HomeMy WebLinkAbout9.B. Consider granting Challenge Printing, Inc. a MN Investment Fund Loan-Res. No. 6099
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CITY OF SHAKOPEE
Memorandum
TO: Mayor and City Council
FROM: Paul Snook, Economic Development coordinato~
SUBJECT: Public hearing regarding Minnesota Investment Fund application
and related Business Subsidy Agreement for Challenge Printing,
Inc.
Resolution No. 6099, Authorizing application to the Minnesota
Department of Employment and Economic Development(DEED)
for the Minnesota Investment Fund for Challenge Printing, mc.
MEETING DATE: August 17,2004
Introduction & Background
City Council is asked to adopt Resolution 6099, authorizing application to the Minnesota
Department of Employment and Economic Development (DEED) for the Minnesota
mvestment Fund for Challenge Printing, mc.
At the July 6, 2004 meeting Council unanimously approved TIF contract with Challenge
Printing. Another element of the project financing is to attain a Minnesota Investment
Fund loan from DEED to assist in financing new equipment, an 81 inch press (according
to Challenge senior management, the first and largest press of its kind in North America).
In 2002, the City applied to DEED for a $440,000 MIF loan for the CertainTeed
expansion project, however, the company opted for an alternate funding source. When
that happened, staff was able to negotiate with DEED to retain/reserve the $440,000 in
MIF funds for a future project in Shakopee, which has turned out to be the Challenge
Printing expansion.
Staff and company representatives have completed the Minnesota Investment Fund
Application (attached) for which the City must pass a resolution to finalize the
processing ofthe application and to receive a grant upon approval by DEED.
DEED staff is of the opinion that the Minnesota Investment Fund would be a good fit
with Challenge Printing's expansion project; MIF is a grant to the. City and a loan to the
company. An additional benefit to the City of using the MIF program is that it presents
the City the opportunity to establish an economic development revolving loan fund;
$100,000 of the MIFprogram for Challenge would be paid back to the City to establish
the revolving loan fund.
mif - challenge-ph memo 8-17 -04.doc
The revolving loan fund would be used specifically for businesses within the "basic"
sector of the local economy; manufacturing, assembling, or processing operations,
including new technology-based businesses, that are primarily dependent upon external
markets, exporting their products. Basic sector activity is the true generator of economic
expansion in a community. Non-basic sector businesses such as retail and services (which
depend largely upon local markets), and whose products are consumed locally will not be
eligible.
The Minnesota mvestment Fund application process requires that a public hearing be held
to provide citizen notification and involvement prior to submitting the application. The
action at the August 1 ih meeting will be to open the public hearing and continue the
hearing to the October 5, 2004 meeting. The meeting needs to be continued because the
Loan Agreement will be presented at that time, and within the Loan Agreement will be
the Business Subsidy Agreement, which requires a public hearing. The reason for the lag
time in the public hearing is that DEED needs the application now in order to continue to
reserve the funds for Shakopee (rather than provide the funds to another community), but
due to scheduling circumstances, DEED will not have the Loan Agreement (with the
Business Subsidy Agreement) drafted and ready until the October meeting. So, rather
than having two public hearings (and attendant published notices, etc.), it would be more
efficient to continue the August 1 ih hearing to October 5th.
Budget Impact
A successful application will add $100,000 to establish an economic development
revolving loan fund. In addition, for the 2005 budget, staff will be proposing that an
additional $100,000 be used from the EDA reserve fund for the ED revolving loan fund;
the $100,000 MIF payback to the City plus $100,000 from the EDA reserve would total
$200,000 for the ED revolving loan fund.
Action Requested
Offer Resolution 6099, authorizing application to the Minnesota Department of
Employment and Economic Development (DEED) for the Minnesota mvestment Fund
for Challenge Printing, Inc., and move its adoption.
Continue the public hearing to October 5, 2004.
mif - challenge ph memo 8-17-04.doc
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RESOLUTION NO.
A RESOLUTION OF THE CITY OF SHAKOPEE
AUTHORIZING APPLICATION TO THE MINNESOTA DEPARTMENT OF
EMPLOYMENT AND ECONOMIC DEVELOPMENT FOR THE MINNESOTA
INVESTMENT FUND FOR CHALLENGE PRINTING, INC.
WHEREAS, the City of Shakopee has reviewed Challenge Printing's
proposed expansion of its manufacturing facility and request for assistance; and
WHEREAS, the City has previously submitted a Part I Application for the
Minnesota Investment Fund and now wishes to submit a Part II Application.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF SHAKOPEE, MINNESOTA AS FOLLOWS:
1. That the City of Shakopee act as the legal sponsor for the project contained
in the Business and Community Development Application to be submitted on
August 18, 2004, and that the City Administrator is hereby authorized to
apply to the Department of Employment and Economic Development, for
funding of this project on behalf of the City of Shakopee
2. That the City of Shakopee has not incurred any costs and has not entered
into any written agreements for purchase of property for the proposed
project.
3. That the City of Shakopee has not violated any Federal, State, or local laws
pertaining to fraud, bribery, kickbacks, collusion, conflict of interest or other
unlawful or corrupt practice.
4. That upon approval of its application by the Department of Employment and
Economic Development on behalf of the State of Minnesota, the City of
Shakopee may enter into an agreement with the State of Minnesota for the
above-referenced project, and that the City of Shakopee certifies that it will
comply with all applicable laws and regulations as stated in all contract
agreements and described on the Compliance Section of the Business and
Community Development Application.
5. As applicable, that the City of Shakopee has obtained credit reports and
credit information from Challenge Printing, Inc. Upon review by the City of
Shakopee and its legal counsel, no adverse findings or concerns regarding,
but not limited to, tax liens, judgments, court actions, and filings with state,
federal and other regulatory agencies were identified. Failure to disclose any
such adverse information could result in revocation or other legal action.
6. That the City Administrator is hereby authorized to execute such
agreements, and amendments thereto, as are necessary to implement the
project on behalf of the City of Shakopee.
Adopted in session of the City Council of Shakopee,
Minnesota, held this day of , 2002.
Mayor of the City of Shakopee
City Administrator
ATTEST:
City Clerk
PREPARED BY:
City of Shakopee
129 South Holmes Street
Shakopee, MN 55379
RESOLUTION NO. 6099
A RESOLUTION OF THE CITY OF SHAKOPEE
AUTHORIZING APPLICATION TO THE MINNESOTA DEPARTMENT OF
EMPLOYMENT AND ECONOMIC DEVELOPMENT FOR THE MINNESOTA
INVESTMENT FUND FOR CHALLENGE PRINTING, INC.
WHEREAS, the City of Shakopee has reviewed Challenge Printing's
proposed expansion of its manufacturing facility and request for assistance; and
WHEREAS, the City has previously submitted a Part I Application for the
Minnesota Investment Fund and now wishes to submit a Part" Application.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF SHAKOPEE, MINNESOTA AS FOLLOWS:
1. That the City of Shakopee act as the legal sponsor for the project contained
in the Business and Community Development Application to be submitted on
August 18, 2004, and that the City Administrator is hereby authorized to
apply to the Department of Employment and Economic Development, for
funding of this project on behalf of the City of Shakopee
2. That the City of Shakopee has not incurred any costs and has not entered
into any written agreements for purchase of property for the proposed
project.
3. That the City of Shakopee has not violated any Federal, State, or local laws
pertaining to fraud, bribery, kickbacks, collusion, conflict of interest or other
unlawful or corrupt practice.
4. That upon approval of its application by the Department of Employment and
Economic Development on behalf of the State of Minnesota, the City of
Shakopee may enter into an agreement with the State of Minnesota for the
above-referenced project, and that the City of Shakopee certifies that it will
comply with all applicable laws and regulations as stated in all contract
agreements and described on the Compliance Section of the Business and
Community Development Application.
5. As applicable, that the City of Shakopee has obtained credit reports and
credit information from Challenge Printing, Inc. Upon review by the City of
Shakopee and its legal counsel, no adverse findings or concerns regarding,
but not limited to, tax liens, judgments, court actions, and filings with state,
federal and other regulatory agencies were identified. Failure to disclose any
such adverse information could result in revocation or other legal action.
6. That the City Administrator is hereby authorized to execute such
agreements, and amendments thereto, as are necessary to implement the
project on behalf of the City of Shakopee.
Adopted in session of the City Council of Shakopee,
Minnesota, held this day of ,2004.
Mayor of the City of Shakopee
ATTEST:
City Clerk
PREPARED BY:
City of Shakopee
129 South Holmes Street
Shakopee, MN 55379
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Develonment
Business & Community
Development
Minnesota Investment Fund Application
STATE FORM
Please submit one copy of the application to:
Minnesota Department of Trade and Economic Development
Business and Community Development Division
500 Metro Square
121 East 7th Place
Saint Paul MN 55101-2146
651/296-5005
1-800-657 -3858
TTY{fDD: 651-297-5353
Fax: 651-296-5287
CITY INFORMATION
1. City Name: City of Shakopee
Contact Person: Paul Snook, Economic Development Coordinator
Address: 129 Holmes St. S.
City/State/Zip: Shakopee, MN 55379
County: Scott
Phone: (952) 496-9661 FAX: (952) 233-3801
2. Financial Officer: Gregg Voxland
Address: 129 Holmes St. S.
City/State/Zip: Shakopee, MN 55379
Phone: (952) 233-3800 FAX: (952) 233-3801
3. Minnesota Tax Identification Number: 8025237
Federal Employer Identification Number: 41-6005539
4. Legislative District for Project Area: District 35
Name of State Representative: Michael Beard
Name of State Senator: Claire Robling
5. Does the City have a Revolving Loan Fund? Yes - NoX
If yes, what is present account balance? N/A
6. Submit a copy of the municipality's revolving loan policies and procedures.
7. Application Author: Paul Snook, Econ. Dev. Coordinator Phone: (952) 496-9661
COMMUNITY NEED NARRATIVE
The Community will be evaluated based on the following criteria. Describe those that apply
and any other pertinent issues:
Economic vulnerability of the City of Shakopee, Twin Cities Metropolitan Area and State
of Minnesota; retention of existing business/industry and attendant jobs; high vacancy
rate of industrial property.
Challenge Printing is relocating its operations to a new manufacturing, office and storage
facility to be an expansion of an existing manufacturing facility, formerly owned and occupied
by ADC Telecommunications at 1000 Valley Park Drive in Shakopee, Minnesota. This facility
has been vacant for two years.
Challenge Printing's need for the expansion stems from a growing business being located in
multiple facilities in Eden Prairie with an inability to expand in any ofthose facilities.
