is greater.
5. Upon faxed receipt of a letter of intent to Award the contract, the bidder
will provide the following submittals within seven (7) days from receipt of
the Notice.
A. Performance Bond, Labor and Material Payment Bond and a Guaranty
Bond, for One Hundred Percent (100%) of the contract price as
required
B. Certificates of insurance for Commercial General Liability in the
amount of $1,000,000, Automobile Liability in the amount of
$1,000,000. Explosion, Collapse and Underground in the amount of
$1,000,000 Installation Floater and a SIIS certificate as required by
law.
6. That if the Bidder does not provide the above submittals on or before the
seventh (7th) calendar day, or does not keep the bonds or insurance
policies in effect or allows them to lapse, the Bidder will pay over to the
Owner the amount of six thousand five hundred dollar; ($6,500.00) per day
as liquidated damages.
7. That this Proposal is genuine and is not sham or collusive, or made in the
interest of, or on behalf of any person not herein named, nor the Bidder in
any mariner sought to secure for themselves an advantage over any other
bidder.
<PAGE>
BID PROPOSAL
Bid No. 4106-97
REVISED PER ADDENDUM NO. 6
Southern Segment, Las Vegas Beltway
14. CLAIM OF PREFERENTIAL BIDDER STATUS
-----------------------------------
Bidder hereby claims that their firm has paid the sale and use tax and/or
the motor privilege vehicle tax for each consecutive 12-month period for
sixty (60) months immediately preceding the submission of this bid in the
amounts necessary to qualify for the preferential bidder status pursuant to
NRS 338.147.
IF BIDDER DOES NOT QUALIFY FOR PREFERENTIAL BIDDER STATUS, CHECK HERE |__|.
15. FOR INFORMATIONAL PURPOSES ONLY:
-------------------------------
The General Contractor submitting this bid is a [_] MBE [_] WBE [_] PBE
[_] SBE [_] NBE [_] LBE as defined in the instructions to Bidders.
16. /s/ Alan Terril MEADOW VALLEY CONTRACTORS, INC.
---------------------------- --------------------------------------
SIGNATURE OF BIDDER LEGAL NAME OF FIRM AS IT WOULD APPEAR IN
CONTRACT
ALAN TERRIL 702-864-2575 702-864-2580
---------------------------- --------------- ------------------
NAME OF BIDDER (PRINT OR TYPE) TELEPHONE NUMBER FAX NUMBER
P.O. BOX 549 # 0019258
---------------------------- --------------------------------------
ADDRESS OF FIRM NEVADA STATE CONTRACTOR'S LICENSE NO.
MOAPA, NV 89025 A UNLIMITED
---------------------------- --------------- ------------------
CITY, STATE, ZIP CODE CLASSIFICATION MONETARY LIMITATIONS,
IF ANY
2/26/98 BUSINESS LICENSE:
---------------------------- [X] CLARK COUNTY - NO. 041648-240-8
-------------
TODAY'S DATE [X] CITY OF LAS VEGAS - NO. 59416
-------------
<PAGE>
Bid Proposal
Bid No. 4106-97
Revised per Addendum No.6
Southern Segment, Las Vegas Beltway
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
APPROX.
ITEM NUMBER ITEM DESCRIPTION QUANTITY UNIT UNIT BID PRICE TOTAL
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
630 0009 STEPHANIE STREET SANITARY SEWER IMPROVEMENTS 1 L.S. $ 39,405.00 $ 39,405.00
- ------------------------------------------------------------------------------------------------------------------------------------
633 0000 NON-REFLECTIVE PAVEMENT MARKERS 3,857 EA. $ 1.60 $ 6,171,20
- ------------------------------------------------------------------------------------------------------------------------------------
633 0004 REFLECTIVE PAVEMENT MARKERS 1,780 EA. $ 2.66 $ 4,734.80
- ------------------------------------------------------------------------------------------------------------------------------------
633 0653 EPOXY PAINT STRIPING (4-INCH SOLID WHITE) 2.04 MILE $ 2,130.00 $ 4,345.20
- ------------------------------------------------------------------------------------------------------------------------------------
633 0655 EPOXY PAINT STRIPING (8-INCH BROKEN WHITE) 6.35 MILE $ 532.50 $ 3,381.38
- ------------------------------------------------------------------------------------------------------------------------------------
633 0656 EPOXY PAINT STRIPING (8-INCH SOLID WHITE) 7.63 MILE $ 3,727.50 $ 28,440.83
- ------------------------------------------------------------------------------------------------------------------------------------
633 0660 EPOXY PAINT STRIPING (8-INCH SOLID YELLOW) 7.61 MILE $ 3,727.50 $ 28,366.28
- ------------------------------------------------------------------------------------------------------------------------------------
633 0661 EPOXY PAINT STRIPING (8-INCH DOTTED WHITE) 100 L.F. $ 2.13 $ 213.00
- ------------------------------------------------------------------------------------------------------------------------------------
633 0662 EPOXY PAINT STRIPING (12-INCH SOLID WHITE) 2.63 MILE $ 6,469.88 $ 17,015.78
- ------------------------------------------------------------------------------------------------------------------------------------
641 0600 IMPACT ATTENUATOR (QUADGUARD QS 2406G WITH 1 EA. $ 26,625.00 $ 26,625.00
CONCRETE BACKUP. QG)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL $29,392,720.68
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
twenty nine million three hundred ninety two thousand seven hundred twenty
dollars and sixty eight cents.
- --------------------------------------------------------------------------------
(TOTAL IN WORDS)
<PAGE>
EXHIBIT 10.84
CONTRACT AGREEMENT
THIS AGREEMENT, made and entered into this 25TH day of MARCH, 1998 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 052 H473201C RAM 600-I-547
PIMA FREEWAY (SR 101L) (PHOENIX URBAN AREA)
(Pima-Red Mountain Traffic Interchange Phase IV)
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 if 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 forces 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.
<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 unacceptable 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 is 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 the 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 052 H473201C RAM 600-1-547
PIMA FREEWAY (SR 101L) (PHOENIX URBAN AREA)
(Pima-Red Mountain Traffic Interchange Phase IV)
Witness or hands and seals this 25th day of March 1998
STATE OF ARIZONA
By: /s/ SIGNATURE
------------------------------------
Department of Transportation
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: /s/ Bradley E. Larson
------------------------------------
Contractor BRADLEY E. LARSON PRESIDENT
Attest: /s/ Robert W. Bottcher PARTY OF THE SECOND PART
---------------------------
Seal
<PAGE>
Page 19 of 19
<TABLE>
<CAPTION>
BID SCHEDULE
101L MA 052 H473201C
- ---------------------------------------------------------------------------------------------------------------------------------
ITEM NO ITEM DESCRIPTION UNIT QUANTITY UNIT PRICE EXTENDED AMOUNT
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
BRIDGE 2379 - RAMP W - S OVER RED MOUNTAIN FREEWAY (APPROACH AND ANCHOR SLABS)
- ---------------------------------------------------------------------------------------------------------------------------------
2030506 1 STRUCTURE BACKFILL CU.YD. 140 28.00 3,920.00
- ---------------------------------------------------------------------------------------------------------------------------------
6011105 1 BRIDGE CONCRETE BARRIER, TYPE B L.FT. 156 32.00 4,992.00
- ---------------------------------------------------------------------------------------------------------------------------------
6011352 1 DECK JOINT ASSEMBLY (B-24.20 3X3 COMPRESSION SEAL) L.FT. 56 90.00 5,040.00
- ---------------------------------------------------------------------------------------------------------------------------------
6011365 1 APPROACH SLAB (B-19.11) SQ.FT. 840 9.00 7,560.00
- ---------------------------------------------------------------------------------------------------------------------------------
6011366 1 APPROACH SLAB (B-19.12) SQ.FT. 2,166 10.00 21,660.00
- ---------------------------------------------------------------------------------------------------------------------------------
9210007 1 SLOPE PAVING (EXPOSED AGGREGATE) SQ.YD. 985 30.00 29,550.00
- ---------------------------------------------------------------------------------------------------------------------------------
BID TOTAL: 10,995,812.95
</TABLE>
<PAGE>
EXHIBIT 10.85
New Mexico State Highway and Transportation Department
PROPOSAL
OF
NAME MEADOW VALLEY CONTRACTORS, INC. TELEPHONE NO. (602) 437-5400
ADDRESS P.O. BOX 60726 PHOENIX, AZ 85082-0726
*CONTRACTOR'S LICENSE NO. 057280 *LICENSE CLASSIFICATION GA98, GF01, GF02
*RESIDENT BIDDER CERTIFICATE NO.___________________________________________
*Not Required for Bidding on Federal-Aid Projects
TO THE STATE HIGHWAY AND TRANSPORTATION DEPARTMENT:
The undersigned proposes to construct this project in accordance with the State
Highway and Transportation Department's current Standard Specifications for Road
and Bridge Construction, the plans, the Special Provisions, the Specifications
and all other contract documents and certificates to furnish and deliver all the
material and to do all work and labor required for the construction of New
Mexico Project No. SP-4916(200) in Otero County, New Mexico on Road No.
Alamogoroo Relief Route CN 1970 being about 0.503 miles in length, at the prices
stated in the Proposal Schedule. The undersigned also certifies that he has
examined the site of the proposed work, the material pits, the haul roads, the
proposal, the plans, the specifications, the Special Provisions and all other
contract documents before submitting the bid and is satisfied as to the
requirements therein.
As further consideration for the award of this contract, the undersigned agrees
to the following terms, conditions and acknowledgements:
1. To execute the standard form contract and to furnish a contract bond in the
amount of One Hundred Percent (100%) of the total bid price of this proposal
within fifteen (15) days after receiving notification of the acceptance of this
proposal, and failing to do so, to forfeit the accompanying check or proposal
bond to the State as liquidated damages, and the Secretary of Highways and
Transportation may proceed to award the contract to others.
2. To commence work within 15 days, or such additional time as may be allowed
in writing by the Secretary of Highways and Transportation, after notification
of award of contract, and to complete the contract as awarded in (335) working
days.
3. To furnish a performance and payment bond in the penalty of full amount of
contract as surety conditioned for the full, complete and faithful performance
of this contract.
4. The undersigned declares that he is the only person or party interested in
the proposal as principal and that its officers, employees, subsidiaries or
parent corporations (check box a., b., or c. as appropriate):
(x) a. have not in any way participated in any activities in restraint of trade,
or been debarred with relation to public contracts either in the State of New
Mexico or any other State of the United States or on any federally-assisted
contract during the five year period immediately preceding this proposal or
either directly entered into any agreement, participated in any collusion or
otherwise take any action in restraint of free competitive bidding in connection
with this contract.
( ) b. have participated in activities in restraint of trade with relation to
public contracts either in the State of New Mexico or any other State of the
United States or on any federally assisted contracts during the five-year period
immediately preceding this proposal or entered into collusion, or restraint of
free competitive bidding on this contract, and are of the opinion that they are
a responsible bidder entitled to the award of a contract involving public moneys
and attach hereto an explanation of their activities in restraint of free trade,
restraint of free competitive bidding, or collusion.
( ) c. The contractor has the option to submit an unsworn non collusion
declaration, under penalty of perjury under the laws of the United States. See
Form No. A-870 - Declaration of Non Collusion for Award of Contract. Activities
in restraint of trade include those set forth in New Mexico Statutes Armotated,
Section 57-1-1 (1978 Edition as amended, and following). The undersigned
declares that this section has been read and is fully understood.
5. In accordance with the contract, plans and specifications; repair, maintain
and guarantee all work performed thereunder until accepted by the Secretary of
Highways and Transportation.
<PAGE>
6. To indemnify and save harmless the State Highway and Transportation
Department from any damage or loss for which the Department may become liable by
the default of said Contractor, or by reason of any neglect or carelessness on
the part of said Contractor, his agents or employees, or by on account of any
act of omission of said Contractor, his servants, agents or employees, in the
performance of this contract.
7. The established DB goal for this project is 0%.
In accordance with 49 CFR Part 23, the Department's Disadvantaged Business
Assistance Program, the applicable Special Provisions, modification to the
Special Provisions, the undersigned (Check a., b., c. as appropriate):
(X) a. Assures to meet or exceed the established DB goal.
( ) b. Cannot meet the established DB goal and assures to meet or exceed a DB
goal of ______%. All documentation indicating the good faith efforts to meet the
established DB goal will be submitted within five (5) working days following the
bid opening.
( ) c. Is a Department certified Disadvantaged Business.
8. The undersigned, as the apparent low bidder, further assures that he will
submit Form A-585, DBA-1 (for federally funded projects) within five (5) working
days following the bid opening to the Department's Disadvantaged Business
Assistance Section. Failure to submit this form within the specified time shall
render the bid non-responsive. If 8.c is checked above, the contractors is not
required to submit Form A-585, DBA-1.
9. The bidder, hereby certifies that he has (X) has not ( ), participated in a
previous contract or subcontract subject to the equal opportunity clause, as
required by Executive Orders 11246, 10925 and 11114 as amended, and that he has
(X), has not ( ), filed with the Office of Federal Contract Compliance Program
all reports due under the applicable filing requirements.
10. We acknowledge the receipt of the following Addenda:
NO. DATE NO. DATE
2 4/9/98
______________________________________________________________________________
______________________________________________________________________________
11. The undersigned agrees that any and all claims that the undersigned may have
for overcharges resulting from antitrust violations as to goods, services and
materials purchased in connection with this bid are hereby assigned to the State
of New Mexico, but only to the extent that such overcharges are passed on to the
State. The undersigned further agrees to require its Subcontractors to assign
any and all such claims for overcharges to the State, but only to the extent
such overcharges are passed on to the State, by executing an assignment on a
form obtainable from the Engineer prior to the commencement of work by a
Subcontractor. The undersigned retains all rights to any such antitrust claims
to the extent of any overcharges not passed on to the State.
12. The undersigned tenders herewith, as a proposal guarantee for which receipt
has been given, a certified check, bid bond, cashier's check, postal money order
or bank money order in the amount of at least 5% of the amount bid drawn to the
order of the New Mexico State Transportation Department.
MEADOW VALLEY CONTRACTORS, INC.
- -------------------------------
Organization
By: /s/ Robert W. Bottcher
----------------------------
Title: AREA MANAGER
-------------------------
SUBSCRIBED AND SWORN TO ME ON THIS:
9 DAY OF APRIL, 1998
MY COMMISSION EXPIRES:
[OFFICIAL SEAL APPEARS HERE]
<PAGE>
NEW MEXICO STATE HIGHWAY AND DATE: 03/16/98
TRANSPORTATION DEPARTMENT TIME: 13:44
PAGE: 16
<TABLE>
<CAPTION>
PROJECT(S) : SP-4916(200)
- --------------------------------------------------------------------------------
LINE ITEM APPROX. UNIT PRICE BID AMOUNT
------------ -------------
NO DESCRIPTION QUANTITY
AND UNITS DOLLARS CTS DOLLARS CTS
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
562110 POLYMER BRIDGE
1480 JOINT SEALS, TYPE B 256.000
L.F. 180.00 46080.00
- --------------------------------------------------------------------------------
601000 REMOVAL OF
1490 STRUCTURES AND LUMP LUMP
OBSTRUCTIONS 49999.95
- --------------------------------------------------------------------------------
607077 PEDESTRIAN
1500 SCREENING FENCE, TYPE 2 422.000
L.F. 150.00 63300.00
- --------------------------------------------------------------------------------
709020 RIGID ELECTRICAL
1510 CONDUIT 2" (DIA.) 660.000
L.F. 3.00 1980.00
- --------------------------------------------------------------------------------
SECTION 0002 TOTAL 1,602,715.35
- --------------------------------------------------------------------------------
TOTAL BID 6,854,760.00
- --------------------------------------------------------------------------------
</TABLE>
<PAGE>
EXHIBIT 10.86
New Mexico State Highway and Transportation Department
PROPOSAL
OF
NAME MEADOW VALLEY CONTRACTORS, INC. TELEPHONE NO. (602) 437-5400
ADDRESS P.O. BOX 60726 PHOENIX, AZ 85082-0726
*CONTRACTOR'S LICENSE NO. 057280 *LICENSE CLASSIFICATION GA98, GF01 & GF02
*RESIDENT BIDDER CERTIFICATE NO.____________________________________________
*Not Required for Bidding on Federal-Aid Projects
TO THE STATE HIGHWAY AND TRANSPORTATION DEPARTMENT:
The undersigned proposes to construct this project in accordance with the State
Highway and Transportation Department's current Standard Specifications for Road
and Bridge Construction, the plans, the Special Provisions, the Specifications
and all other contract documents and certifies to furnish and deliver all the
material and to do all work and labor required for the construction of New
Mexico Project No. TPA-(TPO)-0048(10) in LINCOLN County, New Mexico on Road No.