Challenge needs to relocate to the larger former ADC facility, expand it and acquire significant
additional/new equipment. The City has entered into a "pay-as-you-go" TIF arrangement with
Challenge for approximately $500,000, and with this application is applying for the Minnesota
Investment Fund to augment the tax increment and company financing.
The existing building has been vacant since August of 2002. No other use of the property has
been proposed. While it is possible for the property to be purchased by another user as is, there is
no reasonable expectation that another user would expand the facility as proposed by Challenge
Printing. It is likely that another buyer would simply acquire the property and make minor
improvements, if any. Also, any proposal to expand the facility would likely require assistance
(tax increment fmancing and Minnesota Investment Fund) similar to that requested by Challenge.
Therefore, the City reasonably believes that, without public assistance, little or no market value
increase is expected for this property. It is likely that no alternative would occur that would
produce a market value increase greater than the estimated $5,621,400. The project will retain
approximately 380 existing jobs in the State and create 80 new jobs, plus create substantial new
tax base for the City and the State.
Tax increment and Minnesota Investment Fund financing is needed to induce Challenge
Printing, mc. to relocate its operations to the City, thus preserving and enhancing job and tax
base growth for the City, County and the State as a whole. Absent tax increment and MIF, the
expansion would likely occur in another state or outside the United States.
Need to diversify the local industrial base
This project is in the interest ofthe City in that it is an attraction and expansion of a new
manufacturing business. The attraction and expansion of Challenge Printing will contribute to
the stability of the local economy since it would be a significant entity in the basic sector (that
is, it is a manufacturer and exporter to regions beyond Shakopee, bringing new money into the
local economy). The project will result in further diversification of the local economy and
significant expansion ofthe local employment base.
GENERAL PROJECT INFORMATION
1. A public hearing is required to provide citizen notification and involvement prior to
submitting the application. Submit a copy of the public hearing minutes, a copy of the
public notice and affidavit of publication, and the Local Government Resolution.
(SEE ATTACHMENT)
2. Will the proposed project create increased costs for business and residents?
Yes_ N06
If yes, describe how all the affected parties have been informed of the increased costs.
3. Will the project result in the loss or diminution of wetlands? Yes_ NoX
If yes, describe the measures which will be taken to mitigate all functional values of the
wetlands that will be lost or diminished.
4. Will the proposed project be located in a flood plain? Yes_ N06
If yes, is flood insurance required?
5. Have state environmental review requirements been met, if applicable?
Yes No (NOT APPLICABLE)
6. Provide a letter from the county/city assessor that provides the following information:
- current assessed valuation (SEE ATTACHMENT)
_ current real estate taxes payable
_ projected assessed valuation
_ projected real estate taxes payable
NOTICE OF PUBLIC HEARING
Notice is hereby given that the City Council of the City of Shako pee, Minnesota will meet at
7:00 p.m. on Tuesday, August 17, 2004 at City Hall, 129 Holmes Street, Shakopee, Minnesota
55379-1376, to conduct a hearing regarding granting Challenge Printing, Inc. a Minnesota
Investment Fund loan under Minnesota Statutes, Section 116J.8731 for certain property in the City
of Shakopee located at 1000 Valley Park Drive (referred to as the "Property").
At the hearing, the City Council will consider granting Challenge Printing, mc. a Minnesota
Investment Fund loan.
The proposed loan constitutes a "business subsidy" under Minnesota Statutes, Section
116J.993 to 116J.995.mformation concerning the proposed project, including a summary of the
terms of the business subsidy agreement, will be on file at City Hall on and after the date of this
notice. Any person wishing to express an opinion on the matters to be considered at the public
hearing will be heard orally or in writing.
Dated: [Date of Publication ]
/s/
City Clerk
251227 (JAE)
SH235-16
LOCAL GOVERNMENT RESOLUTION ECONOMIC DEVELOPMENT PROGRAM
Applicants must adopt and submit the following resolution. This resolution must be adopted prior to
submission of the forms package.
BE IT RESOLVED that (Applicant) act as the legal sponsor for
project(s) contained in the Business and Community Development Application to be submitted on
and that (Title of First Authorized Official) and
(Title of Second Authorized Official) are hereby authorized to apply to
the Department of Trade and Economic Development for funding of this project on behalf of
(Applicant).
BE IT FURTHER RESOLVED that (Applicant) has the legal authority
to apply for financial assistance, and the institutional, managerial, and financial capability to ensure
adequate construction, operation, maintenance and replacement of the proposed project for its design life.
BE IT FURTHER RESOLVED that (Applicant) has not incurred any
costs and has not entered into any written agreements to purchase property.
BE IT FURTHER RESOLVED that (Applicant) has not violated any
Federal, State, or local laws pertaining to fraud, bribery, kickbacks, collusion, conflict of interest or other
unlawful or corrupt practice.
BE IT FURTHER RESOLVED that upon approval of its application by the
state, , (Applicant) may enter into an agreement with the State of Minnesota for
the above-referenced project(s), and that (Applicant) certifies that it will
comply with all applicable laws and regulations as stated in all contract agreements and described on the
Compliance Section (page 7) of the Business and Community Development Application.
AS APPLICABLE, BE IT FURTHER RESOLVED that (Applicant) has
obtained credit reports and credit information from
(Name of Company) and (Name of Owners). Upon
review by (Applicant) and
(Applicant's Legal Counsel), no adverse findings or concerns regarding, but not limited to, tax liens,
judgements, court actions, and filings with state, federal and other regulatory agencies were identified.
Failure to disclose any such adverse information could result in revocation or other legal action.
NOW, THEREfORE BE IT RESOLVED that (Title of First
Authorized Official) and (Second Authorized Official), or their
successors in office, are hereby authorized to execute such agreements, and amendments thereto,
as are necessary to implement the project(s) on behalf of the applicant.
I CERTIFY THAT the above resolution was adopted by the City Council of the City of Shakopee on
(Date).
SIGNED: WITNESSED:
(First Authorized Official) (Signature)
(Title) (Date) (Title) (Date)
. Message Page I of2
Paul Snook
From: Dorfha Vang [DVang@springsted.com]
Sent: Thursday I July 29, 2004 9:45 AM
To: 'PS nook@ci.shakopee.mn.us'
Cc: Paul Steinman
Subject: FW: Value / Tax Info on Challenge
Mr. Snook:
- current assessed valuation
2004 valuation $7,375,000
- current real estate taxes payable -
Taxes payable 2004 - $251,516
- projected assessed valuation -
Base $7,375,000
Projected Increase. 5,621.400
$12,996,400
_ projected real estate taxes payable
Projected taxes payable - $444,171
Please call if you have any questions. Thank you.
Dorfha Vang, Associate Analyst
Springsted Incorporated
Phone: 651-223-3019
Fax: 651-223-3002
dvang@springsted.com
-----Original Message-----
From: Paul Snook [mailto:PSnook@ci.shakopee.mn.us]
Sent: Wednesday, July 28,2004 12:45 PM
To: Paul Steinman (E-mail)
Subject: Value / Tax Info on Challenge
Paul-
The following info is needed in the MIF application...
- current assessed valuation -
_ current real estate taxes payable -
_ projected assessed valuation
_ projected real estate taxes payable
Message Page 2 of2
... can this be attained from the TIF run you did??
Thanks
- Paul
Paul C. Snook
Economic Development Coordinator
City of Shakopee
129 Holmes St. S.
Shakopee,NUN 55379
Phone (952) 496-9661
Fax (952) 233-3801
Property Search Results Page I of3
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Scott County Property Information Search Results
General Property Information
Property ID: 27-154001-0
Roll Type: Rea I Estate
Payable Year: 2004
Owner Name: 1000 VALLEY DRIVE LLC
Attn: 0/0 PROPERTY TAX ADVISORS
Property Address: 1000 VALLEY PARK DR
City /State/Zi p: SHAKOPEE MN 55379
Taxpayer Name: 1000 VALLEY DRIVE LLC
Attn: 0/0 PROPERTY TAX ADVISORS
Taxpayer Mailing Address:
House Address:
PO Box: PO BOX 19156
City/State/Zip: ALEXANDRIA VA 22320
Legal Description Information
Lot/Block/Plat# : 1 1 27154
Plat Name: PLAT-27154 VALLEY PARK 9TH ADDN
Section/Townshi p/Range:
Deeded Acres: 29.12
Legal Description: SECT- TWP- RNG- EX W 221 OF S 743.31
Miscellaneous Information
Property Search Results Page 2 of3
School District: 720
Taxing District Code: 2204
Taxing District Name: SHAKOPEE CITY
Valuation & Tax Information
(The tax figure shown mayor may not be calculated on the
total estimated market value as shown. Programs such as This
Old House, plat deferment, limited market value and green
acres may reduce the indicated market value to a taxable
market value upon which taxes would be calculated.)
Estimated Market Value of Land: $1,892,800
Estimated Market Value of Building: $5,482,200
Estimated Market Value Total: $7,375,000
Total Net Taxes for Current Year: $251,516.00
Total Special Assessments Due for $0.00
Current Tax Year:
Total Net Tax plus Special Assessments: $251,516.00
Outstanding Special Assessments: $0.00
Payments: $125,758.00
Green Acres:
Ag Preserve:
Tax Classifications
property Type: PREF INDUSTRIAL
Homestead Status: N
Exempt Status:
Sales Information
Last Qualified Sale: 07/15/2004
Amount: $1,150,000.00
Property Search Results Page 3 of3
Building Characterstics
Type: IND/WRHSE
Year Built: 1990
Architectural Style: N/A
Foundation Size (Sq Ft): 310,199
Garage Size (Sq Ft): 0
Frame: STEELS
Bedrooms: 0
Bathrooms: 10.00
Main Menu I Property ID Search I Property Address Search
Owner Name Search I Legal Descri.Qtion Search I
CRV Search I Property Tax Estimator
Property Tax Statement
BUSINESS CREDIT CHECK (SEE ATTACHMENT)
Applicants for business assistance are required to obtain credit reports and credit references,
both on the business and owners holding 20% or more of the business. Some or all of the
items described in #1-6 may be assessed to determine credit worthiness. This review is
required prior to passing the Local Government Resolution (page 6).
1. Obtain a credit status report from the applicant's bank on the business
requesting assistance.
2. Conduct a name search with the County Recorder's office (and/or Registrar of
Deeds) where the business is presently located to identify any filings of pUblic
record against the business. It may be necessary to go to several surrounding
counties depending on the information received. For the majority stockholders,
a name search should be undertaken in the counties where the individual's
reside (or have resided in the past). Individuals providing personal guarantees
are generally the majority stockholders owning 20% or more of the company.