NM 48 CN 0999R being about 2.616 miles in length, at the prices stated in the
Proposal Schedule. The undersigned also certifies that he has examined the site
of the proposed work, the material pits, the haul roads, the proposal, the
plans, the specifications, the Special Provisions and all other contract
documents before submitting the bid and is satisfied as to the requirements
therein.
As further consideration for the award of this contract, the undersigned agrees
to the following terms, conditions and acknowledgements:
1. To execute the standard form contract and to furnish a contract bond in the
amount of One Hundred Percent (100%) of the total bid price of this proposal
within fifteen (15) days after receiving notification of the acceptance of this
proposal, and failing to do so, to forfeit the accompanying check or proposal
bond to the State as liquidated damages, and the Secretary of Highways and
Transportation may proceed to award the contract to others.
2. To commence work within 15 days, or such additional time as may be allowed
in writing by the Secretary of Highways and Transportation, after notification
of award of contract, and to complete the contract as awarded in (295) working
days.
3. To furnish a performance and payment bond in the penalty of full amount of
contract as surety conditioned for the full, complete and faithful performance
of this contract.
4. The undersigned declares that he is the only person or party interested in
the proposal as principal and that its officers, employees, subsidiaries or
parent corporations (check box a., b., or c. as appropriate):
(x) a. have not in any way participated in any activities in restraint of trade,
or been debarred with relation to public contracts either in the State of New
Mexico or any other State of the United States or on any federally-assisted
contract during the five year period immediately preceding this proposal or
either directly entered into any agreement, participated in any collusion or
otherwise take any action in restraint of free competitive bidding in connection
with this contract.
( ) b. have participated in activities in restraint of trade with relation to
public contracts either in the State of New Mexico or any other State of the
United States or on any federally assisted contracts during the five-year period
immediately preceding this proposal or entered into collusion, or restraint of
free competitive bidding on this contract, and are of the opinion that they are
a responsible bidder entitled to the award of a contract involving, public
moneys and attach hereto an explanation of their activities in restraint of free
trade, restraint of free competitive bidding, or collusion.
( ) c. The contractor has the option to submit an unsworn non collusion
declaration, under penalty of perjury under the laws of the United States. See
Form No. A-870 - Declaration of Non Collusion for Award of Contract. Activities
in restraint of trade include those set forth in New Mexico Statutes Armotated,
Section 57-1-1 (1978 Edition as amended, and following). The undersigned
declares that this section has been read and is fully understood.
5. In accordance with the contract, plans and specifications, repair, maintain
and guarantee all work performed thereunder until accepted by the Secretary of
Highways and Transportation.
<PAGE>
SEE NOTICE TO CONTRACTORS (MARCH 14, 1990) ON LOBBYING ACTIVITIES
6. To indemnify and save harmless the State Highway and Transportation
Department from any damage or loss for which the Department may become liable by
the default of said Contractor, or by reason of any neglect or carelessness on
the part of said Contractor, his agents or employees, or by on account of any
act of omission of said Contractor, his servants, agents or employees, in the
performance of this contract.
7. The established DB goal for this project is 13%.
In accordance with 49 CFR Part 23, the Department's Disadvantaged Business
Assistance Program, the applicable Special Provisions, modification to the
Special Provisions, the undersigned (Check a., b., c. as appropriate):
(X) a. Assures to meet or exceed the established DB goal.
( ) b. Cannot meet the established DB goal and assures to meet or exceed a DB
goal of _____________%. All documentation indicating the good faith efforts to
meet the established DB goal will be submitted within five (5) working days
following the bid opening.
( ) c. Is a Department certified Disadvantaged Business.
8. The undersigned, as the apparent low bidder, further assures that he will
submit Form A-585, DBA-1 (for federally funded projects) within five (5) working
days following the bid opening to the Department's Disadvantage Business
Assistance Section. Failure to submit this form within the specified time shall
render the bid non-responsive. If 8.c is checked above, the contractors is not
required to submit Form A-585, DBA-1.
9. The bidder, hereby certifies that he has (X) has not ( ), participated in a
previous contract or subcontract subject to the equal opportunity clause as
required by Executive Orders 11246, 10925 and 11114 as amended, and that he has
(X), has not ( ), filed with the Office of Federal Contract Compliance Program
all reports due under the applicable filing requirements.
10. We acknowledge the receipt of the following Addenda:
NO. DATE NO. DATE
________________________________________________________________________________
________________________________________________________________________________
11. The undersigned agrees that any and all claims that the undersigned may
have for overcharges resulting from antitrust violations as to goods, services
and materials purchased in connection with this bid are hereby assigned to the
State of New Mexico, but only to the extent that such overcharges are passed
on the State. The undersigned further agrees to require its Subcontractors to
assign any and all such claim for overcharges to the State, but only to the
extent such overcharges are passed on to the State, by executing an assignment
on a form obtainable from the Engineer prior to the commencement of work by a
Subcontractor. The undersigned retains all rights to any such antitrust claims
to the extent of any overcharges not passed on to the State.
12. The undersigned tenders herewith, as a proposal guarantee for which receipt
has been given, a certified check, bid, bond, cashier's check, postal money
order or bank money order in the amount of at least 5% of the amount bid drawn
to the order of the New Mexico State Transportation Department.
MEADOW VALLEY CONTRACTORS, INC.
- --------------------------------------
Organization
By: Robert W. Bottcher
-----------------------------------
Title: AREA MANAGER
--------------------------------
SUBSCRIBED AND SWORN TO ME ON THIS:
8 DAY OF MAY, 1998
My Commission Expires: June 17, 2001
[SEAL]
<PAGE>
NEW MEXICO STATE HIGHWAY AND DATE: 04/07/98
TRANSPORTATION DEPARTMENT TIME: 14:37
PAGE: 10
<TABLE>
<CAPTION>
PROJECT(S) : TPA- (TPO)-0048(10)
- --------------------------------------------------------------------------------
LINE ITEM APPROX. UNIT PRICE BID AMOUNT
------------ -------------
NO DESCRIPTION QUANTITY
AND UNITS DOLLARS CTS DOLLARS CTS
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
721000 REMOVAL OF
0900 PAVEMENT STRIPE 13,630.000
L.F. 0.85 11585.50
- --------------------------------------------------------------------------------
801000 CONSTRUCTION
0910 STAKING BY THE CONTRACTOR LUMP 85,000.65
- --------------------------------------------------------------------------------
SECTION 0001 TOTAL 7,568,420.00
- --------------------------------------------------------------------------------
TOTAL BID 7,568,420.00
- --------------------------------------------------------------------------------
</TABLE>
<PAGE>
EXHIBIT 10.87
FORM NO. A-555 CONTRACT NO. E03445
REV. 9-87
New Mexico State Highway and Transportation Department
CONTRACT
THIS CONTRACT, made this 7th day of July 1998, 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, AZ
------------------------------------------------------------------------------
his or its successors and assign, hereinafter call the Contractor.
Inconsideration 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 require in the construction
of Project No. TPA-NH-070-4(31)260 Control No. 2091 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 in corporated herein by reference.
The performance and payment bond given by the contractor in the sum of
$7,634,841.00 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.
CONTRACTOR NEW MEXICO STATE HIGHWAY &
TRANSPORTATION DEPT.
BY /s/ Bradley E. Larson
----------------------------- _________________________________
TITLE President BY /s/ [SIGNATURE
-------------------------- ---------------------------------
Secretary of State Highway &
Transportation Dept.
CORPORATE ACKNOWLEDGMENT
STATE OF NEW MEXICO )
COUNTY OF ______________ )ss.
The foregoing instrument was acknowledged before me this ______________ day
of _________________________, 19____ by_________________________________________
(Name of Officer)
______________________________ of Meadow Valley Contractors, Inc.
----------------------------------------------
(Title of Officer) (Name of Corporation)
an Phoenix AZ
------------------------------------------------------------------------------
(State whether individual, partnership, corporation or joint venture, if
incorporated, give State of incorporation)
corporation, on behalf of said corporation.
My Commission expires:
_______________________________
Notary Public
___________________________
<PAGE>
Form A-585 Page 5 of 5
DB A-1
Rev. 4/88 NEW MEXICO
STATE HIGHWAY AND TRANSPORTATION DEPARTMENT
CONTRACT GOAL FOR DISADVANTAGED BUSINESS
IN HIGHWAY CONSTRUCTION
For the purpose of this contract, a goal of 15.5 percent has been established
for Disadvantaged Business (DB's) Participation.
Type or print legibly
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Item No.(s) of Name of Proposed Subcontract
Work Description Subcontractor/Supplier Amount
- --------------------------------------------------------------------------------
<S> <C> <C>
704320 * San Bar Construction Corp. 1,200.00
- --------------------------------------------------------------------------------
704330 * San Bar Construction Corp. 8,100.00
- --------------------------------------------------------------------------------
704400 * San Bar Construction Corp. 2,400.00
- --------------------------------------------------------------------------------
632000 * Baca's Trees, Inc. 6,964.00
- --------------------------------------------------------------------------------
632100 * Baca's Trees, Inc. 62,952.00
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
1. Project No. TPA-NH-070-4(31)260 CN 2091
-------------------------------------------------
2. Contractor's DB Liaison Officer Norm Watkins
-----------------------------
3. Total Amount Bid $ 7,634,841.00
------------------------------------------
4. Contractors DB Participation
Dollar Estimate and Participation: $ 1,193,723.82 or 15.63% of line 3.
*Must equal or exceed established goal indicated above or bid may be rendered
non-responsive.
________________________________________________________________________________
I will abide by the Disadvantage Business (DB) goal set forth for this project
and hereby submit the names of the DB firms that will participate in the
project. Substitution(s) will not be allowed without prior submission of written
justification to the Project Manager for approval. I understand that failure
to meet the goal may result in Liquidated Damages for the difference between the
DB goal and the actual DB participation achieved.
This statement is my assurance that Meadow Valley Contractors, Inc. agrees to
comply with the requirements of 49 CFR Part 23, and the New Mexico State Highway
and Transportation Department's Disadvantaged Business Assistance Program, and
all the requirements contained therein.
May 19, 1998 /s/ Bradley E. Larson
- ----------------------------- -------------------------------------
Date Signature of Company Official
<PAGE>
EXHIBIT 10.88
THIS JOINT VENTURE AGREEMENT, made and entered into this 16th day of July,
1998, by and between R. E. Monks Construction Co., LLC, a Colorado Company,
(hereinafter referred to as "R. E. Monks"), and Meadow Valley Contractors, Inc.,
a Nevada corporation, (hereinafter referred to as "MVCI")
W I T N E S S E T H
WHEREAS, the Arizona Department of Transportation, hereinafter called the owner,
advertised for bids for construction of Project No. ACSTP-053-1(31)P, Tracs No.
087 MA 218 H230602C, Mesa-Payson Highway(SR 87), Sunflower-MP 226, Segment F in
the counties of Maricopa and Gila (hereinafter referred to as the Construction
Contract), which bids were received on July 2, 1998.
WHEREAS, the parties hereto desire to form a joint venture to enter into and
thereafter to perform a contract with the Arizona Department of Transportation,
for the performance of said work; and
WHEREAS, the parties desire to enter into this joint venture agreement in
order to fix between themselves their respective responsibilities, interest and
liabilities in connection with such bid and the performance of such Construction
Contract.
NOW, THEREFORE, the parties hereto hereby agree to constitute themselves as
joint venturers for the purpose of entering into, performing and completing the
Construction Contract subject to the following terms and conditions:
1. The Construction Contract, if awarded to the parties hereto, shall be
entered into and performed, insofar as the Owner is concerned, by and in the
names of the parties hereto as joint venturers. The Joint Venture shall be
known and designated as MEADOW VALLEY CONTRACTORS, INC./R.E. MONKS
CONSTRUCTION COMPANY, L. L. C., A JOINT VENTURE.
2. As between the parties hereto, the Construction Contract shall be
performed and the rights and obligations of the parties with respect thereto
shall be determined in the following manner:
R. E. Monks - See attachment "A"
MVCI - See attachment "A"
1
<PAGE>
CLARIFICATION OF DUTIES:
The joint venturers will provide the following items to or for the Joint Venture
at no cost to the other partner and will handle all jobsite and management
correspondence with the Arizona Department of Transportation. Project management
personnel will be mutually agreed upon by both parties at the following
positions: Project Manager, Project Engineer, and Clerk/Receptionist.
Items to be furnished by MVCI:
a. Project Manager
b. Clerk/Receptionist
c. Management and control of Traffic Control operations
d. Two office trailers for MVCI use
e. Concrete lining of SPP and CMP as called for on the plans.
f. Project survey budget and subcontractor have been agreed to between the
joint venture parties. The budgeted cost is $575,000.00 and the
subcontractor is Rosendahl and Associates. rosendahl's quote is for
$502,000.00. Any cost savings or cost overrun between original budget
($575,000.00) and final cost to complete the surveying will be split
50/50.
g. Painting of Rock Sculptured Shotcrete.
Items to be furnished by R. E. Monks:
a. All water to be used on the project.
b. An approximate five(5) acre yard site in Sunflower for use as crusher
site, hot plant site, concrete batch plant site, QC trailer site,
engineer's office trailer site, R. E. Monks and MVCI trailer site, and
materials storage site.
c. A double wide trailer for R. E. Monks use.
d. Shot rock, for AC MA, 24" minus delivered to a crusher site in
Sunflower, material permitting.
e. Access to all structures suitable for appropriate cranes and structure
equipment. R. E. Monks has included $260,000.00 in their bid for this
work. Monks will perform this work at mutually agreeable hourly rates.
Equipment haul roads through Sycamore Creek, Upper Kitty Joe Creek, and
Lower Kitty Joe Creek are excluded from these costs since R. E. Monks
will need access through these areas regardless. Any gain or loss will
be split equally between the joint venture partners.
f. A fully operated and maintained generator with capacity to furnish
adequate power to MVCI offices, the Engineer's office, the QC trailer,
and R. E. Monks office on a 24 hour basis.
2
<PAGE>
g. Semi belly dump trucks fully operated and maintained at $52.00 per
hour.
h. MA hauls from Tonto Basin delivered to the hot plant site for the unit
price of $3.00 per ton.
i. Project Engineer/Coordinator. Although R.E. Monks is furnishing the
Project Engineer/Coordinator, MVCI will reimburse R.E. Monks
$8,500.00/ month for each month that that position is filled by an
employee of R.E. Monks. If partial months are used the amount will be
prorated. The monthly reimbursement rate includes all costs associated
with that position including but not limited to a pickup, computer,
fringe benefits, payroll taxes, insurance, etc. It is anticipated that
that position will be filled by a R.E. Monks employee for
approximately 18-20 months.
Items to be shared by both MVCI and R.E. Monks:
a. Fencing around the Joint Venture yard site in Sunflower.
b. Security, if needed and agreed to by the both Parties, at the job
site.
The reference to items is to the bid items specified in the Construction
Contract. The foregoing division of the work under the Construction Contract
between the parties hereto is intended to result in the performance of the
Mesa-Payson Highway (SR 87) Sunflower-MP 226, Segment F, complete. Any work
provided for in change or extra work orders shall be performed in accordance
with the foregoing division of work between the parties hereto, but if any work
so ordered does not fall within the present bid items of the Construction
Contract, it shall be performed in such manner as the parties may mutually
agree. Each party hereto shall separately and individually enter into such
subcontract, purchase orders, equipment rental agreements and shall employ
sufficient workmen to enable it to perform the items of work as hereinabove
divided between them in a diligent and satisfactory manner.
The parties agree to split, in proportion to their respective shares of the
work completed, all miscellaneous fees/charges necessary to establish the Joint
Venture accounts.
3. The Parties agree that payment from the owner for work performed
hereunder shall be made directly to the Joint Venture. The Joint Venture
shall establish an account at a mutually acceptable financial institution,
and management of said account shall be at the direction of the Management
Committee established in paragraph 10 herein. Within three (3) days of the
date that the funds are collected from the Owner by the Joint Venture, each
Party shall be paid for the sums due them based on their portions
3
<PAGE>
of the Work completed as indicated in the progress estimates accompanying such
payment less the appropriate amount of sales tax which will be paid from the
Joint Venture account. Any retained funds by the owner shall be shared by the
Parties in proportion to their respective shares of the work completed.
4. R. E. Monks and MVCI shall, and hereby do, assume all obligations of the
Joint Venture under the Construction Contract with respect to the bid items
assigned to them, respectively, as above provided, and each of them shall hold
the other and the Joint Venture free and harmless from any and all liability or
responsibility with respect to the bid items as so divided. With respect to
Minority and Woman-Owned Business Enterprise requirements, Equal Employment
Opportunity Affirmative Action Programs, On the Job Training Programs, Safety
Programs and the like, each joint venturer shall be responsible for its
respective part or proportionate share and shall undertake to satisfy all such
requirements pertinent to the items of work assigned to it, at its own expense.
In the event one partner has difficulty meeting its obligation hereunder, the
Joint Venture partner shall cooperate in the best way possible to achieve the
contract goals.
5. With respect to any bond or bonds required of the Joint Venture by Owner
in connection with the Construction Contract, R. E. Monks and MVCI shall apply
for and obtain such bonds and shall arrange for interests in the performance of
the Construction Contract as the bid items thereof are hereinabove divided and
the premiums for such bond or bonds shall be paid for by each Joint Venture
partner respectively as outlined in attachment 'A'.
6. Each Joint Venture partner shall procure and maintain its own Workmen's
Compensation, Automobile Liability, including owned, non owned, and hired
automobiles, and Mobile Equipment Liability Policies.
7. The Joint Venture shall obtain, carry and maintain:
a. A Comprehensive General Liability Insurance Policy with single limit
coverage for each occurrence of:
$1,000,000 including coverage for:
i. Completed Operations and Products Liability
ii. Broad Form Property Damage Liability, and
4
<PAGE>
iii. Liability which such party may incur as a result of the
operations, acts or omissions of its subcontractors,
suppliers or materialsmen, and their agents or
employees,
b. Each party shall pay its proportionate share of the premium due
for the above policy in the performance of the Construction
Contract. The proportionate share is defined as the percentage of
the total contract revenue that each party completes as defined in
attachment 'A'. It is anticipated that the cost of said premium
will be 0.127% of the contract revenue plus a lump sum fee of
$9,828.00.
c. The joint Venture Policy will name the parties as insured on the
umbrella liability policy. The policy shall be written on an
occurrence-type basis.
8. Each party shall furnish to the other party certificates from
approved insurance companies evidencing that all the foregoing insurance is
in force and will not be canceled, reduced or modified without thirty (30)
days prior written notice to the other party. Such policies shall be
endorsed to designate the other party hereto and this Joint Venture as
additional insured.
9. Should any penalty be assessed because of delay in the completion
of the work under said Construction Contract, such penalty shall be charged
against the party assigned the particular item or items of the work which
caused the delay in completion of the entire contract; and if both parties
hereto should contribute to the delay, the penalty shall be charged or
prorated to each of the respective parties in proportion to the respective
items of work involved in the delay. Should penalties be assessed due to
poor planning or decision making on the part of the mutually selected
management personnel as described herein, such penalties will be charged
equally between the parties.
Should any value engineering proposals be submitted, negotiated, and
monetary gains realized by the Joint Venture for any work, the savings
shall be divided between the partners in the following manner: The partner
responsible for the changed bid item will receive 80% of the savings
realized from those items. The other partner will receive 20% of the
savings. In the event a value engineering proposal affects items assigned
to both parties, the total V.E. savings will first be split on a prorated
basis equal to the values of the venturers respective items. Each of the
split amounts will then be divided 80/20 with the responsible partner
receiving
5
<PAGE>
80% of their split amount and 20% of the other partners split amount.
10. Should any dispute arise between the parties hereto as to the
payment or division of any penalty or savings, such dispute shall first be
attempted to be resolved by the Management Committee established in
paragraph 13 herein. If the Management Committee cannot resolve the
dispute, then the dispute shall be resolved as follows:
Each of the parties hereto shall choose an arbitrator, and the two
arbitrators so chosen shall select a third arbitrator. Each arbitrator
shall be a person skilled and having knowledge and experience in
construction work similar to this project. The Board of Arbitrators so
chosen shall have full power to hear and determine all matters so in
dispute, and their decision an award when signed by two or more of them
shall be final and conclusive as to all matters submitted to them and shall
be binding upon both parties hereto.
The expenses of any such arbitration shall be paid as follows:
Each party shall pay the arbitrator chosen by such party, and the
charges of the third arbitrator shall be paid equally by the parties
hereto.
11. Each party shall indemnify, defend and save harmless each other
party, its members, directors, officers, and employees, from and against
any and all claims, damages (including direct, liquidated, consequential,
incidental or other damages), losses, liabilities, attorneys fees, costs
and expenses whatsoever kind or nature at any time arising out of any
failure of such party to perform any of its obligations with respect to the
items of work by it to be performed or arising under this Joint Venture
Agreement or which are in any manner directly or indirectly caused or
occasioned by, or contributed to, any act, omission, fault or negligence,
whether active or passive, in whole or in part, of anyone acting under its
direction or control, or on its behalf in connection with or incidental to
such work, even though the same may have resulted from the joint,
concurring or contributory act, omission, fault or negligence, whether
active or passive, or the other party, Owner or any other person, unless
the same is caused by the sole negligence or willful misconduct of the
other party, its agents, servants or independent contractors who are
directly responsible to it.
6
<PAGE>
12. R. E. Monks and MVCI each shall furnish all working capital, when and
as required, for the prosecution of the bid items to be performed by them, and
by reason thereof it is not contemplated that the Joint Venture will itself
require any working capital. Each party shall be entitled to the profit and
shall bear the loss, if any, with respect to each bid item of work assigned to
it. Each of the parties shall maintain adequate books of account with respect to
its operations. The Joint Venture shall request securities in lieu of retention
and each party shall fund his proportionate share. Earnings from the securities
account will be distributed to each party in proportion to its respective
funding amount at the time of earnings distribution.
13. MVCI shall be the sponsor of this Joint Venture and the Managing Party
with respect to all work to be performed under the Construction Contract. MVCI
is authorized to execute, on behalf of the Joint Venture, all contracts and any
related documents. R. E. Monks and MVCI shall be responsible for the overall
prosecution, scheduling and coordination of the work to be performed under the
Construction Contract, but shall not be entitled to a fee therefore. The Project
Manager, and Clerk/Receptionist shall be employed by MVCI but will be mutually
agreed upon by both parties. The Project Engineer/Coordinator shall be employed
by R. E. Monks but will be mutually agreed upon by both parties. These employees
shall act on behalf of and in the best interest of the Joint Venture without
regard to their employment by either party.
To facilitate handling of matters and questions in connection with the
performance of the Contract and the Work, a Management Committee of three
persons will be created consisting of one appointee from each Party and the
Project Manager. Each of the Parties shall advise the other in writing as to the
name of the person appointed by it as its representative in the Management
Committee. Each Party may, at any time and from time to time, change its
representative by filing with the other written notice of such change. The said
representatives shall meet from time to time, as necessary to act on all
necessary matters pertaining to the work of the Joint Venture. The Parties shall
endeavor to reach unanimous decisions on all matters. In the event that
unanimity is not reached, either party may request arbitration as previously
described in paragraph 10.
If at any time one of the venturers has reasonable cause to suspect that
any employee, of either party or subcontractor or
7
<PAGE>
supplier, is acting in a manner that is unsafe or otherwise injurious to the
welfare of the Joint Venture (including the parties thereto and their
employees), as managing partner, MVCI will be responsible to act in a
responsible and timely fashion to counsel, remove, or otherwise correct the
situation. This responsibility to correct these situations does not however
change MVCI liabilities from those described herein in any way.
14. This Joint Venture Agreement extends only to the performance of the
Construction Contract, including any extra work orders, and/or change orders in
connection therewith, or any contract supplemental thereto. In no event shall
this agreement extend to or cover any other or different work, and upon the
completion of performance of the Construction Contract and the distribution by
the Joint Venture to the Joint Venturers of the payments from Owner as herein
provided, the Joint Venture shall terminate.
15. If any party hereto (if any individual) shall die or become
incompetent, or if any party (not an individual) shall dissolve, or if any party
hereto shall become bankrupt, or file a voluntary petition in bankruptcy, this
Joint Venture shall not terminate, but the right of the disabled party to
continue to participate in the Joint Venture shall, except as hereafter
provided, terminate, and the remaining parties shall do all things necessary to
complete performance of the Construction Contract and then to wind up all of the
Joint Venture affairs, including the collection of all monies and property due
this Joint Venture and the distribution of its assets. Such disabled party, or
its legal representative, shall have no further voice in the performance of the
Construction Contract or in the management of this Joint Venture. The disabled
party, or its representative, shall have no further voice in the performance of
the Construction Contract or in the management of this Joint Venture. The
disabled party, shall be entitled to that share of the profits of this Joint
Venture earned with respect to the items of work assigned to the disabled party
respect to the items of work assigned to the disabled party measured by the
ratio of dollar value of the items of work performed by such party in relation
to the total dollar value of all of such items, but such disabled party and its
representatives shall be charged with and shall be liable for its full share of
any and all losses that may be suffered by this Joint Venture with respect to
the entirety of all items of work assigned to the disabled party.
16. Any assignment of this agreement, in whole or in part, or any transfer
of any rights hereunder, or any delegation of any duties to be performed
hereunder, made by either party hereto,
8
<PAGE>
whether by operation of law or otherwise, without the prior written consent
of the other party hereto shall be void.
17. Subject to the foregoing provisions, this agreement shall insure
to the benefit of and be binding upon the parties hereto, their heirs,
successors, assigns and legal representatives.
18. As used herein, the neuter gender includes the masculine or
feminine gender and the plural includes the singular, as the context may
require. All parties agree to comply with all federal, state and local
laws, codes, ordinances and regulations in performing work under this
agreement, including, but not limited to, the Occupation Safety and Health
Act of 1970, Mine Safety and Health Act, Environmental Protection Agency
laws and regulations, the Immigration Reform and Control act of 1986, the
Americans with Disabilities Act, and the Contract Work Hours and Safety
Standards Act.
This agreement shall be interpreted in accordance with the laws of the
State of Arizona. Venue shall be Maricopa County, Arizona unless otherwise
specifically agreed between parties. If in the event any provision of this
agreement is found to be unenforceable, the remaining provisions shall
survive to the fullest possible extent. This document constitutes the
entire agreement between the parties and any additions, deletions, or
modifications must be in writing and signed by both parties in order to be
effective.
IN WITNESS WHEREOF, the parties hereto have executed this Joint Venture
agreement on the date first hereinabove written.
ATTEST R. E. Monks Construction, LLC
/s/ [SIGNATURE /s/ Richard D. Monks
- -------------------------- ------------------------------
(seal) Richard D. Monks
Vice President
ATTEST Meadow Valley Contractors, Inc.