The County Recorder's records will identify liens which may include:
A. Federal tax liens
B. State tax liens
C. Judgements
D. Real estate liens
3. Conduct a lien search with the Secretary of State.
4. Conduct a name search with the Criminal Clerk of Court in the County where
the business is located and where the majority stockholders reside (or have
resided in the past). The Criminal Clerk of Court will identify court actions taken
in regard to the business and stockholder(s). Conduct a name search in the
Civil Clerk of Court to identify any pending action against the company or
stockholder( s).
5. To determine if there is a pending lawsuit, conduct a name search of the
business and the majority stockholder(s) through the U.S. District Court. St.
Paul: 651-848-1100
Minneapolis: 612-664-5000
Duluth: 218-529-3500
6. Contact "local" bankruptcy court to determine if the business or owners have
filed for bankruptcy protection. Web site: www.mnb.uscourts.qOV 1-800-959-
9002.
7. Applicants are also encouraged to complete the following credit checks:
a. Obtain a Dunn and Bradstreet report on the business requesting assistance.
b. Obtain supplemental reports (letters and telephone calls to credit
references) when other channels of information do not clearly indicate the
credit history of the business.
85 E. SEVENTH PLACE, SUITE 100
SAINT PAUL, MN 55101-2887
651-223-3000 FAX: 651-223-3002 SPRINGSTED
# .1d.-isors co rh" Pl10iic Secto!"
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MEMORANDUM
TO: Paul Snook, City of Shakopee
FROM: Paul Steinman, Springsted
DATE: June 29, 2004
SUBJECT: CONFIDENTIAL - NOT FOR PUBLIC DISTRIBUTION
Dun & Bradstreet (O&B) Report on Challenge Printing
As part of our arrangement when we purchase reports, Dun & Bradstreet does not allow their
copying and re-distribution. Therefore, I will aggregate the data contained in the Challenge
Printing report in a summary format herein.
Summary
1) The Financial Stress Class of 1 for this company shows that during the previous year,
firms of this type had a failure rate of .49% (49 per 10,000), which is lower than the
national average.
2) The Credit Score Class of 2 for this company shows that during the previous year, 4.7%
of the firms with this classification paid one or more bills severely delinquent, which is
lower than the national average.
3) Challenge Printing pays its bills an average 2 days beyond terms.
4) Challenge Printing's industry pays its bills an average 8 days beyond terms.
5) Challenge printing pays its bills more promptly than the average for its industry.
6) Financial information form a fiscal statement dated 12/31/03 is included in the D&B
report.
7) Net worth for the fiscal year ending December 2003 is up by 29.1 %.
8) UCC filings are reported for Challenge Printing.
9) Challenge Printing has been under present management control for 16 years.
10) No record of open suits, liens, or judgments in the D&B database.
Please let me know if you have any further questions about the D&B report.
CORPORATE OFFfCE: SAINT PAUL, MN . Visit our website at www.springsted.com
IOWA . KANSAS . MINNESOTA . VIRGINIA . W ASHJNGTON, DC . WISCONSIN
08/03/2004 09:12 FAX 6512233002 SPRINGSTED INC. lllo02
Business Crew.: Snapshot - Printable Snapshot Report Page 1 of2
I' I Close winda N
exper Ian
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Order number. 1091474156138 Index: _
Report date: August 2,2004 - G/J~f1enge Pd.r.rti.ug~F:!e~Qg!'AAhit;; s.p,e.c .. · :
- ~MII<!ng..e Printing fne
Challenge Printing Ffexographic Spec Snapshot rating - Caution -
7500 Golden Triangle Experian JO number: S15653105
Eden Prairie. 1\ IN 55344 In Experian databasE! since: April 1989
Phone:: 952-90:14400
Summary:
Based on the CI ment payment performance and legal records on fife. Experian suggests further investigation of
this company pi ior to making any credit or business decisions. Key elements on the Experian database that leat]
to this category include paying creditors on average 2 days past the invoice due date . and a collection filing of
$4.045.
Detailed l..egaJ Filings:
No legal filings are currently on file.
Detailed Collec tion Filings:
· An acco Jnt was pieced for collection against Challenge Printing Flexographic Spec on February 2004.
This ace :>unt was placed with Newton Associates for the amount of $4045.
Oetailed Paymllnt Behavior:
. There are a total of 29 supplier relationships reported to Experian within the last 18 month15. The total
recent high credit for these 29 trade relationships is $388,400. with the hlghest single credit being for
$169.70IJ. The total current balance owed on the 29 trade relationship is $95.800, with the highest single
balance :Iue of $70,200. The aecount 15tiltus for the total 595,800 balance due is: 93% current. 4% 1wto-
30 days :last due, 3% 31-to-60 days past due. The average days past the invoice due date that it takes
ChaJlense Printing Flexographlc Spec to pey their balances is 2 days.
Payment Trend Sehavior:
. II I
1 8 1 7
Feb 2004 M:lr 2004
ThiS grapn illuGtratel: the payment performance or CheUenge Printing t:JlllCograptlic Spec compared with industry average$.
The blue bars (lne 111\ ~ide for each month) show the average number of days OOyond the invoice due C1atQ that Ctlallenge Printing
Flexographlc Spec ~ aid Its bills during tile past Six mcnths.
The red bars (the right side for each month) ~how the same information for the Indurotry as a whOle.
Financial Servlc es History:
https:/lwww.expc;rian.comlb2breportsISSReportAction.do 812/2004
08/03/2004 09:13 FAX 6512233002 SPRINGSTED INC. I4J 003
Business Credi: Snapshot - Printable Snapshot Report Page 2 of2
· enaller 9& Printing Flexographic Spec has a merchant bank card with Undisclosed
Comp,ny His! ory:
Challenge Prin:ing FlexQgraphlc Spec is Oil Corporation primarily in the Commercial Printing, Nee business. The y
were incorpora ted in Minnesota. The Minnesota state charter number of the business is 0005 .895. Principal
offieel'$ of the (ompany include Jay Carroll , , and Robert Lothenbach . Owner. They currently have 300
employees anc sales of $7,500,000
return to 101' >>
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Challange Printing Inc Snapshot rating - Limited
7500 Golden Triangle Dr . Experian 10 number: 810542888
Eden Prairie, fllN 55344 In Experian database since: July 1991
Summary:
Due to limited amount of data currently on Experian's database for Challange Printing Ine , Experian eannot
provide a Snap:;hot risk category.
Detailed Legal Filings:
No legal filin9~ are currently On file.
~
Detailed Paym'Jnt Behavior:
· There ale a total of 5 supplier relationships reported to Experian within the last 18 months. The total
recent h gh credit for these 5 trade relationShips is $46.600. with the highest single credit being for
$46.400 The total current balance owed 01'1 the 5 trade relationship is $8,800. with the highest single
balance tlue of 56,400. ihe account status for the total $6.600 balance due is: 36% eurrent, 38% 1-10-30
days paRdue, 20% 31-to-60 days past due6% 91+ days past due. The aVlIilrage days past 1I1e invoice
due date that it takes Challange Printing Ine to pay their balances is 21 days.
Company Histuy:
Challange Printi 19 Inc is primarny in the Commercial Printing. Nee business. They have been active in Experian
credit files since July 1991.
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experian and the :xperian marks herein are service marks or registered trademarks Or Experian.
https:/lwww.experian.comlb2brepol1s/SSReportAetion.do 8'212004
PROJECT COMPLIANCE
1. Section 504 of the Federal Rehabilitation Act of 1973; the Americans with Disabilities Act (ADA), MN
Statutes 1990, Chapter 363, Chapter 363 MN Human Rights Act - Require that all public facilities and
programs be designed and constructed to be accessible to the physically handicapped.
2. Title VI of the Civil Rights Act of 1964 (P.L. 88-352) and subsequent regulations - It ensures access to
facilities or programs regardless of race, color, national origin or sex.
3. Executive Order 11246, as amended by Executive Orders 11375 and 12086 and subsequent regulations -
prohibit employment discrimination on the basis of race, color, religion, sex or national origin.
4. Executive Orders 11988 and 12148, Floodplain Management - Requires action to minimize the impact of
floods on assisted projects.
5. The Flood Insurance Purchase Requirements of Section 102a of the flood Disaster Protection Act of 1973,
(P.L. 93-234) - Requires the purchase of flood insurance in communities where such insurance is available
for construction or acquisition projects in any area having special flood hazards.
6. Minnesota Statutes, Section 116J.871 applies to this project. This statute requires of recipients of state
assistance to pay the prevailing wage rate to laborers and mechanics at the project construction site when
state funds are provided for construction in the amount of $200,000 or more.
7. Title VIII of the Civil Rights Act of 1968, as amended and executive order 12259 - Requires equal
opportunity in housing and non-discrimination in the sale or rental of housing and actions to affirmatively
further fair housing.
8. Age Discrimination Act of 1975 - Prohibits discrimination on the basis of age.
9. Minnesota Statutes Sections 471.87 and 471.88 - Forbids public officials from engaging in activities' which
are, or have the appearance of being, in conflict of interest.
10. Antitrust or unfair trade practices laws - Regulates and controls the sale of goods and services and prohibits
deceptive and unfair competition between businesses.
11. Executive Order 12549, Debarment and Suspension (43 CAR, Part 12 and Section 12.510) - Requires a
certification regarding Federal debarment, suspension and other responsibility matters.
12. Minnesota Statutes 290.9705 - Requires that 8 percent of each payment paid to out-of-state contractors for
work in Minnesota must be withheld on any contracts that exceeds or could reasonably be expected to
exceed $100,000, unless the requirement is waived.
13. Minnesota Statutes 116J.991 applies to this project. This statute requires that a business receiving state
assistance for economic development or job growth purposes must create a net increase in jobs in
Minnesota within two years of receiving the assistance.
14. Minnesota Statutes, 116J.8731, Minnesota Investment Fund applies to this project.
15. Minnesota Investment Fund Rules Chapter 4300.
Certifies compliance as so stated in the
Signature of Applicant "Local Government Resolution"
COMPANY PROJECT NARRATIVE
Description should include but not be limited to:
a. Company History: Challenge Printing was founded in 1988 by Robert J. Lothenbach with $2,000
and a vision of what was possible. Today, Challenge Printing is a $70 million full service sheetfed printer
with three locations in Eden Prairie, MN, over 20 presses and almost 400 employees with an average annual
wage of $50,000 excluding benefits. Challenge Printing's annual sales growth over the past 16 years has
averaged an impressive 41 % and the company is a true market leader in the printing industry. CPI has five
core businesses: sheetfed, point of purchase, flexography, UV and packaging printing. This diversification
strategy has afforded the company the opportunity to grow and flourish in what has been one of the most
difficult three+ years in the printing industry. The owner has invested in excess of $32 million in equipment
in the past five years and it truly is a state of the art operation. CPI serves small to large customers that
includes hallmark customers such as Target, Dairy Queen, Kohl's JCPenney's, General Mills, West Group
and Lifetouch to name a few.
b. Detailed description of proposed project: CPI is ready to embark on a new chapter in our Company's
history. As a result of CPl's growth and our inability to expand any of our current three facilities, we have
purchased a large building in Shakopee at 1000 Valley Park Drive and we are undergoing a relocation plan
that will move all three current locations to Shakopee. This is a massive undertaking that includes the
purchase of the new building, expanding the building from it's current size of 319,000 sq. ft. to 393,000 sq. ft,
relocating all current equipment at a cost in excess $4M, relocating all employees and the purchase of
approximately $12M of additional equipment. Once the move is complete, the expansion is done and all
the new equipment is installed, CPI will have invested close to $35M in this entire project. All of this will be
complete no later than 12/31/04.