/s/ Robert W. Bottcher /s/ Bradley E. Larson
- -------------------------- ------------------------------
(seal) Bradley E. Larson
President
9
<PAGE>
MEADOW VALLEY CONTRACTORS, INC./R.E. MONKS, A JV MVCI PROJECT NO. 9811
ADOT PROJECT NO. ACSTP-053-1 (31) P PAY ESTIMATE NO.:
MESA-PAYSON HWY (SR 87) PERIOD ENDING DATE:
(SUNFLOWER-MP 226, SEGMENT F)
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------
ITEM UNIT UNIT TOTAL
NO DESCRIPTION UN QUANT PRICE BID PRICE
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
MV 2010001 CLEARING AND GRUBBING LSUM 1 500,000.00 500,000.00
MV 2020072 REMOVE AND SALVAGE GUARD RAIL LF 3750 1.50 5,625.00
MV 2020076 REMOVE & SALVAGE BRKWY CABLE TERMINAL EACH 13 175.00 2,275.00
MV 2020101 REMOVE FENCE LF 4850 1.00 4,850.00
MV 2060001 FURNISH WATER SUPPLY LSUM 1 150,000.00 150,000.00
MV 4040111 BITUMINOUS TACK COAT TON 155 140.00 21,700.00
MV 4040116 APPLY BITUMINOUS TACK COAT HOUR 320 115.00 36,800.00
MV 4040125 FOG COAT TON 65 165.00 10,725.00
MV 4040163 BLOTTER MATERIAL TON 191 17.00 3,247.00
MV 4040230 ASPHALT BINDER (PG76-16) (FOR 1in SHRP MIX) TON 4955 195.00 966,225.00
MV 4090003 ASPHTC CONC (MISCELLANEOUS STRUCTURAL) TON 9000 40.00 360,000.00
MV 4140040 AR-ACFC TON 5300 22.00 116,600.00
MV 4140042 ASPHALT RUBBER MATERIAL (FOR AR-ACFC) TON 504 250.00 126,000.00
MV 4140044 MINERAL ADMIXTURE (FOR AR-ACFC) TON 48 90.00 4,320.00
MV 4160002 ASPHALTIC CONC (1in SHRP MIX) (END PRODUCT) TON 99090 16.00 1,585,440.00
MV 4160031 MINERAL ADMIXTURE TON 933 90.00 83,970.00
MV 5010107 PIPE, CORRUGATED METAL, SLOTTED, 18in LF 580 65.00 37,700.00
MV 5030039 CONC CATCH BSN (C-15.20) ONE 17 'WING,H*=8' EACH 1 3,300.00 3,300.00
MV 5030070 CONC CATCH BASIN (C-15.30) SINGLE, H*=8' EACH 35 1,300.00 45,500.00
MV 5030099 CONC CATCH BSN (C-15.40) SINGLE, H*=8' EACH 1 3,500.00 3,500.00
MV 5030142 CONC CTCH BSN (SAFETY INLET) (C15.90 MOD) EACH 3 2,300.00 6,900.00
MV 5030143 CONC CTCH BSN (MEDIAN) (C-15.81) (MODIFIE EACH 1 1,700.00 1,700.00
MV 6016088 HEADWALL (24in) (SINGLE) (B-11.11) EACH 11 1,400.00 15,400.00
MV 6016089 HEADWALL (48in) (SINGLE) (B-11.12) EACH 5 2,500.00 12,500.00
MV 6016090 HEADWALL (48in) (DOUBLE) (B-11.14) EACH 1 4,500.00 4,500.00
MV 6016091 HEADWALL (72in) (SINGLE) (B-11.12) EACH 4 5,500.00 22,000.00
MV 6016092 HEADWALL (72in) (SINGLE) (B-11.12) (DROPINLET EACH 1 8,300.00 8,300.00
MV 6016093 HEADWALL (90in) (SINGLE) (B-12.10 OR B-12.50 EACH 2 8,000.00 16,000.00
MV 6016094 HEADWALL (120in) (SGL) (B-12.10 OR B-12.50) EACH 2 15,000.00 30,000.00
MV 6016095 HEADWALL (144in) (SGL) (B-12.10 OR B-12.50) EACH 2 29,000.00 58,000.00
MV 6070002 BREAKAWAY SIGN POST S4x7.7 LF 48 17.00 816.00
MV 6070022 FOUNDATION FOR BRKWY SIGN POST S4x7.7 EACH 4 300.00 1,200.00
MV 6070040 SLIP BASE SIGN POST (P-2) EACH 55 300.00 16,500.00
MV 6070041 SIGN POST (P-1) (PERFORATED) (SINGLE) LF 1000 12.00 12,000.00
MV 6070042 SIGN POST (P-2) (PERFORATED) (TELESCOPING) LF 800 18.00 14,400.00
MV 6070046 FOUNDTN FOR SIGN POST (P-1) (PERFORATED) EACH 81 165.00 13,365.00
MV 6070047 FOUNDTN FOR SIGN POST (P-2) (PERFORATED) EACH 60 165.00 9,900.00
MV 6080011 WARNING SIGN PANELS SQFT 600 13.00 7,800.00
MV 6080016 EXTRD ALU W/STD REFLECT SHTG&DEMNT CHRAT SQFT 202 33.00 6,666.00
MV 6080021 NARKER SIGN PANELS SQFT 50 13.00 650.00
MV 6080031 REGULATORY SIGN PANELS SQFT 550 13.00 7,150.00
MV 6080032 FLT SHT ALUM PNL W/DEMNT CHAR & TYP 2 SH SQFT 294 27.00 7,938.00
MV 6080081 FLT SHT ALU W/DIR APL OR SILK-SCRN CHRAT SQFT 65 24.00 1,560.00
MV 6080101 MISC WORK (SIGNS) (REMOVE & SALVAGE) LSUM 1 10,000.00 10,000.00
MV 7010251 OBLITERATE PAVEMENT MARKING LF 3500 0.40 1,400.00
MV 7015010 TEMPORARY CONC BARR (INSTLN & REMOVAL) LF 2200 6.00 13,200.00
MV 7015020 TEMP IMP ATTENUATORS (INSTLN & REMOVAL) EACH 5 475.00 2,375.00
MV 7015042 TEMPORARY PAINTED MARKING (STRIPE) LF 17400 0.10 1,740.00
MV 7015052 OBLITERATE PAVEMENT MARKING (STRIPE) LF 9775 0.40 3,910.00
MV 7015090 SPECIALTY SIGNS (W/TYPE II SHEETING) SQFT 800 10.00 8,000.00
MV 7016020 TEMPORARY CONCRETE BARRIER (IN USE) LFDY 70500 0.07 4,935.00
MV 7016030 BARR (TYPE II, VERT. PANEL, TUBULAR MARKER) DAY 15258 0.30 4,577.00
MV 7016031 BARR (TYPE III, HIGH LEVEL FLAG TREES) DAY 585 1.00 585.00
</TABLE>
* LESS THAN
Page 1
<PAGE>
MEADOW VALLEY CONTRACTORS, INC./R.E. MONKS, A JV MVCI PROJECT NO. 9811
ADOT PROJECT NO. ACSTP-053-1(31)P PAY ESTIMATE NO.:
MESA-PAYSON HWY(SR 87) PERIOD ENDING DATE:
(SUNFLOWER-MP 226, SEGMENT F)
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------
ITEM UNIT UNIT TOTAL
NO DESCRIPTION UN QUANT PRICE BID PRICE
------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
MV 7016032 PORTABLE SIGN STANDS (RIGID) DAY 1185 0.40 474.00
MV 7016033 PORTABLE SIGN STANDS (SPRING TYPE DAY 3852 1.00 3,852.00
MV 7016035 WARNING LIGHTS (TYPE A) DAY 16750 0.20 3,350.00
MV 7016037 WARNING LIGHTS (TYPE C) DAY 16675 0.40 6,670.00
MV 7016038 TRAFFIC CONE (28 INCHES) DAY 2404 0.25 601.00
MV 7016039 EMBEDDED SIGN POST DAY 16984 0.10 1,698.40
MV 7016040 TEMPORARY SIGN (HIGH INTENS. * 10 SF) DAY 143 0.50 71.50
MV 7016041 TEMPORARY SIGN (HIGH INTENS. ** 10 SF) DAY 7400 0.60 4,440.00
MV 7016042 TEMPORARY SIGN (STANDARD INTENS. * 10 SF) DAY 1459 0.40 583.60
MV 7016043 TEMPORARY SIGN (STANDARD INTENS. ** 10 SF) DAY 1606 0.50 803.00
MV 7016050 TRUCK MOUNTED ATTENDATOR DAY 5 300.00 1,500.00
MV 7016061 FLASHING ARROW PANEL DAY 374 38.00 14,212.00
MV 7016066 CHANGEABLE MESSAGE SIGN DAY 133 75.00 9,975.00
MV 7016075 FLAGGING SERVICES HOUR 638 25.00 15,950.00
MV 7030008 DELINEATOR (FLEXIBLE) EACH 270 21.00 5,670.00
MV 7030036 MILEPOST MARKER (4-S-4.19.1) EACH 12 100.00 1,200.00
MV 7042051 REMVL OF CURING COMPND FROM PCCP STRIP' LF 20000 0.10 2,000.00
MV 7050022 PVMNT MARKING, PREFMD, TYPE I, WHITE STRIPE LF 600 1.74 1,044.00
MV 7050023 PVMNT MARKING, PREFMD, TYPE I, SINGLE ARROW EACH 12 150.00 1,800.00
MV 7050026 PVMNT MARKING, PREFMD, TYPE I, LEGEND (ONLY) EACH 6 160.00 960.00
MV 7060100 PAVEMENT MARKER, RECESSED, TYPE C EACH 130 9.00 1,170.00
MV 7060111 PAVEMENT MARKER, RECESSED, TYPE G EACH 850 9.00 7,650.00
MV 7080001 PERMANENT PVMNT MARKING (PAINTED) (WHITE) LF 107000 0.06 6,420.00
MV 7080011 PERMANENT PVMNT MARKING (PAINTED) (YELLOW) LF 95000 0.06 5,700.00
MV 7090001 DUAL COMPONENT PVMT MRKGS (WHITE EPOXY) LF 107000 0.25 26,750,00
MV 7090002 DUAL COMPONENT PVMT MRKGS (YELLOW EPOXY) LF 95000 0.25 23,750.00
MV 8061002 TREE (FIVE GALLON) EACH 340 90.00 30,600.00
MV 8070001 LANDSCAPING ESTABLISHMENT LSUM 1 45,000.00 45,000.00
MV 8080006 WATER DISTRIBUTION SYSTEM LSUM 1 90,000.00 90,000.00
MV 9010001 MOBILIZATION LSUM 1 3,367,000.00 3,367,000.00
MV 9021001 TEMPORARY FENCE LF 600 15.00 9,000.00
MV 9022001 MEDIAN GLARE SCREEN LF 27792 7.00 194,544.00
MV 9030013 BARBED WIRE GAME FENCE LF 85300 3.00 255,900.00
MV 9030100 FENCE GATE, TYPE 1, SINGLE EACH 9 700.00 6,300.00
MV 9030102 FENCE GATE, TYPE 1, DOUBLE EACH 2 1,100.00 2,200.00
MV 9030105 FENCE GATE, TYPE 2 LF 100 40.00 4,000.00
MV 9030113 FLOOD GATE (FOR ITEM 9030013) LF 160 13.00 2,080.00
MV 9050001 GUARD RAIL, W-BEAM, SINGLE FACE LF 27688 12.00 332,256.00
MV 9050016 GRD RAIL EXTRDER TERM (ET-2000-LET OR BST EACH 30 2,500.00 75,000.00
MV 9050202 GUARD RAIL (NESTED STEEL W BEAM) LF 150 30.00 4,500.00
MV 9050206 GUARD RAIL ANCHORAGE, BOLTED EACH 6 350.00 2,100.00
MV 9050301 GUARD RAIL RUB RAIL EACH 12 450.00 5,400.00
MV 9050400 GRDRL TRANS, W-BEAM TO CNC BAR, C10.30, .31 EACH 12 1,600.00 19,200.00
MV 9050401 GRDRL TRANS, W-BEAM TO CONC BARR, C10.32 EACH 5 1,300.00 6,500.00
MV 9060021 CATTLE GUARD (2 UNIT) EACH 2 4,000.00 8,000.00
MV 9060031 CATTLE GUARD (3 UNIT) EACH 1 6,000.00 6,000.00
MV 9060041 CATTLE GUARD (4 UNIT) EACH 1 8,000.00 8,000.00
MV 9060051 CATTLE GUARD (5 UNIT) EACH 2 10,000.00 20,000.00
MV 9060301 RECONSTRUCT CATTLE GUARD EACH 1 2,500.00 2,500.00
MV 9090001 SURVEY MONUMENT (C-21.10) EACH 2 200.00 400.00
MV 9100079 CONCRETE BARRIER (MEDIAN,B21.18, TYP C, DEP LF 60 120.00 7,200.00
MV 9100201 CONCRETE MEDIAN BARRIER LF 24643 24.00 591,432.00
MV 9110001 RIGHT-OF-WAY MARKER EACH 109 175.00 19,075.00
</TABLE>
* LESS THAN
** MORE THAN
Page 2
<PAGE>
MEADOW VALLEY CONTRACTORS, INC./R.E. MONKS, A JV MVCI PROJECT NO. 9811
ADOT PROJECT NO. ACSTP-053-1(31)P PAY ESTIMATE NO.:
MESA-PAYSON HWY (SR 87) PERIOD ENDING DATE:
(SUNFLOWER-MP 226, SEGMENT F)
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------
ITEM UNIT UNIT TOTAL
NO DESCRIPTION UN QUANT PRICE BID PRICE
---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
MV 9140121 RETAINING WALL (REINF CONC) (B-18.40) SQFT 380 50.00 19,000.00
MV 9160001 EMBANKMENT CURB LF 1206 7.00 8,442.00
MV 9170001 EMBANKMENT SPILLWAY (C-4.10) LF 204 55.00 11,220.00
MV 9170021 INLET (C-4.10) (SINGLE) EACH 6 1,100.00 6,600.00
MV 9170041 OUTLET (C-4.10) EACH 6 650.00 3,900.00
MV 9230001 PROVIDE ON-THE-JOB TRAINING HOUR 1100 0.80 880.00
MV 9240058 MISC WORK (ATTACH BAT HABITATS) LSUM 1 20,000.00 20,000.00
MV 9240088 MISC WORK (PRTBLE CELULAR VRIBLE MSG SGN LSUM 1 80,000.00 80,000.00
MV 9240114 MISC WORK (OPER. ADOT PRVDED RADAR SPEED HOUR 100 35.00 3,500.00
MV 9240130 MISC WORK (PORTABLE LIGHT) DAY 102 125.00 12,750.00
MV 9240170 CONTRACTOR QUALITY CONTROL LSUM 1 750,000.00 750,000.00
MV 9250001 CONSTRUCTION SURVEYING AND LAYOUT LSUM 1 700,000.00 700,000.00
MV 9260004 ENGINEER'S FIELD OFFICE LSUM 1 35,000.00 35,000.00
MV 9280001 FORMED RUMBLE STRIP LF 66000 0.20 13,200.00
MV 9280031 CUT GROOVE RUMBLE STRIP LF 6400 0.50 3,200.00
MV 9990110 STRUCTURAL CONCRETE (CLASS S) (F'C=3,000) CUYD 504 270.00 136,080.00
MV 9990115 STRUCTURAL CONCRETE (CLASS S) (F'C=3,500) CUYD 1030 270.00 278,100.00
MV 9990120 STRUCTURAL CONCRETE (CLASS S) (F'C=4,500) CUYD 2132 220.00 469,040.00
MV 9990125 BRIDGE CONCRETE BARRIER, TYPE A LF 2905 32.00 92,960.00
MV 9990130 BRIDGE CONCRETE BARRIER TRANSITION EACH 8 2,000.00 16,000.00
MV 9990135 DECK JOINT ASSEMBLY (STRIP SEAL JOINT) LF 280 75.00 21,000.00
MV 9990140 APPROACH SLAB (B-19.11) SQFT 2520 11.00 27,720.00
MV 9990145 PRECAST, P/S MEMBER (AASHTO TYPE 6 GIRDER LF 7140 115.00 821,100.00
MV 9990150 VERTICAL RESTRAINER, EARTHQUAKE (FIXED) EACH 64 75.00 4,800.00
MV 9990155 VERT RESTRAINER, EARTHQUAKE (EXPANSION) EACH 64 100.00 6,400.00
MV 9990160 REINFORCING STEEL LB 922320 0.35 322,812.00
MV 9990170 DRLD SHAFT FOUND (60in) SYC CRK BR NB&SB LF 666 540.00 359,640.00
MV 9990175 DRLD SHAFT FOUND (69in) SYC CRK BR NB&SB LF 506 1,100.00 556,600.00
MV 9990210 STRUCTURAL CONC (CLASS S) (F'C-3,000 PSI) CUYD 132 400.00 52,800.00
MV 9990215 STRUCTURAL CONC (CLASS S) (F'C-3,500 PSI) CUYD 1902 220.00 418,440.00
MV 9990220 STRUCTURAL CONC (CLASS S) (F'C-4,500 PSI) CUYD 2470 220.00 543,400.00
MV 9990225 BRIDGE CONCRETE BARRIER, TYPE A LF 1730 32.00 55,360.00
MV 9990230 BRIDGE CONCRETE BARRIER, TYPE B LF 1730 32.00 55,360.00
MV 9990235 BRIDGE CONCRETE BARRIER, TYPE C LF 30 70.00 2,100.00
MV 9990240 BRIDGE CONCRETE BARRIER TRANSITION EACH 4 2,000.00 8,000.00
MV 9990245 DECK JOINT ASSEMBLY (STRIP SEALS) LF 240 75.00 18,000.00
MV 9990250 APPROACH SLSAB (B-19.11) SQFT 2393 11.00 26,323.00
MV 9990255 PRECAST, P/S MBR (AASHTO TYPE 6 GIRDER) LF 8575 115.00 986,125.00
MV 9990260 RESTRAINERS, VERTICAL EARTHQUAKE (FIXED) EACH 80 75.00 6,000.00
MV 9990265 RESTRAINERS, VERT EARTHQUAKE (EXPANSION) EACH 68 100.00 6,800.00