CPI is taking delivery of a brand new first ever 81" KBA sheetfed press and will be the first one's in North
America to have such a press. We have already garnered our fair share of favorable press with regards
this press and the underlying market opportunities it will provide CPI and our customers. The press and
auxiliary equipment will cost close to $7M. Another piece of equipment we are buying is a VLF (Very Large
Format) Platesetter from Creo at a cost of $599,591. This piece of equipment will allow CPI to make very
large plates for the new 81" press. As discussed later in this document, thi~ is the piece of equipment we
will be using our loan from MIF to purchase.
c. What are the market opportunities that will result from the expansion or start-up? The ability to print
on substrates that are 81"x59" will open up a huge market for CPI. If our predictions are correct we will be
able to attract bigger, better and more expensive "Point of Purchase" products from the retail type section on
a nationwide basis. Retailers are always looking to advertise and promote their products through the use
of "signage" in their windows, posted in their aisles or hanging from their ceilings. Statistics have proven
that the bigger the sign the more product they move. CPI feels that the 81" market will eventually be our
fastest growing segment of our business.
d. What are your competitive advantages? CPI has many competitive advantages that makes us a
successful company. A few of these would be diversification or one stop shopping for the customer, ability
to print on a wide variety of substrates, ability to deliver a very high quality product fast, ability to handle very
large jobs that require a ton of working space that we had a very hard timing doing in our existing locations
and the financial capability to support our growth.
S-8
e. Identify existing building size and proposed square footage. We currently have three buildings with
a total sq. footage of 238,000 and will end up in the new building, including the expansion, with 393,381
square feet. This is an increase of 65%.
f. Discuss status of any land acquisition. N/A. The new building purchase sites on 30 acres of land
and ;s expandable to a total sq. ft. of 650,000 which will probably not be needed for at least another five to
eight years. Thus we do not need to purchase any additional land.
S-9
COMPANY INFORMATION (Page 1)
1. Business Name: Challenqe Printinq, Inc.
Address: 7500 Golden Trianqle Drive
City/State/Zip: Eden Prairie, MN 55344
Phone: 952-903-4400 FAX: 952-942-0973
2. Contact Person at Company: Joseph E. Hanneman
Title: CFO Phone: 952-903-4519
3. List the Company=s:
Primary bank of account: _US Bank
Contact Person: Dave Peterson. VP
Phone: 651-466-8264 FAX: 651-466-8927
Maximum Working Capital Line of Credit: $8.500,000
Current Balance: _Keep no cash balance, line of credit is about $4M
Attorney:
Name: Tom Hart. Winthrop and Weinstine
Phone: 612-604-6624 FAX: 612-604-6623
Accountant:
Name: Terrv Rust. Larson Allen
Phone: 612-376-4610 FAX: 612-376-4850
S-10
4. Subsidiaries or Affiliates:
List all affiliates and subsidiaries of the company or individual owner.
NuQuest Print Solutions, Subsidiary of Challenge Printinq, Inc.
5. Standard Industrial Code Number(s): 2752,2789,2791 ,2796,2657,3993,3089
6. How is the company organized? _ Sole Proprietorship _ Partnership _ C Corporation
-L Sub-S Corporation_ Limited Liability Corporation
7. a. Major Customers b. % of Sales
Target 19%
GameStop 4%
Imation 3%
International Dairy Queen 3%
8. Does the company currently export? Yes_ No X
9. Have there ever been judgments or injunctions against the company or owners? Yes_ No X_
- If Yes, describe:
10. Is there pending litigation involving the company or owners? Yes_ No X
If yes, describe:
S-11
11. Has the company, or the owners of the company, ever filed bankruptcy? Yes_ No1-
If yes, describe:
12. Within the past five years, has there been any violation(s), citation(s), or complaint(s) of
discrimination filed against the company in a state or federal court or before any state, federal or
local government agency? Yes_ No_X_
If yes, describe: (also attach a copy of the violation(s), citation(s), or complaint(s) and the disposition
of each).
S-12
BUSINESS OWNERSHIP INFORMATION
1. Owners/Shareholders
% of Shares
Name Outstandinq
Robert J. lothenbach 100%
2. Directors
(Name)
(Name)
(Name)
3. Officers
President (Name) Robert J. lothenbach
Chief Financial Officer (Name) Joseph E. Hanneman
Vice President (Name)
Secretary (Name) Joseph E. Hanneman
Treasurer (Name)
4. Describe any changes in ownership in the company during the past five years. None.
S-13
, PROPOSED PROJECT FINANCING
/
if Funding Source: American Family thru LJ Melody
Contact Person/Phone Number: Murray Kornberq 612-336-4230
Amount Requested: $15,600,000 (purchase newbuildinq and do the expansion)
Status: Committed X (Closed 7/15/04) Denied -
Funding Source: US Bank
Contact Person/Phone Number: Dave Peterson 651-466-8264
Amount Requested: $4,000,000_(Relocation expense off-set loan)
Status: Committed - Denied - Pending. _ X.
l
/
./ Funding Source: Key Equipment Finance
Contact Person/Phone Number: Scott Todd 952-841-6334
Amount Requested: $6,795,000 (purchase 81" $ 41" KBA presses)
Status: Committed X Denied
-/
Funding Source: _MIF and Challenge Printing, Inc._(Vendor Creo America's)
Contact Person/Phone Number: Joe Hanneman, CFO. 952-903-4519
Amount Requested: $599,591 (purchase VLF Magnus Platesetter)
Status: Committed X Denied -
* ATTACH A DETAILED COMMITMENT LETTER FROM EACH OF THE ABOVE FINANCING
SOURCES, INCLUDING A LETTER OF COMMITMENT FOR ANY BUSINESS EQUITY.
COMMITMENTS MUST INCLUDE AMOUNT, INTEREST RATE, TERM, COLLATERAL AND
CONDITIONS OF LOAN.
S-14
.'~
.1 MER~CAN .F.A1v!!.!=X.__!;IFE INsugA.~~g_ CO~PANY..__._____,__"
.6000 AMERICAN....K\\'Y . ~IADtSON WI 33183-0001 . PHOlilE: (60S) Z~9.2111
June 22> 2004
R9qert J. Lotl1enbac11
c/oMtip.ay Kornberg
L.J. MeJo~ & Company
.81 Soutli9 1 Street" Suite 400
Miul1eapoJis, MN 55402-3227
D~ai' Mi', Lothenbacb:
American Family Life Insurance Company ("Amedcan Painily") agrees to lend Robert J.
Lothenpach up to $15iQOO~OOO. subject to the terms and conditions set forth in Exhibit A attached
'heret.o and by this reference made a part hereof. The loan wUl be secured by, inter alia~ a first
mortgaf$c on the property located at 1000 Valley Paik Ddve, Shakopee, Minnesot.a.
If the JO.ail 'comrn'ltment offer as. described hereby (the "Conuuitment") is satisfac:t:ol'y, .please
uidicate YOlltacceptatlce: by exe.cutingboth original copies of this . letter where 'hidicated and
returning Ol1e executed copy to American Family along with. the deposit required by Section 7.S
,.of EX:hib~t..A. 'by JUne: 24,.2004. If the e~ecuted copy 'allQrequired deposit are not received ,by
A:1))eri~l1 'F,tlluily bYS~lCl.1 date. Qi' ~f theeXeCl!teq.copy' incorporates any modification 'of the
COil1iuIUnent as iSstled which ,i$unl.lce~ptableto Ame1'jcall F~11lily in its sole and absolute
discretion. the offer l'eptese.med heN~:hy 'shall expire and be null aIld void.
--.
.Sincerely,
W~~~ ~ Athttti
DAVID L. SEBALD
. ..
'Dltectol'. Altel'.Mtive Itlvestme.nls
ACCEPTANCE
The tetlnS alidconditiQl1s QfthisCQf\unitluent are hel'ebyaccepted tins 2"3~ay of June. 2004.
BY: R7~
----..
Robert J. Lothenbach June 22, 2004
2. LOAN TERMS
2.1. First Note and Second Note.
The Loan shall be evidenced by a First Note or Second Note executed by Borrower,
payable to the order of American Family.
2.2. Loan Amount.
The principal amount of the Loan shall be in the maximum total amount of $ 15,600,000, ,,/
to be funded in two advances:
A First Advance in the amount of the least of:
(a) $10,350,000; or, V
(b) 75% of the First Appraised Value; or,
(c) The amount calculated using a 1.15 debt coverage ratio, the ratio of Cash
Available for Debt Service before completion of the Addition and inclusion of
the Addition in the Accredited Lease, to the maximum annual debt service under
the First Note; or,
(d) 90% of Borrower's cost to acquire the Premises.
A Future Advance in the amount of the least of
(a) $5,250,000; or ./
, (b) The difference between (i) 75% of the Second Appraised Value and (ii) the
principal balance of the First Note; or,
(c) The amount calculated using a 1.15 debt coverage ratio, the ratio of Cash
Available For Debt Service after completion of the Addition and inclusion of
the Addition in the Accredited Lease, to the maximum annual debt service under
the Second Note with respect to the amount of the Future Advance; or,
(d) 90% of Borrower's cost to construct the Addition
The Future Advance will be funded only if the Addition has been completed and
occupied by Accredited Tenant in accordance with the terms of this Commitment.
2.3. Interest Rate.
First Note: The outstanding principal balance of the First Note shall bear interest at a
rate of Six and Thirteen One-hundredths percent (6.13%) per annum computed on the
basis of the actual days elapsed on the assumption that each month contains thirty (30)
days and each year contains three hundred sixty (360) days.
Second Note: The outstanding principal balance of the Second Note shall bear interest
at a rate of Six and Twenty-Five One-hundredths percent (6.25%) per annum computed
Loan Commitment Offer: Exhibit A Page 11 of 55
June 22, 2004
on the basis of the actual days elapsed on the assumption that each month contains thirty
(30) days and each year contains three hundred sixty (360) days.