MV 9990270 REINFORCING STEEL LB 1067740 0.35 373,709.00
MV 9990275 DRLD SHFT FOUND (60in) LWR KTY JOE CR NB&SB LF 830 360.00 298,800.00
MV 9990280 DRLD SHFT FOUND (96in) LWR KTY JOE CR NB&SB LF 1114 610.00 679,540.00
MV 9990310 STRUCTURAL CONCRETE (CLASS S) (F'C=3,000) CUYD 415 170.00 70,550.00
MV 9990315 STRUCTURAL CONCRETE (CLASS S) (F'C=3,500) CUYD 1028 310.00 318,680.00
MV 9990320 STRUCTURAL CONCRETE (CLASS S) (F'C=5,000) CUYD 8160 450.00 3,672,000.00
MV 9990325 BRIDGE CONCRETE BARRIER, TYPE A LF 2292 32.00 73,344.00
MV 9990330 BRIDGE CONCRETE BARRIER, TYPE B LF 2248 32.00 71,936.00
MV 9990335 BRIDGE CONCRETE BARRIER TRANSITION EACH 4 2,000.00 8,000.00
MV 9990340 DECK JOINT ASSEMBLY (MODULAR) LF 172 550.00 94,600.00
MV 9990345 APPROACH SLAB (B-19.11) SQFT 2484 11.00 27,324.00
MV 9990350 BEARING (NON-GUIDED EXPANSION) EACH 16 1,500.00 24,000.00
MV 9990355 PRESTRESS CAST-IN-PLACE CONC (LONGITUDINA LSUM 1 500,000.00 500,000.00
</TABLE>
Page 3
<PAGE>
MEADOW VALLEY CONTRACTORS, INC. /R.E. MONKS, A JV MVCI PROJECT NO. 9811
ADOT PROJECT NO. ACSTP-053-1 (31)P PAY ESTIMATE NO.:
MESA-PAYSON HWY (SR 87) PERIOD ENDING DATE:
(SUNFLOWER-MP 226, SEGMENT F)
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------
ITEM UNIT UNIT TOTAL
NO DESCRIPTION UN QUANT PRICE BID PRICE
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
MV 9990360 REINFORCING STEEL LB 2148820 0.35 752,087.00
MV 9990365 DRLD SHFT FOUND (60in) WHSKY SPRGS BR NB & SB LF 400 310.00 124,000.00
MV 9990370 DRLD SHFT FOUND (120in) WHSKY SPRGS BR NB & S LF 622 970.00 603,340.00
MV 9990410 STRUCTURAL CONCRETE (CLASS S) (F'C=3, 500) CUYD 1266 260.00 329,160.00
MV 9990415 STRUCTURAL CONCRETE (CLASS S) (F'C=5, 000) CUYD 4257 470.00 2,000,790.00
MV 9990420 BRIDGE CONCRETE BARRIER, TYPE A LF 1226 32.00 39,232.00
MV 9990425 BRIDGE CONCRETE BARRIER, TYPE B LF 1226 32.00 39,232.00
MV 9990430 DECK JOINT ASSEMBLY (STRIP SEAL JOINT) LF 170 75.00 12,750.00
MV 9990435 APPROACH SLAB (B-19.11) SQFT 2400 11.00 26,400.00
MV 9990440 BEARING (NON-GUIDED EXPANSION) EACH 32 1,200.00 38,400.00
MV 9990445 PRESTRESS CAST-IN-PLACE CONC (STA 2663+) LSUM 1 300,000.00 300,000.00
MV 9990450 REINFORCING STEEL LB 979662 0.40 391,864.80
MV 9990455 CONCRETE BRIDGE BARRIER TRANSITION EACH 4 2,000.00 8,000.00
MV 9990460 DRLD SHFT FOUND (60in) UPR KITTY JOE BR NB&S LF 640 400.00 256,000.00
MV 9990465 DRLD SHFT FOUND (72in) UPR KITTY JOE BR NB&S LF 602 440.00 264,880.00
MV 9990470 DRLD SHFT FND (120in) UPR KITTY JOE BR NB&S LF 590 1,300.00 767,000.00
MV 9990510 STRUCTURAL CONCRETE (CLASS S) (F'C=3,000) CUYD 375 270.00 101,250.00
MV 9990515 STRUCTURAL CONCRETE (CLASS S) (F'C-3,500) CUYD 1100 240.00 264,000.00
MV 9990520 STRUCTURAL CONCRETE (CLASS S) (F'C-4,500) CUYD 1225 240.00 294,000.00
MV 9990525 BRIDGE CONCRETE BARRIER, TYPE A LF 900 32.00 28,800.00
MV 9990530 BRIDGE CONCRETE BARRIER, TYPE B LF 900 32.00 28,800.00
MV 9990535 BRIDGE CONCRETE BARRIER TRANSITION EACH 8 2,000.00 16,000.00
MV 9990540 DECK JNT ASSBLY (B-24.20 3X3 COMPR SEAL) LF 172 90.00 15,480.00
MV 9990545 APPROACH SLAB (B-19.11) SQFT 2400 11.00 26,400.00
MV 9990550 PRECAST, P/S MBR (AASHTO TYPE 4 GIRDER) LF 5295 110.00 582,450.00
MV 9990555 VERTICAL RESTRAINER, EARTHQUAKE (FIXED) EACH 80 75.00 6,000.00
MV 9990560 VERTICAL RESTRAINER, EARTHQUAKE (EXPANS) EACH 40 100.00 4,000.00
MV 9990565 REINFORCING STEEL LB 643460 0.35 225,211.00
MV 9990570 DRLD SHFT FOUND (48in) COTTONWOOD BR NB&SB LF 720 210.00 151,200.00
MV 9990575 DRLD SHFT FOUND (96in) COTTONWOOD BR NB&SB LF 520 610.00 317,200.00
MV 9990610 STRUCTURAL CONCRETE (CLASS S) (F'C-4,000) CUYD 2174 170.00 369,580.00
MV 9990615 REINFORCING STEEL LB 229300 0.35 80,255.00
MV 9990705 STRUCTURAL CONCRETE (CLASS S) (F'C=3,000) CUYD 525 200.00 105,000.00
MV 9990710 REINFORCING STEEL LB 82395 0.35 28,838.25
MV 9990805 STRUCTURAL CONCRETE (CLASS S) (F'C=3,000) CUYD 543 200.00 108,600.00
MV 9990810 REINFORCING STEEL LB 81415 0.35 28,495.25
MV 9990910 STRUCTURAL CONCRETE (CLASS S) (F'C-3,000) CUYD 123 250.00 30,750.00
MV 9990915 REINFORCING STEEL LB 14055 0.35 4,919.25
MV 9991010 STRUCTURAL CONCRETE (CLASS S) (F'C=3,000) CUYD 111 260.00 28,860.00
MV 9991015 REINFORCING STEEL LB 12225 0.35 4,278.75
-----------------------------------------------------------------------------------------------------------------------------
31,630,864.20
</TABLE>
Page 4
<PAGE>
MEADOW VALLEY CONTRACTORS, INC./R.E. MONKS, A JV MVCI PROJECT NO. 9811
ADOT PROJECT NO. ACSTP-053-1 (31)P PAY ESTIMATE NO.:
MESA-PAYSON HWY (SR 87) PERIOD ENDING DATE:
(SUNFLOWER-MP 226, SEGMENT F)
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------
ITEM UNIT UNIT TOTAL
NO DESCRIPTION UN QUANT PRICE BID PRICE
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
REM 2010001 CLEARING AND GRUBBING LSUM 1 500,000.00 500,000.00
REM 2020036 REMOVAL OF ASPHALTIC CONCRETE PAVEMENT SQYD 76323 0.50 38,161.50
REM 2020042 REMOVAL OF PIPE (OLD SR 87) LF 923 60.00 55,380.00
REM 2020181 ROADWAY OBLITERATION AND RESTORATION LSUM 1 100,000.00 100,000.00
REM 2030120 GRADER ROAD LF 2640 3.00 7,920.00
REM 2030301 ROADWAY EXCAVATION CUYD 4115263 2.40 9,876,631.20
REM 2030401 DRAINAGE EXCAVATION CUYD 2591 5.00 12,955.00
REM 2030812 DYKE (TYPE B) (MEDIAN OR DITCH) CUYD 120 12.00 1,440.00
REM 2060001 FURNISH WATER SUPPLY LSUM 1 1,400,000.00 1,400,000.00
REM 2070001 DUST PALLIATIVE MGAL 35000 11.00 385,000.00
REM 3030022 AGGREGATE BASE, CLASS 2 CUYD 48870 14.50 708,615.00
REM 5010011 PIPE, CORRUGATED METAL, 24in LF 3856 35.00 134,960.00
REM 5010017 PIPE, CORRUGATED METAL, 30in LF 644 60.00 39,640.00
REM 5010025 PIPE, CORRUGATED METAL, 36in LF 2122 82.00 174,004.00
REM 5010030 PIPE, CORRUGATED METAL, 42in LF 1072 110.00 117,920.00
REM 5010035 PIPE, CORRUGATED METAL, 48in LF 1228 110.00 135,080.00
REM 5010055 PIPE, CORRUGATED METAL, 72in LF 586 200.00 117,200.00
REM 5010069 PIPE, CORRUGATED METAL, 90in LF 420 260.00 109,200.00
REM 5010205 PIPE, CORRUGATED METAL, 35in x 24in LF 116 40.00 4,640.00
REM 5014024 FLARED END SECTION, 24in (C-13.25) EACH 26 250.00 6,500.00
REM 5014030 FLARED END SECTION, 30in (C-13.25) EACH 1 350.00 350.00
REM 5014036 FLARED END SECTION, 36in (C-13.25) EACH 11 400.00 4,400.00
REM 5014042 FLARED END SECTION, 42in (C-13.25) EACH 4 450.00 1,800.00
REM 5014235 FLARED END SECTION, 35in x 24in (C-13.25) EACH 2 250.00 500.00
REM 5020072 STRUCTURAL PLATE PIPE, 72in LF 420 350.00 147,000.00
REM 5020120 STRUCTURAL PLATE PIPE, 120in LF 260 500.00 130,000.00
REM 5020144 STRUCTURAL PLATE PIPE, 144in LF 576 650.00 374,400.00
REM 8050023 SEEDING (CLASS II) (MIX H1) ACRE 60 1,400.00 84,000.00
REM 8050024 SEEDING (CLASS II) (MIX H2) ACRE 144 1,600.00 230,400.00
REM 8080285 PIPE (PVC) (6in) (SCHEDULE 40) LF 1484 20.00 29,680.00
REM 8101011 EROSION CONTROL (STRAW BALES) EACH 479 12.00 5,748.00
REM 8101012 EROSION CONTROL (SILT FENCE) LF 43807 1.50 65,710.50
REM 8101016 EROSION CONTROL (ROCK MULCH) (GRADATION C CUYD 198 25.00 4,950.00
REM 9010001 MOBILIZATION LSUM 1 2,288,000.00 2,288,000.00
REM 9120002 SHOTCRETE (CARVED TO REPLICATE NATRL APRN SQYD 14860 75.00 1,114,500.00
REM 9120004 SHOTCRETE (4in) SQYD 14860 25.00 371,500.00
REM 9130001 RIPRAP (DUMPED) (D50=6in) CUYD 8485 45.00 381,825.00
REM 9130002 RIPRAP (WIRE-TIED) (D50=6in) CUYD 10 125.00 1,250.00
REM 9130008 RIPRAP (DUMPED) (D50=9in) CUYD 9000 45.00 405,500.00
REM 9130037 RIPRAP (WIRE-TIED) (D50=9in) SQYD 825 140.00 115,500.00
REM 9130038 RIPRAP (WIRE-TIED) (D50=12in) SQYD 135 165.00 22,275.00
REM 9130051 RIPRAP (DUMPED) (D50=12in) CUYD 2385 75.00 178,875.00
REM 9130052 RIPRAP (DUMPED) (D50=18in) CUYD 770 75.00 57,750.00
REM 9130053 RIPRAP (DUMPED) (D50=24in) CUYD 3060 45.00 137,700.00
REM 9130054 RIPRAP (DUMPED) (D50=30in) CUYD 6130 45.00 275,850.00
REM 9140153 RETAINING WALL (MSE WALL) SQFT 75380 23.00 1,733,740.00
REM 9230001 PROVIDE ON-THE-JOB TRAINING HOUR 1100 0.80 880.00
REM 9240056 MISC WORK (RESHP & GRD EXSTNG PIONEER RD) LSUM 1 25,000.00 25,000.00
REM 9240111 MISC WORK (INSTALL SOIL NAILS) LF 106420 13.00 1,383,460.00
</TABLE>
Page 1
<PAGE>
MEADOW VALLEY CONTRACTORS, INC./R.E. MONKS, A JV MVCI PROJECT NO. 9811
ADOT PROJECT NO. ACSTP-053-1(31)P PAY ESTIMATE NO.:
MESA-PAYSON HWY (SR 87) PERIOD ENDING DATE:
(SUNFLOWER-MP 226, SEGMENT F)
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------
ITEM UNIT UNIT TOTAL
NO DESCRIPTION UN QUANT PRICE BID PRICE
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
REM 9240121 MISC WORK (VERIFICATION TEST NAILS) EACH 45 1,500.00 67,500.00
REM 9990100 STR EXC - SYCAMORE CR BR NB&SB CUYD 520 3.50 1,820.00
REM 9990105 STRUCTURE BACKFILL CUYD 1220 10.00 12,200.00
REM 9990165 RIP RAP (WIRED-TIED) CUYD 1500 85.00 127,500.00
REM 9990200 STR EXC - LWR KITTY JOE CRK BR NB&SB CUYD 20 8.00 160.00
REM 9990205 STRUCTURE BACKFILL CUYD 340 10.00 3,400.00
REM 9990300 STR EXC - WHISKEY SPRINGS BRIDGE NB&SB CUYD 60 8.00 480.00
REM 9990305 STRUCTURE BACKFILL CUYD 488 24.00 11,712.00
REM 9990400 STR EXC - UPPER KITTY JOE BRIDGE NB&SB CUYD 925 8.00 7,400.00
REM 9990405 STRUCTURE BACKFILL CUYD 2300 10.00 23,000.00
REM 9990500 STR EXC - COTTONWOOD BRIDGE NB&SB CUYD 200 8.00 1,600.00
REM 9990505 STRUCTURE BACKFILL CUYD 1280 10.00 12,800.00
REM 9990600 STR EXC - BOX CULV STA 2584+80-BR #7041 CUYD 250 8.00 2,000.00
REM 9990605 STRUCTURE BACKFILL CUYD 5640 12.00 67,680.00
REM 9990700 STR BACKFILL - BOX CULV STA 2590+50 CUYD 3651 12.00 43,812.00
REM 9990800 STR BACKFILL - BOX CULV STA 2750+50 CUYD 4071 12.00 48,852.00
REM 9990900 STR EXC - BOX CULV SYCAMORE CR STA 26+00 CUYD 30 15.00 450.00
REM 9990905 STRUCTURE BACKFILL CUYD 550 16.00 8,800.00
REM 9991000 STR EXC - BOX CULV SYCAMORE CR STA 56+00 CUYD 21 15.00 315.00
REM 9991005 STRUCTURE BACKFILL CUYD 480 16.00 7,680.00
------------------------------------------------------------------------------------------------------------------------------
23,945,451.20
</TABLE>
Page 2
<PAGE>
EXHIBIT 10.89
CONTRACT AGREEMENT
THIS AGREEMENT, made and entered into this 21ST day of JULY, 1998, 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. / R.E. MONKS CONSTRUCTION CO. (JV) 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.
087 MA 218 H230602C ACSTP-053-1(31)P
MESA - PAYSON HIGHWAY (SR 87)
(Sunflower - MP 226, Segment F)
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, and 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 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.
<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 unacceptable 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, except the contractor is not
required to indemnify or save harmless the State from liability arising from the
negligence of the State.
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.
087 MA 218 H230602C STP-053-(31)P
MESA-PAYSON HIGHWAY (SR 87)
(Sunflower - MP 226 Segment F)
Witness our hands and seals this 21ST day of JULY 1998
STATE OF ARIZONA
By: /s/ [SIGNATURE
------------------------------------
Department of Transportation
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. /
R.E. Monks Construction Co. (JV)
----------------------------------------
By: /s/ Bradley E. Larson
-------------------------------------
Contractor
BRADLEY E. LARSON, PRESIDENT
Of Meadow Valley Contractors, Inc.