Monthly Payment.
First Note: The First Note shall require payments of interest only until maturity. The
First Note shall mature eleven (11) months after the date of the First Note.
Second Note: Principal and interest payments required by the Second Note shall be paid
to American Family as follows:
(a) Principal and interest shall be paid in consecutive equal monthly payments.
Monthly payments shall be determined with reference to the Amortization
Schedule attached to the Second Nq~d made a part thereof. The Amortization
Schedule shall reflect a fifteen (15) year (360 day year) amortization of the
principal amount of the Second Note with interest computed on the declining
principal balance at the fixed rate of 6.25%.
(b) The Second Note shall mature and be paid in full fifteen (15) years from the date
of the Second Note.
If Borrower is in compliance with all terms and provisions of the Loan Documents and
does not owe any sums to American Family pursuant to the Loan Documents other than
regularly scheduled future payments of principal and interest, then all monthly Loan
payments received by American Family from Borrowerduring the term of the Loan
shall be applied first to interest and then to principal in accordance with the Amortization
Schedule attached to the First Note or Second Note. However, in the event Borroweris
not in compliance with all terms and provisions of the Loan Documents, or owes any
sums to American Family under the Loan Documents other than regularly scheduled
future payments of principal and interest, any payments received by American Family
may be applied by American Family to any amounts due under any Loan Documents in
such order as American Family may determine, notwithstanding the application of
regularly scheduled monthly payments shown on the Amortization Schedule attached to
the First Note or Second Note.
All payments hereunder which are due on a Saturday, Sunday or a Federal holiday shall
be deemed to be payable on the next business day.
Interest on the Loan shall commence on the date the Loan funds are disbursed by
American Family.
2.5. Late Charge.
Any monthly installment payment or other payment, including monthly payments of
escrows for Impositions and/or insurance premiums required by the Mortgage or any
other Loan Document, not timely paid by Borrower shall be subject to a noncumulative
late payment charge equal to five percent (5%) of the amount of such payment.
Notwithstanding the foregoing, monthly installments of principal or interest which are
not received within five (5) days of their due date shall not be subject to a Late Charge if
Borroweris making such monthly payments through wire transfer or other automatic
fund transfers ("AFT") structured so that American Family receives such payments by
Loan Commitment Offer: Exhibit A Page 12 of 55
OMS No. 2502-0265 (Exp. 12-31-86) Page 1
A. B. TYPE OF LOAN
CARVER COUNTY ABSTRACT AND TITLE CO 1. 0 FHA 2. 0 FmHA 3.1iI CONV. UNINS.
CLOSER: 4. 0 VA 5. 0 CONY. INS.
DATE OF PRINTING: 07/15/04 ~ 6. File Number: II-20922
TIME OF PRINTING: 11:17 ,r II-20922-001 SC1 SCO
7. Loan Number
SE~STAmmMENT 8. Mortgage Insurance Cas~ Number
U.S. DEPARTMENT OF HOUSING AND BANDEVELOPMEm
C. NOTE: This form IS fumlshea to give you a statement of actulll settlement costs. Amounts paid to and by the settlement a'1ent are shown. Items marked
"(P.o.c.)" were pald outside the ClOSing; they are shown here fot Informational purposes and are not Included In the totals.
D. NAME OF BORROWER: Lothenbach Properties I, LLC
ADDRESS: 7500 Golden Triangle Drive
Eden prairie Minnesota 55344
E. NAME OF SELLER: ' 1000 Valley Park, LLC
ADDRESS: 1215 Fourth Avenue '2400 Financial Ctr
Seattle Washington 98151
F. NAME OF LENDER: , American Family Life Insurance Company
ADDRESS: 6000 American Parkway
Madison Wisconsin 53783
G. PROPERTY LOCATION: 1000 Valley Park Drive
Shakopee Minnesota 55379
H. SETTLEMENT AGENT: Scott County Abstract & Title, Inc. I. SETTLEMENT DATE:
ADDRESS: 223 South Holmes Street, P.O. Box 300 July 15, 2004
Shakopee Minnesota 55379
PLACE OF SETTLEMENT: ' 223 South Holmes Street, P.O. Box 300 DI~~URSEMENT DATE:
ADDRESS: Sbakopee. Minnesota 55379 Jul 15, 2004
J. SUMMARY OF BORROWER'S TRANSACTION K. SUMMARY OF SEUER'S TRANSACTION
100. GROSS AMOUNT DUe FROM BORROWER: 400. GROSS AMOUNT DUE TO SELLER:
101. Contract sales price 111 500 000.00 401. Contract sales price 11 500 000.00
102. Personal Property 402. Personal Property
103. Settlement charges to borrower (line 1400) 282 ~92 .35 403~&:'$WiW_wa\~1$J%.'%.,*$ wb: ;i>:'.<>>,..;"..iW.\!@@
104. 404.
105. 405.
Adjustments for Items paId by seller in advance Adjustments for items paid by seller in advance
106. Clty/town taxes to 406. ~Ity ftown taxes to
107. County taxes to 407. County taxes to
108. Assessments to 408. Assessments to
109. reim from LeC to seller for roof repair 4,600.00 409. reim from LeC to seller for roof renair 4 liDO. 00
110. . 410.
111. 411.
112. 412.
120. GROSSAMT DUE FROM BORROWER 11 787 292.35 420. GROSS AMT DUE TO SELLER 11 504 600.00
200. AMOUNTS PAID BY OR IN BEHAlF OF BORROWER 500. REDUCTIONS IN AMOUNT DUE TO SELLER:
201. Deposit or earnest money 501. ExCllss deposit (see Instructions)
202. Principal amount Of new loan(s) 10 350 000.00 502. Seltlement charges to seller Olne 1400) 685,765.23 '
203. existing loan(s) taken sUbJect to' ~. existing loan (s) taken subject to
504. Payoff of first mortgage loan
204. Partial return of App Fee/Commitment Cep 268 250.00
205. 505. Payoff of second mortgage loan
~'''' :...... ~~>.r;,: ..... . . .' ~ir: m,~;:'.; ..r;WgWlilftWY4# '.PH!fmf ~ .~ ::~ ..,
',.0:0
206. Earnest Monev 250,464.90 506.
2.(JT . 507.
208. 508.
!.209. 509.
Adjustments for Items unpaid by seller Adjustments for Items unpaid by seller
210. CIty/town taxes to 510. City ftown taxes to
211. County taxes 07/01/04 to 07/15/04 9 620.83 511. County taxes 0'Zl01/n4 to 07115104 9 620.83
212. Assessments to 512. Assessments to
213. 513.
214. 514.
215. 515.
216. 516.
217. 517.
~18. 518.
!19. 519.
120. TOTAL PAiD BY/FOR BORROWER 110 878,335.73 ~~ TOTALREDUCTIONSAMTOUESEUER 695 386.06
300. CASH AT SElTLEMENT FROM/TO BORROWER 600. CASH AT SElTLEMENT TO/FROM SEUER
101. Gross amt due from borrower Olne 120) 11, "'0'" .,0., ~ 'Ie; 601. Gross amt due to seller Oine 420) 111.504,600.00
;()2. Laee amts pald by/for borrower Olne 220) ( 10,878,335.73) 602. Lan reductions In amt due eeller pine 520) I ( 695,386.06)
03. CASH(/i1I FROM) (0 TO) BORROWER 908956.62 603. CASH(1i TO) ( 0 FROM) SELLER 110,809.213.94
I have carefully reviewed the HUD-l Settlement Statement and to the best of my knowledge and belief, It Is a true and accurate statement of all receipts
and dIsbursements made on my account or by me in this transaction, I further certify that I have received a copy of the HUD-l Settlement Statement.
s_, $eller
Lotbenbach Properties I, LLC 1000 Valley Park, LLC
To the best of my knOWledge, the HUD-l Settlement Statsment which I have prepared Is a true and accurate account of the funds which were received and
have been or will be disbursed by the undersigned as part of the settlement of this transaction.
&tttfementAgent Oal.
NARNING: It (8 <<. clime to knowingly make feJse statements to the UnJted States on thJa or any alherl1mJlarfotm. PeneJllH upon conviction can fnclUde a fine and Imprisonment. For detalls see:
TItloI8U.8.CodoSodlonl00l and _on 1010.
IMS mm 1/'lJOI:'\ n't"l,..n. .._ '''__.
F.2857.Ql 4/80 Page 2 OMB No. 2502-0265 (Exp. 12-31-86)
O~f/ABS# I-20922 LSETTLEMENTCHARGES TIME OF PRINTING: 11: 17
ESe I-.20922 SCl SCO DATE OF PRINTING:n..'-i,-,,/nA
700.. TOTAL SALES/BROKER'S COMMISSION besed on prlee PAID FROM PAID FROM
S 11,500,000.00 @ 5.500 %- 632,500.00
Division of Commlsslen (line 700) as fellows: BORROWER'S SELLER'S
701. LB: 3.000 S 345,000.00 to Welsh Companies FUNDS AT FUNDS AT
702. SB: 2.500 S . 287.500.00 to CB ~ichard Ellis SETTLEMENT SETTLEMENT
Inc.
703. Commission paid at Settlement
(Money retained by broker applied to commission $ ) 632,500.00
704. Other sales agent eharges:
705. Additional commission: S to
BOO. ITEMS PAYABLE IN CONNECTION WITH LOAN
801. Loan OrIgination Fee %
802. Loan Discount %
803. Appraisal Feete The Valuation Group, Inc. 9 000.00
804. Credit Report to
80S. Lender's Inspection Fee to
806. Mortgage Insurance Application Fee to
807. Assumption Fee to
808. Broker Orig. Fee to L.J. Melody" Company 156.215.00
809.
810. Environ. Assessments. to The Javelin Group 1.3 550.00
811. OUt-Or-Pocket Expenses, to American Fandly Life Insurance Coin 696.94
812. ADDITlnNAL ITEMS PAYABLE IN CO!rnECTION WI-' LOAN ATTACllED\ 52 400.00
900. ITEMS REQUIRED BY LENDER TO BE PAID IN ADVANCE
901. Interest from to @$ Iday tor o clays
902. Mortgage Insurance PremIum for 0.00 months to
903. Hazard Insurance Premium for 0.00 years to
904.
905.
1000. RESERVES DEPOSITED WITH LENDER
j 001. Hazard Insurance 0.00 month @$ per month
1002. Mortgage Insurance 0.00 month @$ per month .
1003. City property taxes 0.00 month @$ per month
1004. County property taxes 0.00 month @$ per month
1005.. Annual assessments 0.00 . month @$ per month
1006. o.oomonth @$ per month
1007. 0.00 month @$ per month
1008. 'n--ate Accountina Adiustment 0.00 0.00
1100. TITI a:::
1101. Settlement or Closlno Fee to ~~ott County Abstract and Title, Inc. 250.00 250.00
1102. Abstract or title search to Scott County Abstract and Title, Inc. 300.00
1103. TltJe examination to
1104. TltJe Insurance binder to
1105. Documant oreoaratJon to
1106. Notary fees to
1107. Attorney's fee to DeWitt Ross" Stevens S.C. 17,312.50
1108. Title Insurance to Scott County Abstract and Title, Inc. -
~noludesaboveltemsnumbers:) 1103, 1104, 1109 and 1110 .= --,;-, ~.;t.f:?,~~ ,,"'."~ : :-t,..~ ~:~
.~<::~<<~.,~ ~..', ":~X"" ...,:~mt;::l:
1109. Lender's coverage $10,350,000.00 $ included in owners amount . . ';: x ..'~'...' )~~. . . :'. :.. -::: . '. .' .... .~..: ~:Yj
1110. Owner's coverage $11 500,000.00 $ 7,575.00 ~. ~::: .' .~ ~b~' . '. ->:. . "}~},:. '~'. : ~ ~,: .~ .:::E .~~
1111. Assessment Search" Service Fee to Scott County Abstract 30.00
1112. Endorsement Fees to Scott County Abstract" Title, Inc. 550.00
1113.
1200. GOVERNMENT RECORDING AND TRANSFER CHARGES
1201. Recording fees: Deed $ 35.00 ; Mortgage $ 78.00 : Release $ 78.00 35.00
1202. Clty/countytax/stamps: Deed $ ; Mortgage $
1203. State tax/stamps: Deed $ ; Mortgage $ 23 805.00 37 950.00
1204. Additional Recording/Service Fee to Scott County Abstract 100.00 20.00
1205. Conservation Fee to Scott County Treasurer. 5.00 5.00
1300. ADDITIONAL SETTLEMENT CHARGES
1301. Survey to Rehder &: Associates, Inc. 1,076.91
1302. Pest Inspection .to
1303. Recordina of Releases (2) to Scott Countv Recorder 40.00
1304. 1ftt 1'2 2004 taxes POC
1305. .4 T~~4'" ~"~ n. ... ..' ft_." ~_ n__ .78.00
1306. M'__ ~.__. 'n Onn.. n......, ,.....__. .." ~..,_ ?c: nn
1307. , A '" n ..,.,
1400. TOTAL SETTLEMENT CHARGES (enter on lines 103, Section J and 502, Section K) 282,692.35 685.765.23
I have carefully reviewed the HUD-1 Settlament Statement and to the best of my knowled?e and bellef,lt is a true and accurate statament of all receipts
and disbursements made on my account or by me in this transaction, I further certify that have received a copy of the HUD-l Settlement Statement.
Borrower Sillier
Lothenbach Properties I, LLC 1000 Valley ParI<, LLC
The HUD-l Settlement Statement which I have prepared Is a true and accurate account of this transaction. I have caused or will cause funds to be
disbursed In accordance with this statement.
SelllementAgent Date
WARNING: ft I. scrfme to knowingly mekefalSe &llllement to the Unfted still.. on thl. or any other olmllerlorm. PenaJU.. upon convlctlon con Include. flne end Imprisonment. Fordetelle...:
T1Ue18U.B.CodeSectlon 1001 end SectIon 1010. .
BMS HUD-l (3/86) RESPA. HR4'lO.U
OMS No. 2502-0285 (Exp. 12-3H16) Page 3
ORD#/ABS# I-20.922 SUPPLEMENTAL PAGE TIME OF PRINTING: 11: 17
ESe 1-20.922 SCl SCO DATE OF PRINTING: 07/15/04
ADDITIONAL BUYER SETTLEMENT CHARGES
CHARGE AMOUNT
812.001 Post-cl legal Fees to DeWitt, Ross & Ste $ 650.00
812.002 Post-cl disb to DeWitt Ross & Stevens SC 375.00
812.003 Legal Fees. to Oppenheimer Woff & Donnell 1,000.00
812.004 Atty Fees to Winthrop & Weins tine (est) 50,000.00
812.005 Disburse etc. to DeWitt Ross & Stevens 375.00
TOTAL ADDITIONAL ITEMS PAYABLE IN CONNECTION WITH LOAN (LINE 812) $ 52,400.00
ADDITIONAL SELLER SETTLEMENT CHARG~S
CHARGE AMOUNT
1307.001 Payment to Cairncross & Hempelmann, PS $ 14,4.90.23
1307.002 LOC Transfer Fee to Wachovia Bank 120.00
TOTAL ADDITIONAL SETTLEMENT CHARGES (LINE 1307) $ 14,610.23
, have carefUlly reviewed the HUD-t Settlement Statement and to the best of my knowledge and belief, It Is a true and accurate statement of all receipts
and disbursements made on my account or by me In this transaotlon, I further certify that I have received a copy of the HUD-1 Settlement Statement.
Lothellbach Properties I, LLC 1000 Valley Park, LLC
1MB mm_1 ('t/9.~' 'D'Q(n)" un ""nC'I"ll
Deborah A Sansone ~
Senior Account Manager;
Key Equipment Finance
A Division of Key Corporate Capita/Inc.
66 South Pearl Street
Post Office Box- 1865
Albany, NY 12207-1865
Tel: (518)257-8269.
_ ...._._._.__.___...._.__. ___.' ._c .. . . Fax. (518) 2578824
, ... ..._.h.'..._.........._" ." ....._......:; ,.~..~.__....__..._._..__...._."..._.~..____..... '_'__N"_"_'__"'__~'_'_',_!._,._~",_, '_'_~_"h''''_'''_ ..~."'
November 6, 2003
JIM BAYLISS
. CHALLENGE PRINTING, INC.
.7500 Golden Triangle Dr, Eden Prairie. MN 55344
Dear Mr. Bayliss: .
The members of the National West Business Unit are pleased that CHALLENGE PRINTING, INC. has chosen Key
Equipment Finance, a Division of Key Corporate Capital Inc. to provide equipment financing and we look forward to
servicing your transaction. As your Account Manager, I will be responsible for ensuring that the documents are executed
properly, and the proceeds are paid out in accordance with your instructions. .
The documents that need to be executed are enclosed. Those requiring signature in the presence of a notary public have
been marked with an asterisk. Your package contains the following:
1. Progress Payment Loan and Security Agreement
2. Progress Payment Promissory Note
3. Assignment of Purchase Agreement
4. Consent to Assignment and Agreem~ent
5. Verification of Insurance
6. Amendment to Master Equipment Lease Agreemen~ dated September 19, 2003
Please have one of the duly authorized officers designated on the Certificate of Authority sign the documents.
A Certificate of Insurance naming KeyCorp and its subsidiaries and affiliated companies, including Key Corporate Capital
Inc., 66 South Pearl Street, Post Office Box 1865. Albany, NY 12207-1865 as additional insured and soJe Joss payee with
respect to the financed equipment, is required before funds can be disbursed.
In addition, the following item{s) is/are also needed to close this transaction:
. Consentto Assignment and Agreement executed by KBA North America Inc.
Upon receipt of all executed documents and other items noted above (as applicable), KEF will execute the documents
and commence your loan. If you require copies of the fully executed loan documents, please let us know.
Please call me with any questions or concerns you may have during the closing process. Thank you for choosing KEF.
Sincerely, ...
)J7;h A Sansone ~
. . ./Q);2.CJC .... ta
· Senior Account Mana er . 'OXA..
Enclosures
Note Cover.o03
..."'!'~: .w.... w..,tJ.. .':::~:~: t. :
.. .' . Key EQu~ent Fman~ ~ Division of. Key'. COIJlGIjlU Capital'Jn.c. is pleased. to preSent tIle.' follo\\ing . '. .. .
< equipment fuiancAAlg proposal rot 'yourre\ie~ 8mi 'consi~rati~n.~.'. n.~. following lenns 311d' conditions are .'. .: . :.'
c .......b~~~~to~~~..> ..> ""'...,' ...
..:. .SUMMARY'O;F TE1(JlSAND CONDItioNS. . ."
;..... ',;".\':::\<~' .,:.....:.<:::... i."":': :.;:: ....:\..' ..:.'.:.'.:":";.:..'>:':.:. '~":':':,,: :-,' ,....~
" "
.,.;'. tESS~R.'" ...... ." .~~pm~~ariivisionOfKeYCorporirte:~~i~InC.,.,... >:
. :.:.>; ",' ....:..:,..... .'.o~~~$i~ee '" ....': >:. ," :.: ::. ....:..<.../.......:..,..:..
,...L~SEE". '..Challe~~g ....,: ..:; "'" .'::.:.
'. ......,.. .,',' .......EQUIiMENl. ...... ....... .....:, ........... .:.
i>ESCRIPT~ON :. .... .103APress6c:olor :. . . i .' .
' '.' :': .~ ',' ' ' . . ~ . : ':'; .. . . . :: . . : ". . . . :- ~. ..
. . . EQuIPMENl' LOCAtION .7490 Gold~ Triailgle Dc . .
. .' ". . Eden Prairie, .tv.fN 5$344
.. E~~fMEN~C,OST'S;.OOo.OO<l;~ '. .. > . . .
CLOSING DATE. .... . . '.. .; .,.... ..' ..
. ..
. ~Pr~posali~ b~~ ~ili~ ~~c;~th<? ~~tl~ ~ the cl~~~'t~{tbi; ~~tio~~m~' .'.
plaCe ~ D~.inbe.r2004. If: the 'closing does not take place 'on this datct the Rental Amounts (and other
'.. .'. . . cCQnomic factQtsj set forth herein DJaY be adjUsted to ~tlect the .actua1.d3te of closing: All fundings will be . .'
. '. 'co~ditiQnr4on,the deJ.ivet.y'a.od.8oce~~oftbeEquipme~tby.~~' . ..,' ". ";
..' ........ ....~ " .'. ........ '.LE~SE i;F~~MAl~6~.' ........ ......... ." ..... ·
;LE~S~.TYPE/D.().~UltIENTATI~N. ,'. ...... . "<:'. ........ . .:. ....
. . Tu Le3se~ evidenced by dOcum,et.tfBtion to be provi&A bY. LesSor and satiSfactory 10 LeSso[ and LesSee. this'. : .
. " . . ..documentation will be the final ~ complete ~on of~~ finan~ng ~l~ in.tbis pro~1. ..'. . "
. , . .' . ~. '. . ' . . ." . , . .. ~ ~ . .