Authorized To Sign For The Joint Venture
Attest: /s/ Robert W. Bottcher PARTY OF THE SECOND PART
---------------------------
Seal
<PAGE>
BIDDING SCHEDULE
TRACS NUMBER FEDERAL NUMBER
087 MA 218 H230602C ACSTP-053-1(31)P
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
ITEM NO ITEM DESCRIPTION UNIT QUANTITY UNIT PRICE AMOUNT
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
BOX CULVERT SYCAMORE CREEK ROAD STA. 26+00 RIKRIK RIKRIK
- -----------------------------------------------------------------------------------------------------------------------------
2030501N STRUCTURAL EXCAVATION CU.YD. 30 15.00 450.00
- -----------------------------------------------------------------------------------------------------------------------------
2030506N STRUCTURE BACKFILL CU.YD. 550 16.00 8,800.00
- -----------------------------------------------------------------------------------------------------------------------------
6010002N STRUCTURAL CONCRETE (CLASS S) (F'c = 3,000) CU.YD. 123 250.00 30,750.00
- -----------------------------------------------------------------------------------------------------------------------------
6050002N REINFORCING STEEL LB. 14,055 0.35 4,919.25
- -----------------------------------------------------------------------------------------------------------------------------
BOX CULVERT SYCAMORE CREEK ROAD STA. 56+00 RIKRIK RIKRIK
- -----------------------------------------------------------------------------------------------------------------------------
2030501O STRUCTURAL EXCAVATION CU.YD. 21 15.00 315.00
- -----------------------------------------------------------------------------------------------------------------------------
2030506O STRUCTURE BACKFILL CU.YD. 480 16.00 7,680.00
- -----------------------------------------------------------------------------------------------------------------------------
6010002O STRUCTURAL CONCRETE (CLASS S) (F'c = 3,000) CU.YD. 111 260.00 28,860.00
- -----------------------------------------------------------------------------------------------------------------------------
6050002O REINFORCING STEEL LB. 12,225 0.35 4,278.75
- -----------------------------------------------------------------------------------------------------------------------------
CONTRACT TOTAL: 55,594,609.40
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
EXHIBIT 10.90
THIS AGREEMENT made and executed in FOUR (4) original counterparts this
23RD day of September A.D. 1998 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 GRASSY MOUNTAIN EASTBOUND & WESTBOUND REST AREA IN TOOELE
COUNTY, State of Utah, the same being identified as *INH-80-2(47)55 for the
approximate sum of THREE MILLION FOUR HUNDRED TWENTY EIGHT THOUSAND EIGHTY
THREE AND 75/100 Dollars ($3,428,583.75).
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 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
/s/ [SIGNATURE ILLEGIBLE] /s/ [SIGNATURE ILLEGIBLE]
- ---------------------------- ------------------------------
Secretary Director of Transportation -
First Party
Witnesses:
____________________________ Meadow Valley Contractors, Inc.
------------------------------
Second Party
/s/ Tortina M. Bunton
- ----------------------------
Approved as to form: by /s/ Kenneth D. Nelson
-----------------------------
By /s/ [SIGNATURE ILLEGIBLE] Vice President
- ------------------------------- -----------------------------
Assistant Attorney General Title
94-279836-5501
APPROVED ______________________ ------------------------------
Director of Finance Utah Contractor License Number
FUNDS AVAILABLE _______________
/s/ [SIGNATURE 10/01/98
---------------------------------------
Budget Officer Date
<PAGE>
EXHIBIT 10.91
CLARK COUNTY, NEVADA
BID PROPOSAL
BID NO. 4182-98
LAS VEGAS BELTWAY - WESTERN SECTIONS 7, 8 AND 9
REVISED PER ADDENDUM NO. 2
--------------------------
MEADOW VALLEY CONTRACTORS, INC.
- --------------------------------------------------------------------------------
(NAME)
P.O. BOX 549, MOAPA, NEVADA 89025
- --------------------------------------------------------------------------------
(ADDRESS)
THE UNDERSIGNED PROPOSES AND AGREES:
1. To complete all work for which a contract may be awarded to the Bidder and
to furnish any and all labor, equipment, materials, transportation, and
other facilities required for the services as set forth in the Proposal and
Contract Documents.
2. That the Bidder has examined the Contract Documents and the site(s) for the
proposed work and satisfied themselves as to the character, quality of work
to be performed, materials to be furnished and as to the requirements of
the specifications.
3. That the Bidder has completed all information in the blanks provided and
has submitted the following within this bid proposal:
a. Each subcontractor which will be paid an amount exceeding five percent
(5%) of the total bid amount.
b. Has represented their qualification for Preferential Bidder Status.
c. Has submitted a bid security (in the form of, at Bidder's option. A
Cashiers Check, Certified Check, Money Order, or Bid Bond in favor of
the Owner(s) in the amount of Five Percent (5%) of the bid amount.
4. If the Bidder is one of the three (3) apparent low bidders at the bid
opening, they must submit Bid Attachment 2 within two hours after
completion of the bid opening. Faxing is not allowed. This Attachment must
----
be time stamped by the Department of General Services. Submission after the
-----------------------------------------------------
two (2) hour time limit will be rejected and/or returned unopened and the
bid may be deemed non-responsive.
a. Projects EXCEEDING Five Million Dollars ($5,000,000).
---------
1) The Bidders shall list subcontractors which will provide
labor/improvements exceeding one percent (1%) of the prime
contractor's total bid amount, or $50,000.00, whichever is greater.
5. Upon faxed receipt of a letter of Intent to Award the contract, the bidder
will provide the following submittals within seven (7) days from receipt of
the Notice.
a. Performance Bond, Labor and Material Payment Bond and a Guaranty Bond,
for One Hundred Percent (100%) of the contract price as required.
b. Certificates of insurance for Commercial General Liability in the
amount of $1,000,000, Automobile Liability in the amount of
$1,000,000, Explosion, Collapse and Underground in the amount of
$1,000,000 Installation Floater and a SIIS certificate as required by
law.
c. Certificate of insurance for Commercial General Liability in the
amount of $5,000,000 with Kern River Gas Transmission Company named as
sole beneficiary of proceeds.
6. That if the Bidder does not provide the above submittals on or before the
seventh (7th) calendar day, or does not keep the bonds or insurance
policies in effect or allows them to lapse, the Bidder will pay over to the
Owner the amount of sixteen thousand five hundred dollars ($16,500.) per
day as liquidated damages.
7. That this Proposal is genuine and is not sham or collusive, or made in the
interest of, or on behalf of any person not herein named, nor the Bidder in
any manner sought to secure for themselves an advantage over any other
bidder.
8. The Bidder further proposes and agrees that if his bid is accepted they
will commence to perform the work called for by the plans and Contract
Documents within seven (7) calendar days after Notice to Proceed is issued
and will complete all work within the calendar days specified in the
instruction to Bidders.
<PAGE>
Bid Proposal
Bid No. 4182-98
Revised per ADDENDUM NO.2
Las Vegas Beltway
14. CLAIM OF PREFERENTIAL BIDDER STATUS
-----------------------------------
Bidder hereby claims that their firm has paid the sale and use tax and/or
the motor privilege vehicle tax for each consecutive 12-month period for
sixty (60) months immediately preceding the submission of this bid in the
amounts necessary to qualify for the preferential bidder status pursuant to
NRS 338.147.
IF BIDDER DOES NOT QUALIFY FOR PREFERENTIAL BIDDER STATUS, CHECK HERE [_].
15. FOR INFORMATIONAL PURPOSES ONLY:
-------------------------------
The General Contractor submitting this bid is a [_] MBE [_] WBE [_] PBE [_]
SBE [_] NBE [_] LBE as defined in the instructions to Bidders.
16. /s/ Alan Terril MEADOW VALLEY CONTRACTORS, INC.
------------------------------ -------------------------------
SIGNATURE OF BIDDER LEGAL NAME OF FIRM AS IT WOULD APPEAR
IN CONTRACT
ALAN TERRIL 702-864-2575 702-864-2580
------------------------------ ---------------- -------------
NAME OF BIDDER (PRINT OR TYPE) TELEPHONE NUMBER FAX NUMBER
P.O. BOX 549 # 0019258
------------------------------ --------------------------------------
ADDRESS OF FIRM NEVADA STATE CONTRACTOR'S LICENSE NO.
MOAPA, NV 89025 A UNLIMITED
------------------------------ ---------------- --------------------
CITY, STATE, ZIP CODE CLASSIFICATION MONETARY LIMITATIONS,
IF ANY
8-28-98 BUSINESS LICENSE:
------------------------------ [X] CLARK COUNTY - NO. 041648-240-8
TODAY'S DATE -------------
[X] CITY OF LAS VEGAS - NO. 59416
-------------
<PAGE>
Bid Proposal
Bid No. 4182-98
Revised per Addendum No. 2
Las Vegas Beltway
<TABLE>
<CAPTION>
========================================================================================================
ITEM NO. DESCRIPTION APRROX. UNIT UNIT BID TOTAL
QUANTITY PRICE
<S> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------
634.04 PERMANENT PAVEMENT MARKING FILM, TYPE 1 475 LF $15.34 $ 7,286.50
(24-INCH SOLID WHITE)
- --------------------------------------------------------------------------------------------------------
634.05 PERMANENT PAVEMENT MARKING FILM, TYPE 1 1,230 LF $11.88 $ 14,612.40
(24-INCH SOLID YELLOW)
- --------------------------------------------------------------------------------------------------------
634.06 PERMANENT PAVEMENT MARKING FILM, TYPE 1 257 SF $ 7.67 $ 1,971.19
(STOP BARS)
- --------------------------------------------------------------------------------------------------------
634.07 PERMANENT PAVEMENT MARKING FILM, TYPE 1 791 SF $13.50 $ 10,678.50
(LEGENDS)
- --------------------------------------------------------------------------------------------------------
634.08 PERMANENT PAINTED STRIPING (4-INCH SOLID 41,285 LF $ 0.09 $ 3,715.65
WHITE)
- --------------------------------------------------------------------------------------------------------
634.09 PERMANENT PAINTED STRIPING (4-INCH SOLID 26,115 LF $ 0.09 $ 2,350.35
YELLOW)
- --------------------------------------------------------------------------------------------------------
634.10 PERMANENT PAINTED STRIPING (8"SOLID 19,600 LF $ 0.17 $ 3,332.00
WHITE)
- --------------------------------------------------------------------------------------------------------
634.11 PERMANENT PAINTED STRIPING (8" SOLID 1,940 LF $ 0.17 $ 329.80
YELLOW)
- --------------------------------------------------------------------------------------------------------
634.12 PERMANENT PAINTED STRIPING (4" DOUBLE 1,320 LF $ 0.17 $ 224.40
SOLID YELLOW)
- --------------------------------------------------------------------------------------------------------
634.13 MEDIAN PAINT 100 SF $ 1.62 $ 162.00
- --------------------------------------------------------------------------------------------------------
635.01 TEMPORARY STRIPING TAPE (8-INCH WHITE 5,580 LF $ 1.46 $ 8,146.80
EDGE LINE)
- --------------------------------------------------------------------------------------------------------
635.02 TEMPORARY STRIPING TAPE (8-INCH WHITE 33,110 LF $ 1.46 $ 48,340.60
EDGE LINE)
- --------------------------------------------------------------------------------------------------------
635.03 TEMPORARY STRIPING TAPE (24-INCH SOLID 1,620 SF $ 4.43 $ 7,176.60
YELLOW)
- --------------------------------------------------------------------------------------------------------
635.04 TEMPORARY STRIPING TAPE (24-INCH SOLID 120 LF $ 8.86 $ 1,063.20
WHITE)
- --------------------------------------------------------------------------------------------------------
642.01 SOIL NAIL RETAINING WALL 12,565 SF $51.30 $ 644,584.50
- --------------------------------------------------------------------------------------------------------
TOTAL AMOUNT IN $55,394,771.96
========================================================================================================
</TABLE>
Fifty Five million, three hundred ninety four thousand seven hundred seventy one
dollars ninety six cents.
- --------------------------------------------------------------------------------
TOTAL AMOUNT IN WORDS
Revised 5-11
<PAGE>
EXHIBIT 10.92
[LOGO OF LIBERTY
BOND SERVICES APPEARS HERE]
GENERAL AGREEMENT OF INDEMNITY
This General Agreement of Indemnity ("Agreement") is made and entered into
by the following individuals, partnerships and/or corporations, MEADOW VALLEY
CORPORATION AND ANY OF ITS PRESENT OR FUTURE, DIRECTLY OR INDIRECTLY MAJORITY-
OWNED OR CONTROLLED SUBSIDIARIES OR AFFILIATES, WHETHER ALONE OR IN JOINT
VENTURE WITH OTHERS NOT NAMED HEREIN; AND ANY CORPORATION, PARTNERSHIP OR PERSON
UPON THE WRITTEN REQUEST OF ANY OF THE UNDERSIGNED individually and collectively
hereinafter called ("Principals"), who intend to assume the obligations of
Principals, as noted in this Agreement, with respect to any surety bond,
undertaking, recognizance, instrument of guarantee or other surety obligation
(hereinafter called "Bonds") requested and/or issued, before or after the date
of this Agreement by Liberty Mutual Insurance Company, a Massachusetts
corporation, on behalf of itself and LM Insurance Corporation, an Iowa
corporation; The First Liberty Insurance Corporation, and Iowa corporation;
Liberty Mutual Fire Insurance Company, a Massachusetts corporation; Liberty
Insurance Corporation, a Vermont corporation; and any other company that is part
of or added to the Liberty Mutual Group for which surety business is
underwritten by Liberty Bond Services (hereinafter called the "Surety") on
behalf of such Principals and all of the above listed Principals (individually
and collectively hereinafter called "Indemnitors" in this secondary capacity),
jointly and severally, also intend to assume the obligations of Indemnitors, as
noted in this Agreement, with respect to any and all Bonds heretofore, presently
or hereafter requested and/or issued by the Surety on behalf of any or all
Principals.
WITNESSETH
WHEREAS, the Principals, in the performance of contracts and the
fulfillment of obligations generally, whether in their own names solely or as
co-adventurers with others, may desire, request, or be required to give or
procure certain Bonds, and/or to renew, continue, extend or substitute, from
time to time, the same or new Bonds with the same or different penalties, and/or
conditions, as may be desired, requested or required, in the renewal,
continuation, extension and/or substitution thereof; or the Principals or
Indemnitors may request the Surety to refrain from canceling the Bonds; and
WHEREAS, at the request of the Principals and the Indemnitors and with the
express understanding that this Agreement be given, the Surety has heretofore or
has presently been requested to and/or has executed or has procured to be
executed, and, from time to time hereafter, may be requested to and/or may
execute or may procure to be executed, the Bonds on behalf of the Principals;
and
WHEREAS, the Indemnitors have a substantial, material and beneficial
interest in the obtaining of the Bonds or in the Surety's refraining from
canceling the Bonds.
NOW, THEREFORE, in consideration of the premises, and intending to be
legally bound hereby, the Principals and Indemnitors for themselves, their
heirs, executors, administrators, successors and assigns, jointly and severally,
hereby covenant and agree with the Surety, its successors and assigns, as
follows:
FIRST: PREMIUMS - The Principals and Indemnitors will pay to the Surety,
promptly upon demand, all premiums, costs and charges of the Surety for Bonds
requested and/or issued by the Surety in accordance with its rate filings, its
manual of rates, or as otherwise agreed upon, and where such premium, costs and
charges are annual, continue to pay the same until the Principals of Indemnitors
shall deliver evidence satisfactory to the Surety of its discharge or release
from the Bonds and all liability by reason thereof.