. '. . .
..,".' ". '. ",
. '. . .
:..'
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. . \ '. , .~.
'. .'
'.'
'" ., . '. , ,. .... ..
'. . '. .' , " '. ..
'. , . '.
'. . .,'
. '. . .'
, .
; .' '.
. . ' .
.~ . . ..' .: '.::<,: :#CRe~l3i4m~~~bleinonQiiY~adVarice, eXpreSsCdasa.perce$geOfEQm,pmemC<)Sf, 4'1.066117Yo, ...'....'.
. . . . . .' . ' ': " '. . and is subjecUoadjuSUnCO:t prior to lease cl~ii1g as set fortb. below..' A per dierri rental cbar~ asseSsed from .. , ,'.: '. . ". ' . . .
' .. ; " . . '. '.' th~ certificate of.aca:p~nce date up to ~e ~ 9>mmencemeOt Date of ~ Lease, shall be due on the Rent' ". .' . ..'
. ..' ..'. ' ,:. Cc.alm~mentDate.'lffundingocCwred inMa}r2004. thef<ltefact:of\\'Outdbe 1.073,723%:witha3<l.22% . ....:
'. . ,: .' EatlyBnyoutOption ..... ".' . ". ..' .;. .... ",.". ,..' . .
.' . '. '.' ';:A~:J~STM~j,,;OF' RENTA~ ~~~~~T~RIO~;i 'i~~S~CL~;I~~ " . ......... .>
'. . ";. . . . ',: ...::.... ~:':" ", :. . : '.; ',' ". . ..,.".' '.' '..', ';. ,',": .... ;',":"" . " ..\ :".: .' ....:'.... . ,....:. : :.:' "~:.". ,... . . .., ..~. . :', ',. ....." . :"::.. .
".;. '. . ., During tbe Initial LeaSe Term ~d a Ren~wa1 Terin. if any. the Rental. Am~t iapJacc atJease closing will be . '.
". .:,::fOc.Cd,.:'}lieRen~A.mountquoted.hl1ius:l'ropOsal"'aScatCuJ.alCdUSi1)g:aspreadoVer~e PailyTreaslUy Index . " .' '.' .
:. . for Scptembcr 10, 2003. The'.RentalADl~tshanbeadjus(edtoleasectos.ingtcre.flcctoJlan8cSjntheDaily . . .': '.';. .'
.. .:' .... . .' ....rre3suxyInd~-ontil1heRentCo.mniencementDateunderlheLease(and.thensba11be~edfot'thetennoftbe.'- ....
", >:I..tiaI~;T~~8~,T~'S?'~:',:,'i ,i..,"'),':,. ........ .
. .:' .' . ~., the Daily T.rcaswY Ind~ fOf the day on w~c1i ihe final' eqUipment .schedule ~dencin~ this transaction (~S' . ,.' .
.....: '. . ..... detenoi.ned byLessOr) is.~ttoLes~ by L.essorisgeater ~ orless!ban 3.95%0/0...:. ,,: ,,' .
.,.... ...... .'. "';.:'>"','~>'i " ...... .....",., .....) ....
: .' . . for eaoh one basis point (.01%) variance. tho'iate upon \\:hich the Rental AmOWlt is calctdalcd S~l be '.' .'.
:" .. :.;. '. increasedordcCr~asthecas~maybC. byon~basispoint(.Ol%): ......' ,,: '. " ;'.' ",. ..... , ';,:
". :, . '.' .::....'.:-<.., .:. :-- ....,..':'.,;: . >..' ..: .... ::";. . ':...... ....: '",',,:'-'.. :. :' ,;,.'. .... . .'.". ,.,..";.;: .': .' . .,....... ': :.'. .' . '. ',' ..,'. :. ;.
.' . BaSed upo~ ~ n~w rate. thCl Rental AmoUnt snail be adjUsted acCordingly. . As used in this Sectioi1; the leon ';'. . '.' .
".- . . 'yailjr Treasu.lYind~ shaD mean the avenige yield onUnitcd.Stales T~ s~ties haVing ~ matUrily' '.'
'.: ..' .. ' date (excluding Securities with. call oPtions) which corresponds tethe weighted average life of. 84 months rOt . . ,.
;. ":, . ... . thejl1:'Oposlll. as' announcCd .in the :. "rreaSUIy Bonds,. NoteS. & ,Bills. section of. The . Wali Street'.Journa( .. . :.
.'pubIisll00 on the. cia)' ofdetenuination. or if The Wall Street J()umQJ is Dot published on such day, ~ Ule most. .. .'
. . r~tly published edition ~f 11le W~l Street Journal. If no, ~ch securities have 8lnaturity date (eicluditlg ';,;.
':. . . seciui(ies wjdl Call Options) .which ~ponds .to the'1'I'f:ighted average life. of 84. m~s, adjustments \\iJl be ..' ". ...... ;....
based OA the. first slIcci:eding nionth to have matw:ilies (e.g., if no such securities .mature in Aug 97. uSe Sep 97 .' . . . . .'
. ... '.' Wa.luri~, [or first month following sep.~.in ~hich there: are nwunties]). '.:. ",' , _ ..: '. .' .
.... . - . ,i R.};~~ A~r iY~f~~ '~H~Ni < .; .-> <q-,'.: ". ..... .... .... .. .....';. . .... .... .....: '. ...... . '. :
. :,;..:'. ' . Lessee may ch~ ~o Vat R~ Amount by using Lessees au{omati~.diiectcJebjt se.rvice (Optioii'A), $1)bjoc:t' ".'!
'. : ..::. '.' to written a8{eeinent betw~ LessoundLessee, Ot by isSuing a' ch<<;ck paYable tQ ~ey EqUipment Finance.>. : .I
'. .. ..... <option B);. Please indicate yoUr preferenCe by checking the correct option at the end of this l'tOposal .' :. '. . ,.: . . . >,"
. '.', . ;.. ..' ..'~NJ>- ~Fh\SE ? l1~l?tff. -'.";" '.. . ',. . ." ..... , - .... '..( j
.. .:. ,.At thc~tiOB .ofthe Initial Term. if~see is not in defaUlt, Lessee. shall ~'C .the option.to eith,er. (I) pwcltase ;' . :'. ',..:' ,'.1
. .',', "'>. '.theF.quipmentf()ttheth~FairMarket~leVa1ue;(2)~~thisLc3seOnainontb.tonioothbasisat1he&une', ". '\. :>
',. ,,'. R~nt payable at the e.~ir.rtion of the Initial Temi; (3) renew this Uase.~ot a mininltim' period of not le~ ~n l2 . . .'. . ". I
. .oon1hs at the then. FaIr Mad:et Rental yahtc; or (4) retum the EqWp~t to Lessor putS1J31lt to. and In the '. . .1.
'.... . .'. . ~nditionreqmi'edby, the Lease..IfLessce'~S to' give ~r nUnimUltl notice ofitS exercise; ~ .shan be .' ... "'.;..: . . 'i
. . . .. . dlieiricd to. ha\-'e cll,ose(1 option (2) above. At the' ~oi1 of any Rene\Y3l Tenn.' if Lessee is not in dcril.ul~' :'.' .... . ..'1
. ", ,',' '.. .
.. . ~ . '. Lessee 'shallliave theoptioo.m. either: (a) purchase the Equipmem.fot ~ then J1ai! Market Sale .yalue; (1)) It~.'... . . .' ':.: ,':"
. '. '.' <. .'. this.LeaSe.'onamon,lh'tolhoi!.th basis at1bc;SaroC.RentpaYible attheexpiration.orthe~ch.'additi~ pcdod; (c)' ':..:
....,' . :."rateWthis~.roraminimumperiodO(not1esstlJan1.~moIl!bs.atthethenFairMa.(ketRenta1Yah~or(d) ":".
.,:i . . Ieturn1he Equ1pment:t~~pwsUaitt to, 2nd In lhe coildition lequfrea by, the Lea.si IfLessce faiIs'to'givc. '. ':-.'.. . .
.:~. ; .' .1.ASs9tminiirmmnotice ~filsel\:erctse, ~s~bedeeme(l.to.bavec~senoption(b) above..: ':' ~ ":: '. .':. .'. :;'> .. .
;,. :.....-:..:.... ':.::::::.;j~T~RI~~iNA~i~N(;:"':""':;""""';:'< ..,....>.:::.:., '..:" ....-.....H.;' :..:':.'" '. ':.:;...:.. '.",: ..'- .....::;...~:..:.:"..:.>.::..'.:.:.: ,;.' ,.":..: .~ .
. '.:.' . All ~uiprilent schedule(under ~ .prOpo~ Will 'c~n1mena: 01\. the fitstday of the. J,llorirh. 'If Les~. so .:'. ..... ',".-' ,;
. . ..;,'.:~q~esl$, subject ~oJ.essor'sappioval, LessOr. will advance pa~ents to ~~dorS:and Q13nufactUretS ()ll a'~ay. .... '::.:".
'. ,".i: other tll3ri. the first day of the month.. .. Interim ~t ~iUbe payable on the mnount funded.. from the date of .
. '. .:.'- . .'.":. "',' accePtance. ~f eqUlpmCpt to tb.e day of: lease. C()nunen~m~t.. which period shall,not e~30 daYs.. jnte~l :' . '.. ;.
. ,,:.- ".:.' Rent will be. calculated. as an amoun(eqUal ~ a rate Per day equal to 11360th of the Priri:1e Rale.1imCs the '. .' . .
. . .'. -..: . !lumber of day~ prior to the lease cloSing .date. As uSed heteil1, the ~~tne Rate" shall n:tean dIe Prime Rate' . " .:,: .'
.:. .: ','; '. publishedft"om tinuHO riinein.fhe WalJ.SlreeiJoum'al. .ne Int~nRentpayment will ~'due on the day on : :':._.' >"
"';':>.<:wbicbLessoradvan~tbnd$to~"endqronnanufacturer~.... .:.' ~'.':::::, '.' .....J:~...:.: :..". ;.>:.... .' .
.':":::'.:EARLY CANCELLA:tIONRIGHTS .. ..... . ..<",":: '.' ,". .....:'.. . . ,....
..... .'.' ",.': .. :.~~bj~,'t~ ce~ain.~oti~'~i1lb~~ ~f~eiau1t p~ovm6~s, 'ort a'd~~~ ~~biS'84 mo~~'~~~ ~~Re~~ '.: ';': p ":
:::. ' ....... Cc;,mmencem.oot Dale, Lessee shall have the option to putcha~e the Equipment for an eady bUyout priCe equal: .'