SECOND: INDEMNITY - The Principals and Indemnitors shall exonerate,
indemnify, and keep indemnified the Surety from and against any and all
liability for losses, fees, costs and expenses of whatsoever kind or nature
(including, but not limited to interest, court costs and counsel (fees) and from
and against any and all such losses, fees, costs and expenses which the Surety
may sustain or incur: (1) by reason of being requested to execute or procure the
execution of any Bonds; or (2) by having executed or procured the execution of
any Bonds; or (3) by reason of the failure of the Principals or Indemnitors to
perform or comply with any of the covenants and conditions of this Agreement;
or (4) in enforcing any of the covenants and conditions of this Agreement.
Payment by reason of the aforesaid causes shall be made to the Surety by the
Principals and Indemnitors promptly, upon demand by the Surety, whether or not
the Surety shall have made any payment therefor. In the event of any payment by
the Surety, the Principals and Indemnitors further agree that in any accounting
between the Surety and the Principals, or between the Surety and the
Indemnitors, or either or both of them, the Surety shall be entitled to charge
for any and all disbursements made by it in good faith in and about the matters
herein contemplated by this Agreement under the belief that is , or was, or
might be liable for the sums and amounts so disbursed or that is was necessary
or expedient to make such disbursements, whether or not such liability,
necessity or expediency existed; and that the vouchers or other evidence or any
such payments made by the Surety shall be prima facie evidence of the fact and
amount of liability to the Surety. If for any reason the Surety shall deem it
necessary to set up or to increase a reserve to cover any possible liability for
losses and/or fees, costs and expenses for which the Principals and the
Indemnitors will be obliged to indemnify the Surety under the terms of this
Agreement, the Principals and the Indemnitors will deposit with the Surety,
promptly upon demand, a sum of money equal to such reserve (including any fees,
costs and expenses) and any increase thereof as collateral security to the
Surety for such liabilities. The Surety shall have the right to use the deposit,
or any part thereof, in payment or settlement of any such liabilities for which
the Principals and the Indemnitors would be obliged to indemnify the Surety
under the terms of this Agreement.
THIRD ASSIGNMENT - The Principals and the Indemnitors hereby consenting,
will assign, transfer, pledge and convey to the Surety, and do hereby assign,
transfer, pledge and convey to the Surety, as collateral security for the full
performance of the covenants and agreements herein contained and for the payment
of any other indebtedness or liability of the Principals and/or Indemnitors to
the Surety, whether heretofore or hereafter incurred, the assignment in the case
of each contract shall become effective as of the date of the Bond covering such
contract, but only in the event of: (1) any abandonment, forfeiture or breach of
any contract referred to in the Bonds or of any breach of any Bond; or (2) a
default in discharging any other indebtedness or liabilities incurred in
connection therewith, when due; or (3) any breach of the covenants and
conditions of this Agreement; or (4) any assignment by the Principals for the
benefit of creditors, or of the appointment, or of any application for the
appointment, of a receiver or trustee for the Principals whether insolvent or
not; or (5) any proceeding which deprives the Principals of the use of any of
the machinery, supplies, equipment, plant, tools or material referred to in
section (b) of this paragraph; or (6) the Principal's dying, absconding,
disappearing, incompetency, insolvency, being convicted of a felony, or
imprisoned, if the Principal by an individual: (a) all the right, title and
interest of the Principals and the Indemnitors in, and growing in any manner out
of, all contracts referred to in the Bonds, or in, or growing in any manner out
of the Bonds; (b) all the right, title and interest of the Principals and the
Indemnitors in and to all machinery, supplies, equipment, plant, tools and
materials which are now, or may hereafter be, about or upon the site or sites of
any and all contractual work referred to in the Bonds or elsewhere, including
materials purchased for or chargeable to any and all contracts referred to in
the Bonds, materials which may be in the process of construction, in storage at
the site or elsewhere, or in transportation to any and all sites; (c) all the
right, title and interest of the Principals and the Indemnitors in and to all
subcontracts let or to be let in connection with any and all contracts
1
<PAGE>
LIBERTY BOND SERVICES, GENERAL AGREEMENT OF INDEMNITY
Indemnitors: Meadow Valley Corporation and any of its present or future,
directly or indirectly majority-owned or controlled subsidiaries or
affiliates, whether alone or in joint venture with others not named
herein; and any corporation, partnership or person upon the written
request of any of the undersigned
- ------------------------------------------------------------------------------
referred to in the Bonds, and in and to all surety bonds supporting such
subcontracts; (d) all actions, causes of actions, claims and demands
whatsoever which the Principals and the Indemnitors may have or acquire
against any subcontractor, laborer or materialman, or any person
furnishing or agreeing to furnish or supply labor, material, supplies,
machinery, tools, other equipment in connection with or on account of any
and all contracts referred to in the Bonds; and against any surety or
sureties of any subcontractor, laborer or materialman; and (e) any and all
percentages retained and any and all sums that may be due or hereafter
become due on account of any and all contracts referred to in the Bonds
and all other contracts whether bonded or not in which the Principals or
the Indemnitors have an interest.
FOURTH: UNIFORM COMMERCIAL CODE - This Agreement shall constitute a
Security Agreement to the Surety and also a Financing Statement, both
in accordance with the provisions of the Uniform Commercial Code of every
jurisdiction wherein such Code is in effect and may be so used by the
Surety without in any way abrogating, restricting or limiting the rights
of the Surety under this Agreement or under law, or in equity. A carbon,
photographic or other reproduction of this Agreement may be filed as a
Financing Statement.
FIFTH: TAKEOVER - In the event of any breach or default asserted by the
obligee in any Bond, or the Principals have abandoned the work on or
forfeited any contract or contracts covered by any Bond, or have failed to
pay obligations incurred in connection therewith, or in the event of the
Principal's dying, absconding, disappearing, incompetency, insolvency,
being convicted of a felony, or imprisoned, if the Principal be an
individual, bankruptcy of the Principals, or the appointment of a
receiver or trustee for the Principals or the property of the Principals,
or in the event of an assignment for the benefit of creditors of the
Principals, or if any action is taken by or against the Principals under
or by virtue of the Federal Bankruptcy Code, or should reorganization
or arrangement proceedings be filed by or against the Principals under
said Code, or if any action is taken by or against the Principals under
the Insolvency laws of any state, possession or territory of the United
States, the Surety shall have the right, at its option and in its sole
discretion and is hereby authorized, with or without exercising any
other right or option conferred upon it by law or under the terms of this
Agreement, to take possession of any part or all of the work under any
contract or contracts covered by any Bond, and at the expense of the
Principals and Indemnitors to complete or arrange for the completion of
the same, and the Principals and Indemnitors shall promptly, upon demand,
pay to the Surety all losses, fees, costs and expenses so incurred.
SIXTH: CHANGES - The Surety is authorized and empowered, without notice to
or knowledge of the Indemnitors, to assent to any change whatsoever in the
Bonds, and/or any contracts referred to in the Bonds, and/or in the
general conditions, plans and/or specifications accompanying said
contracts, including, but not limited to, any change in the time for the
completion of said contracts and to payments or advances thereunder
before the same may be due, and to assent to or take any assignment or
assignments, to execute or consent to the execution of any continuations,
extensions or renewals of the Bonds and to execute any substitute or
substitutes therefor, with the same or different conditions, provisions
and obligees and with the same or larger or smaller penalties, it being
expressly understood and agreed that the Indemnitors shall remain bound
under the terms of this Agreement even though any such assent by the
Surety does or might substantially increase the liability of said
Indemnitors.
SEVENTH: ADVANCES - The Surety is authorized and empowered, in its sole
discretion and without any obligation to do so, to guarantee loans, to
advance or lend to the Principals any money, which the Surety may see
fit, for the purpose of any contracts referred to in, or guaranteed by
the Bonds, and all money expended in connection with the investigation
and/or in the completion of any such contracts by the Surety, or lent or
advanced from time to time to the Principals, or guaranteed by the
Surety for the purposes of any such contracts, and any and all other costs
and expenses incurred by the Surety in relation thereto, unless repaid
with legal interest by the Principals to the Surety when due, shall be
presumed to be a loss by the Surety for which the Principals and the
Indemnitors shall be responsible notwithstanding that said money or any
part thereof should not be so used by the Principals.
EIGHTH: BOOKS AND RECORDS - At any time, and until such time as the
liability of the Surety under any and all Bonds is terminated, the
Surety shall have the right of reasonable access to the books, records
and/or accounts of the Principals and Indemnitors; and any bank
depository, materialman, supply house or other person, firm or
corporation when requested by the Surety is hereby authorized to
furnish the Surety any information requested including, but not
limited to, the status of the work under contracts being performed by
the Principals, the condition of the performance of such contracts and
payments of accounts.
NINTH: DECLINE EXECUTION - Unless otherwise specifically agreed in writing,
the Surety may decline to execute any Bond and the Principals and
Indemnitors agree to make no claim to the contrary in consideration of
the Surety's receiving this Agreement, and if the Surety shall execute
a Bid or Proposal Bond, it shall have the right to decline to execute any
other Bonds that may be required in connection with any award that may be
made under the proposal for which the Bid or Proposal Bond is given, and
such declination shall not diminish or alter the liability that may arise
by reason of having executed the Bid or Proposal Bond. The Principals and
the Indemnitors acknowledge that the Surety makes no representation as to
the validity or acceptability of any of its Bonds to any person, firm or
entity of whatever sort or kind under any contract. The Principals and the
Indemnitors agree that they shall have no claim against the Surety arising
out of or in any manner relating to the failure or refusal of any person,
firm or entity of whatever sort or kind to award any contract to the
Principals, or to accept any Bond executed and delivered by the Surety, or
that the Surety has been requested to execute and delivery.
TENTH: NOTICE OF EXECUTION - The Indemnitors hereby waive notice of the
execution of the Bonds and of the acceptance of this Agreement, and the
Principals and the Indemnitors hereby waive all notice of any default, or any
other act or acts giving rise to any claim under the Bonds, as well as notice of
any and all liability of the Surety under the Bonds, and any and all liability
on their part hereunder, to the end and effect that, the Principals and the
Indemnitors shall be and continue to be liable hereunder, notwithstanding any
notice of any kind to which they might have been or be entitled, and
notwithstanding any defenses they might have been entitled to make.
ELEVENTH: TRUST FUND - If any of the Bonds are executed in connection with
a contract which by its terms or by law prohibits the assignment of the
contract price, or any part thereof, the Principals and Indemnitors covenant
and agree that all payments for or on account of said contract shall be held
as a trust fund in which the Surety has an interest, for the payment of
obligations incurred in the performance of the contract and for labor,
materials, and services furnished in the prosecution of the work provided in
said contract or any authorized extension or modification thereof; and,
further, it is expressly understood and declared that all monies due and
to become due under any contract or contracts covered by the Bonds are
trust funds, whether in the possession of the Principals or Indemnitors or
otherwise, for the benefit of and for payment of all such obligations in
connection with any such contract or contracts for which the Surety would
be liable under any Bonds; said trust also inures to the benefit of the
Surety for any liability or loss it may have or sustain under any of the said
Bonds, and this Agreement and declaration shall also constitute notice
of such trust.
2
<PAGE>
LIBERTY BOND SERVICES, GENERAL AGREEMENT OF INDEMNITY
INDEMNITORS: MEADOW VALLEY CORPORATION AND ANY OF ITS PRESENT OR FUTURE,
DIRECTLY OR INDIRECTLY MAJORITY-OWNED OR CONTROLLED SUBSIDIARIES OR
AFFILIATES, WHETHER ALONE OR IN JOINT VENTURE WITH OTHERS NOT NAMED
HEREIN; AND ANY CORPORATION, PARTNERSHIP OR PERSON UPON THE WRITTEN
REQUEST OF ANY OF THE UNDERSIGNED
- --------------------------------------------------------------------------------
TWELFTH: HOMESTEAD - The Principals and the Indemnitors hereby waive, so far as
their respective obligations under this Agreement are concerned, all rights to
claim any of their property including their respective homesteads, as exempt
from levy, execution, sale or other legal process under the laws of any state,
territory or possession.
THIRTEENTH: SETTLEMENTS - The Surety shall have the right, at its option and
sole discretion, to adjust, settle or compromise any claim, demand, suit or
judgment upon the Bonds, unless the Principals and the Indemnitors shall request
the Surety to litigate such claim or demand, or to defend such suit, or to
appeal from such judgment, and shall deposit with the Surety, at the time of
such request, cash or collateral satisfactory to the Surety in kind and amount
to be used in paying any judgment or judgments rendered or that may be rendered,
with interest, costs, expenses and attorneys' fees, including those of the
Surety.
FOURTEENTH: SURETIES - In the event the Surety procures the execution of the
Bonds by other sureties, or executes the Bonds with co-sureties, or reinsures
any portion of the Bonds with reinsuring sureties, than all the terms and
conditions of this Agreement shall inure to the benefit of such other sureties
co-sureties and reinsuring sureties, as their interests may appear.
FIFTEENTH: SUITS - Separate suits may be brought hereunder as causes of action
accrue, and the bringing of suit or the recovery of judgment upon any cause of
action shall not prejudice or bar the bringing of other suits upon other causes
of action, whether theretofore or thereafter arising.
SIXTEENTH: OTHER INDEMNITY - The Principals and the Indemnitors shall continue
to remain bound under the terms of this Agreement even though the Surety may
have from time to time heretofore or hereafter, with or without notice to or
knowledge of the Principals and the Indemnitors, accepted or released other
agreements of Indemnity or collateral in connection with the execution or
procurement of the Bonds, from the Principals or Indemnitors and/or others, it
being expressly understood and agreed by the Principals and the Indemnitors that
any and all other rights which the Surety may have or acquire against the
Principals and the Indemnitors and/or others under any such other or additional
agreements of indemnity or collateral shall be in addition to, and not in lieu
of, the rights afforded the Surety under this Agreement.
SEVENTEENTH: INVALIDITY - In case any of the parties mentioned in this Agreement
fail to execute the same, or in case the execution hereof by any of the parties
be defective or invalid for any reason, such failure, defect or invalidity shall
not in any manner affect the validity of this Agreement or the liability
hereunder of any of the parties executing the same, but each and every party so
executing shall be and remain fully bound and liable hereunder to the same
extent as if such failure, defect or invalidity had not existed. It is
understood and agreed by the Principals and Indemnitors that the rights, powers,
and remedies given the Surety under this Agreement shall be and are in addition
to, and not in lieu of, any and all other rights, powers, and remedies which the
Surety may have or acquire against the Principals and Indemnitors or others
whether by the terms of any other agreement or by operation of law or otherwise.
EIGHTEENTH: ATTORNEY IN FACT - The Principals and Indemnitors hereby irrevocably
nominate, constitute, appoint and designate the Surety as their attorney-in-fact
with the full right and authority, but not the obligation, to exercise all the
rights of the Principals and Indemnitors assigned, transferred and set over to
the Surety In this Agreement, with full power and authority to execute on behalf
of and sign the names of the Principals and Indemnitors to any voucher,
financing statement, release, satisfaction, check, bill of sale of all or any
property by this Agreement assigned to the Surety, or other documents or papers
deemed necessary and proper by the Surety in order to give full effect not only
to the Intent and meaning of the within assignments, but also to the full
protection intended to be herein given to the Surety under all other provisions
of this Agreement. The Principals and Indemnitors hereby ratify and confirm all
acts and actions taken and done by the Surety as such attorney-in-fact.
NINETEENTH: TERMINATION - This Agreement may be terminated by the Principals or
Indemnitors upon twenty days' written notice sent by registered mail to the
Surety at its home office at 600 W, Germantown Pike, #300, Plymouth Meeting,
Pennsylvania 19462, but any such notice of termination shall not operate to
modify, bar, or discharge the Principals or the Indemnitors as to the Bonds that
may have been theretofore executed.
TWENTIETH: AMENDMENTS - This Agreement may not be changed or modified orally. No
change or modification shall be effective unless made by written endorsement
executed to form a part hereof.
TWENTY-FIRST: JURISDICTION - As to any legal action or proceeding related to
this Agreement, the Principals and Indemnitors consent to the general
jurisdiction of any local, state or federal court of competent subject matter
jurisdiction and waive any claim or defense in any such action or proceeding
based on any alleged lack of personal jurisdiction; improper venue, forum non
conveniens or any similar basis. Principals and Indemnitors further waive
personal service or any end all process.
TWENTY-SECOND: ENTIRE AGREEMENT - THE PRINCIPALS AND THE INDEMNITORS REPRESENT
TO THE SURETY THAT THEY HAVE CAREFULLY READ THIS ENTIRE AGREEMENT AND THAT THERE
ARE NO OTHER AGREEMENTS OR UNDERSTANDINGS, WHETHER ORAL OR WRITTEN, THAT IN
ANY WAY MODIFY, CHANGE OR VITIATE THE OBLIGATIONS OF THIS AGREEMENT EXCEPT AS
EXPRESSLY SET FORTH BELOW.
TWENTY-THIRD: NONE
----
DATED as of this 1st day of September, 1998.
3
<PAGE>
LIBERTY BOND SERVICES, GENERAL AGREEMENT OF INDEMNITY
INDEMNITORS: MEADOW VALLEY CORPORATION AND ANY OF ITS PRESENT OR FUTURE,
DIRECTLY OR INDIRECTLY MAJORITY-OWNED OR CONTROLLED SUBSIDIARIES OR
AFFILIATES, WHETHER ALONE OR IN JOINT VENTURE WITH OTHERS NOT NAMED
HEREIN; AND ANY CORPORATION, PARTNERSHIP OR PERSON UPON THE WRITTEN
REQUEST OF ANY OF THE UNDERSIGNED
- -------------------------------------------------------------------------------
WITNESS/ATTEST:
MEADOW VALLEY CORPORATION
--------------------------------------------
(Full Name & Address of Principal)
4411 S. 40/th/ ST., STE. D-11
PHOENIX, AZ 85040
---------------------------------------------
By: Julie L. Bergo By: Bradley E. Larson
- ----------------------------- -----------------------------(Seal)
Julie L. Bergo, Secretary Bradley E. Larson, President
================================================================================
TO BE SIGNED BY H.O. COMPANY OFFICER ONLY
_______________________________(Surety)
By:_____________________________ By:____________________________(Seal)
================================================================================
4
<PAGE>
LIBERTY BOND SERVICES, GENERAL AGREEMENT OF INDEMNITY
INDEMNITORS: MEADOW VALLEY CORPORATION AND ANY OF ITS PRESENT OR FUTURE,
DIRECTLY OR INDIRECTLY MAJORITY-OWNED OR CONTROLLED SUBSIDIARIES OR
AFFILIATES, WHETHER ALONE OR IN JOINT VENTURE WITH OTHERS NOT NAMED
HEREIN; AND ANY CORPORATION, PARTNERSHIP OR PERSON UPON THE WRITTEN
REQUEST OF ANY OF THE UNDERSIGNED
- --------------------------------------------------------------------------------
FOR NOTARIAL ACKNOWLEDGMENT OF PRINCIPAL/INDEMNITOR'S SIGNATURE
CORPORATE ACKNOWLEDGMENT
State of Arizona
-------------------)
)SS
County of Maricopa
------------------)
On this 1/st/ day of Sept, in the year 1998, before me personally comes
BRADLEY E. LARSON to me known, who being by me duly sworn, deposes and says that
(s)he resides in the City of PHOENIX that (s)he is the PRESIDENT of MEADOW
VALLEY CORPORATION, the corporation described in and which executed the
foregoing instrument; that (s)he knows the seal of the said corporation: that
the seal affixed to the said Instrument is such corporate seal; that it was so
affixed by the order of the Board of Directors of said corporation, and that
(s)he signed (his)(her) name thereto by like order.
/s/ Tortina M. Bunton
---------------------------------
(Signature of Notary Public)
My commission expires May 31, 2000
5
<PAGE>
CORPORATE RESOLUTIONS
At a Special meeting of the Board of Directors of the Meadow Valley
Corporation "Corporation"), duly called and held on the day of, September 1,
1998, a quorum being present, the following Preamble and Resolutions were
adopted:
"WHEREAS, the Corporation has a substantial, material and beneficial interest
in transactions in which MEADOW VALLEY CORPORATION AND ANY OF ITS PRESENT OR
FUTURE, DIRECTLY OR INDIRECTLY MAJORITY-OWNED OR CONTROLLED SUBSIDIARIES OR
AFFILIATES, WHETHER ALONE OR IN JOINT VENTURE WITH OTHERS NOT NAMED HEREIN; AND
ANY CORPORATION, PARTNERSHIP OR PERSON UPON THE WRITTEN REQUEST OF ANY OF THE
UNDERSIGNED (Hereinafter called the (individually and collectively hereinafter
called "Principal") has applied or will apply to Liberty Mutual Insurance
Company, LM Insurance Corporation, The First Liberty Insurance Corporation,
Liberty Mutual Fire Insurance Company, Liberty Insurance Corporation, and their
subsidiaries and affiliates, as the case may be (hereinafter called the
"Surety"), for certain bonds or undertakings of whatever kind or nature:
WHEREAS, the Surety has executed or is willing to consider the execution of
such bonds or undertakings, as surety, upon being furnished with the written
indemnity of the Corporation;
RESOLVED, that the officers authorized to execute documents on behalf of the
Corporation, be and they are hereby authorized and empowered to execute any
indemnity agreement or agreements required by the Surety as consideration for
the execution by it of bonds or undertakings of whatever kind or nature on
behalf of the Principal described in the agreement of indemnity required by the
Surety; and
RESOLVED FURTHER, that the said officers be and they are hereby authorized and
empowered, at any time prior or subsequent to the execution by the Surety of any
such bonds or undertakings, to execute any and all amendments to said indemnity
agreement or agreements; and to execute any other or further agreements relating
to any such bonds or undertakings or to any collateral that may have been
deposited with the Surety in connection therewith; and to take any and all
other actions that may be requested or required by the Surety, in connection
with any such bonds or undertakings; and
RESOLVED FURTHER, that the said officers be and they are hereby authorized and
empowered to affix the corporate seal to such indemnity agreement or agreements
and to any and all amendments to said indemnity agreement or agreements and to
any other or further agreements."
I, Julie L. Bergo, Secretary of the Corporation, have compared the foregoing
Preamble and Resolutions with the original thereof as recorded in the Minute
Book of the Corporation; and do certify that the same are correct and true
transcripts therefrom, and constitute the whole of said original Preamble and
Resolutions.
The officers authorized to execute documents on behalf of this Corporation are:
Bradley E. Larson
Kenneth D. Nelson
Gary W. Burnell
Given under my hand and the seal of the Corporation, in the City of Phoenix
State of Arizona this 1 day of September, 1998.
/s/ Julie L. Bergo
-------------------------------
Secretary
1
<PAGE>
EXHIBIT 10.93
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is entered into as of the 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 areas 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, any 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 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 EXPENSE 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 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: /s/ Scott Miller
- --------------------- --------------------------
Employee Chairman - Compensation Committee
7
<PAGE>
EXHIBIT 10.94
LEASE AND AGREEMENT
THIS AGREEMENT, made and entered into this 1st day of January, 1998, by and
between, Ken Nosker, HC6X Box 32, San Patricio, New Mexico 88348, (Lessor), and
Meadow Valley Contractors, Inc. (Lessee), 4411 S. 40th St. Phoenix, AZ 85040.
WHEREAS, Lessor has a valid ownership on certain lands hereinafter more
particularly described and identified: and,
WHEREAS, Lessee desires to obtain the right and privilege to enter into and upon
said lands for the purpose of quarrying and mining such rock materials as may be
found thereon, and crushing or otherwise processing said rock materials as
aggregate for commercial purposes.
NOW, THEREFORE, for and in consideration of sum of One and no/100 dollars
($1.00) and other good and valuable consideration of the agreements hereinafter
set forth, Lessor has demised, leased and let all of those certain lands and
property situated in Lincoln County, New Mexico, SE 1/4 of SW 1/4 & W 1/2 of SE
1/4 & SE 1/4 of SE 1/4, Sec 16 TWP 10S Range 15E, NMPM approximately 160 acres,
and including any and all right, title and interest of Lessor in and to any
and all rock materials and deposits thereof contained in said property, and all
rights-of-ways easements, together with the right to remove the same from the
said premises whether by Lessee or it's agents. Water will be made available at
existing wells by owner for $1.50 per MG. Meadow Valley Contractors, Inc. will
assume all power and pumping costs.
A $5,000.00 deposit for minimum royalty will be paid to the lessor by the lessee
at the beginning of each year as a minimum royalty payment. No additional
payments will be made until the extraction of materials exceed the $5,000.00
amount in royalty calculations based on materials weighed across certified
scales.
The Lessor retains the right to graze livestock, utilize pastures and existing
corrals within the property boundaries while not interfering with lessees active
operations. Lessee will not be liable for livestock under any circumstances.
TO HAVE AND TO HOLD unto said Lessee and to it's successors and assignees for a
term of 5(five) year with the option to renew for 5 (five) years.
And in consideration of such demise and of the considerations and royalty
hereinafter set forth and the covenants and agreements to be kept and performed,
it is hereby covenanted and agreed by the parties hereto, to wit:
1. That Lessee shall have and is hereby granted the sole right, license and
privilege to enter into and upon said property for the purpose of mining,
quarrying, crushing, blasting, processing, mixing aggregate and asphalt
cement in a hot plant, ready mix plant, and/or any other sand & gravel
plant, stockpiling and removing any other activities or processes
pertaining or incidental to these purposes for the period of 5 (five) years
with an option to renew for 5 (five) years.
1a. A mining plan will be established and agreed upon in writing before actual
mining commences. This does not include exploratory work necessary to
develop the plan. The plan shall be prepared to construction industry
standards including planned mining sequence, location of crushing and
processing plants, stockpiling areas and planned waste and stripping areas.
The mining plan may be changed at any time when agreed upon by both
parties.
<PAGE>
2. That Lessee is given the right of selling said materials, at such price and
in such manner as Lessee shall deem best, and transporting or causing said
materials to be transported from said lands.
3. In consideration, lessee agrees to pay lessor $1.00, for sole right to the
said property for a period of 5 (five) years, with the option to renew for
another 5 (five) years.
4. That Lessee agrees, during continuance of this Lease, to indemnify and save
harmless the Lessor from each and every loss, cost, damage and expense
arising out of any accident or other occurrence causing injury or death of
persons or damage to property caused by the activities of Lessee on the
leased premises. Lessee agrees to provide, pay for and maintain public
liability insurance in amounts of not less than One Million and no/100
dollars ($1,000,000.00) with respect to such bodily injury or death, and
not less than Fifty Thousand and no/100 Dollars ($50,000.00) with respect
to damage to the property of others, for the protection of Lessor and
Lessee against any liabilities or obligations and heretofore set forth.
5. Lessor warrants a valid ownership on the aforesaid lands and rock materials
hereby leased.
6. Lessee covenants and agrees to pay to Lessor at his address royalty
payments on all rock or other material removed from the premises, said
royalties to be as follows;
Royalty payments on aggregates removed @ $0.55 first 100,000/tn, $0.60 next
200,000/tn, $0.65 next 300,000/tn, $0.70 next 400,000/tn, $0.75 thereafter.
Deductions will be made for admixtures, eg. oil, cement, etc. All materials
will be weighted across certified scales.
6a. In the event recycled materials are brought to the premises and/or
aggregates are utilized, these will be paid for at 25% of the royalty rate
at the time or removal or at a method agreed upon by both parties.
6b. Lessee shall be responsible for any and all permits, applicable gross
taxes, processing taxes, and severance taxes applicable to its operations.
6c. Imported construction wastes will be for recycling and not for permanent
storage. No hazardous wastes will be left on leased premises.
6d. Opportunities to utilize pit run, or processed materials by the immediate
family of lessor will be provided for in the form of a +/- 10% discount off
of retail prices established. This will be a single pass through with bid
jobs by lessee being excluded.
7. It is further understood that the cash royalties payable on materials
removed from the premises shall be due and payable within fifteen (15) days
after the end of the month for any and all materials used during the
previous month as paid for by the owner.
8. If Lessee shall fail, refuse, or neglect to carry out any of the terms or
provisions of this Lease and Agreement, and if the same be not corrected
within fifteen (15) days of mailing or written notice thereof, then Lessor
may terminate this Lease immediately and be entitled to the rights of
Lessor.
9. Lessee agrees to remove or properly dispose of all trash, unused items or
discarded materials and to return the property to Lessor in a neat and
clean condition. Any and all processed materials remaining on the premises
one year after the termination of this agreement shall become the exclusive
property of Lessor.
<PAGE>
9a. Lessee shall provide an environmental assessment, archaeological
assessment, and a "quarry" reasonable reclamation plan for a quarry
operation. Efforts will be made to delineate and preserve historical
landmarks, e.g. corrals, buildings, foundations, wellsites, etc. Any change
to fences, corrals, water works or wellsites shall be repaired or subject
to compensation. Damage to underground wells from blasting will not be a
consideration unless negligence can be proven. In the event an
environmental, archaeological, zoning, or other unforseen restraint
prevents the site from being utilized as a quarry, the lease agreement
shall be considered null and void and both the lesee and lessor shall be
held harmless.
9b. Oversize boulders generated from blasting may be used to delineate
preservation areas or grouped together in a waste area.
9c. Lessee retains the right to remove produced materials for a period of one
year after the termination of the lease. Royalties must be paid on these
materials as they are removed.
10. The effective date of this agreement shall be , and the terms shall
start as of that date.
11. This Lease may not be sublet or assigned in whole or in part without the
written consent of the Lessor having been obtained.
12. Notices or other communications address to the Lessor shall be at HC6X Box
32, San Patricio, New Mexico 88348.
13. Notices or other communications addressed to the Lessee shall be at P.O.
Box 60726, Phoenix, AZ.85082.
14. Lessee would have no objections to any gas or oil exploration which would
not interfere with the lessee's operations of the quarry or the lessee's
business. Assayable minerals will be retained by the lessor.
<PAGE>
IN WITNESS WHEREOF, of the parties hereto have executed this Lease and Agreement
this day of
LESSEE:
MEADOW VALLEY CONTRACTORS
By: /s/ Samuel J. Grasmick
--------------------------
STATE OF Arizona )
)ss.
COUNTY OF Maricopa )
The foregoing instrument was acknowledge before me this 5 day of January
by: Samuel J. Grasmick.
------------------
Notary Public /s/ Arminda Palacio
---------------------------
My Commission expires: 6-17-2001
------------------
IN WITNESS WHEREOF, of the parties hereto have executed this Lease Agreement
this day of
LESSOR:
KEN NOSKER
By: /s/ Ken Nosker
---------------------
STATE OF New Mexico )
)ss.
COUNTY OF Lincoln )
The foregoing instrument was acknowledged before me this 30 day of
December by Ken Nosker.
----------
Notary Public /s/ [SIGNATURE
---------------------------
My commission expires 11-20-99
-------------------
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<FISCAL-YEAR-END> DEC-31-1998 DEC-31-1997
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3,601 3,601
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