'. . . ',<;H to3Q.13.%or~e~u~eJlt~s~ .lheforego.~gop,tion.~iltl1otad'~~ly~tr~~~O~'~l~~~clltoftbe' '.:
.:. :: .u;a~~(;tlon. ..:..' ". ~. '" . ; "........ ',:" ....:. .:.,:... '.:. .....:. ;.... . ". ": . .'. 'c'
...... ... .... .. ... ~ET~~ASE ... . .... .. ..... ... .... ....; .... ...... . .......... ......... . .. ... ... ................. . ....... '. "
: " "., ..... . The~ will be anonCancelJable,net'leaSetxans8.c~on whereby lnSumnCe, mailltenance, 8~all applicable .... .
. . t:3Xes (including sates and/or. use taXes. which \vill be. addCd 10 the cOst of the Equipment or. coUcctcd Oil the . ....... ....
'.' ':.'. .:. :..... gross rentals. as 3ppr~te lUldcr the laws .of ~ particular state) ~. ~e tesponslolUlY of lhe Lessee., Lessor, .... ..
..... .... . ............' l>iIIm;no7~....~or~~~lhdlq'"r"-.<; ,,<<>
; . INSURANC~ . , . " . .. .' . . '. .' ". .: . . .'
". .'.'; '.; . ....... . . .:' :..' :,',' :.:-:.::.. .-<.... . >,.' .....
'. '.' '. . Lessee. will ptoVide adequate property' and liabiJitylnsuranoe With endorSemcnlS and in amounfsacteptable to . ....
: Lessor prior.to the deliyery of the EquipmetJ.t, Lessor will be named. as first loss payee under such pfoperty .' ......
. insuni.n~pOUcies~.as~a~~iiional~~tu1~etsuchliabil.itypoticies.:. :; : . . .... > ";':" '.;
. ..... .. .~OC~~NiA.i;O~ ;':E,..;\ >.. .'. . .... ..... .. ... . i'
.:. . '., . . Mlease closing; Lessee shall payfu ~ssora do;cumeni.1lion fee .lto $750.00~ plus'aD fces aitd' .
'. .' . . d,\sbU1'~ements (mc1u.dW.g attorney's fees) actUally wcwre4 by LesS?x to $eCu.re a l.!.en and/or negOtiafe
.. '.. :' documetlL1lion. . .'. . ". .'.':' ~: ..' . ....;.. ", ... . . '. .... .:.' . . .' '. .,
. .>~~I~U~Ll:~~~l1~Ti~~>:' .'>. .,......... .. ..... ..,..... .. ':
. '.';. . .'. '. Thisp~issubjecttoLessor'~resid~eva.luarion. 1beRental~ounts(andothereconomicfac(ors) set .'. .... :.-
'.: . forth herein may need to be adjusted. in accordance wilh di.trereoces between th~ acwal {e5idual values and lhe ". .'
" '. iesldtial values oontemplated by. this proPosal . .'. '.> . .'.' ".: ..,. :.: :" .:. :.', .',' .... .
..:.... '.' ~p~~t~.~.\Tl~~~:J.:l)~8:~T:..: .....>..,.... ":::"~"':>.:::.:":':: ,,0:'::",' ~:':'.:. ,':.:,':':.: ': ,. ..' . ,.:, ..
. '.: tcsSee'shanfo~vui1 tOl.eSSoranappiicationdq,ositeq~ lO$5~OOO.0()W1th thiS sitned~saiin" : ..' .' . .....
. oonsidefat{on of LessOc' s tmi:lsiiCti~ strtJcturing and ~ew' activilics.~'the i?:\-eDt that i.essor does not . . . .
. ..':. . ~p:prov~ .t~s ~sa.ction; this' applicafi<.ln d~it (leSs the cost of aI\y. out.7<)~f'cket ~xpenses inClJ.~ bY :'. .' '. ..' ..' .'
. ...;,' ". :' . .' . .' . ". .... .' ":. ...:. ': ,". ',,;;.~.' . '. . ".:' '. .' . .... . .' . ;.;.... .' .' '..' '. 0':'
", ,. . ..... '.' '. ; i. . ..' '~".. ":.#., . : ". . .' :..: ,':' ".:' '. .' ....
,. .. "" . ,.'.: '" ..... .:. ..,......::.:..:.:..: .' '; ." ......;.' . <c. ...... ..'-:
.... ...... .. ~,' .. ... ,: d '.> .... .... .,X. .. ... .'ii:: ..:
. .. .' '.
'," ',". .. "
. .. .. . ',- ". .'.;...... :..1
. " . . . . . ..
'. "~' . '. : ':.p" ...., . . transaction closes, thi.s application dewsit !ibaU bcapphed ()t.l a pro I;1labasis to Itilutt the fust R~nta1.',: :., :';.' '. ..' '. . .. -: . 0: .
:'. .': .' ". ,. :::. '~ayni~nt.rnall ~~~el1tS, ~biSapp1i~~ond~~~tmar~ ~~n~byl.es~.or...:' '.. . ~.'" '::." ::. " :.:-:.: .::.; ..', ". '. "'-. ' .
.'. .' '. Malty companies are uemptftom saleS an<vor- use tax: Fqr ~s()r to quauft for LeSsee's sales ta..u~emption. .':;'. '. .' 0:.
. .: . ,"'.. . a 'Valid .laxe~ptiori~ilicate~satisfa9t91:Y iti all respec~ tol.~ssoi; for~e s~le wheIl? the Equipmcnt\1iU.
.. ,'.... ..... .........;'. ..,....:J2:,Z;::t77.. 'i,i .. ... ,...... . ',~. \'.. ..... . ..:.' ........;:..'.....';.; ..,.... .',. ." ............. .... ....,.,'.,.. ....>
. :", . .:'. This Pl't)~ ~s~~ tbat'(l) ~soi. wiil be cOnsideK.d.o~er fur'Federal inc?O~e tax p~ (2)' the .c:.. ".
.: .'. "equipment is 7 years MACRS properur, and (3)' themll1rlmum available depreciation deductionS'on the fun.
. ..' :. amount 'of LesS~r's c3pi.talized ~~ of equipment are 8:Vailab1e to ~or. :Lesse~ warrants. ~d .teP(~n.ts to.
'< ..... " .:..:~o~.~~~t~e:~~~(2)a~.~.is.:~~r~..2~~~:.......:::.:.,:~..>.:'(: ...,...:." ....... . ',".:' ....<...... ....,'. ).:, . :'.! "':,'
. . . > : '. rhis propOsal assumes ~the tianSactiondes9ribed h~ is eli8t"ble fot" certam benefits (''Benefits'') of: . .. . . . . .....
.'. . , '. Public Law No: 107~147 (the Job CteaOoriand Wos:ker Assisiance ACt of2002).lfforany reaSOaLessor '" .' '.
., : dctenn,ines that'tlle tnnsaction is.not eligible for such Benefits, the pricin$ contained herein shall be mOdilied . . .,
....... . . "~:I~~.~~iiE"IE1~ ..~.."."..".. ......... ... .":: .............:.<...;.'./: .' ".i...
. .' Lessee shall fumish Lessor l\ith itS fmancial sfatements, in a foan SatisfaClO1y to' Lessor; for me fast three .' ". .
.' , .fiscal yeaxs'and'.1atest intemn fUJ.aDcial statements. 'Lessee shall also pr~ide the. name of its major bank. and ',' . .>
.' . the address, p~numbeC andaa;1OWlt ~cer~.' . " . .' '.. ..."..':. .' .: . .
...... :'~rRO~~s.ALA~~~P~A~~E/EXPI~ATI~N ..':"': ,.-.......:..~..;.". :';..~). ". .:. .."
: ,:.<~ ~;~ ~ stibj~ to ~~ by the ~e ODor Wore bCtO~t'~s, 200~, .t~~s t~isdale~ exten~d" ,.,....."...
... '. .'. .....in v.'litiJlgbY LeSsor. iiLesso't has not received a cop)' of this proposal, signed bY ~ssee; on.or before suCh :
.... .' " ." .... ..... :~.:A;G;fTxfw..... . ..H;" . ...~ ...... '\". ...... .' ....... · .~:...........;.:>i..... ........ .. ...........
,'. ,:'.- . . ~e R:eo.t .Amou~l. arid all o~ eConomic fact~rs which are part of tius'ptoposaI; will ,be adjuSlCd before each .' .: -: . .
: .. ,.lease clos~g to rellectsny c~nges in lhe ~emal Revenue Code of 1986 (the "COde") orits regUlalio.ll.S (as .......
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. .::- ,. : . .'your cPA andlor'la..~ad~Sor. LESSOlUIAS NOT MADl; AND ~REBY DISCL~ANY. ADVXCl; ". ". '.' .":: .
. :.., ..' REPlmSWTATIONS.-WARRANnESAND. COVENANTS.1ll1BERExPRESSEO,OR'IMPLIED. WITH........:.': ..:
. .... ..' ::RESP~CT TQ nus LEG~ ECONOMtC,.ACCOUNTING.. TAX AND/OR OT,i!ER.PF1$CTS .o.F..m~ '. . :.:.'.
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. ::.' If the fOfe80fug meets with your approva~' please sign the enclosed' copy and rewm it, to LesSor on of'before :....
. '. '" '.,'. die propOsal ~iratio~Dale ~ctfortlt above;' Our receipt Qfsucb signed C9PY. ,,'ill constiluleyoUrapplication . .. ,.
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. ..' . .' '. Th~ you roi allowing us 'the oPPort\~ty to preSent this ProPOsal: Hyou }lave any questions. please call me . ". .'. .:.' ..: ';,
.'. " at 952J841-6334." .: ", ..'.. '. '.' :. ..:,.... .... ." .:..,..: '. .
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OCT-27-03 MON 5:00 PM KEYEQUIPMENTFIN F AX NO, 952 841 6335 P. 2
.(),r .
~
:
"
'.
October 27, 2003
1im Bayliss
FjnMcial Planning D.irector
C:hall~Dge Printing Ine
7500 Golden Triangle Dr I
Eden Prairie, MN 55344
D~l" Jim:
Key Equipment Finan.ce, a Division of Key Corporate Capital Inc. is pleased to present tl\e fol1owing
equipment financing proposal for your review and consideration. The following tenus and condilions are
based upon infonnation furnished to us by you.
SUMMAR}' OF TERMS AND CONDITIONS
LESSOR Key Equipment Finance, a Division of Key Corporal.C Capital Inc.,
or its Assignee
LESSEE Challenge Printing
EQUIPMENT
DESCRIPTION KBA Press 6 color
EQUIPMENT LOCATION 7490 Golden Triangle OX'
Eden Prairic1 MN 55344
EQUIPMENT COSt $1,795,000 ~
. CLOSING DATE
This proposal is based upon both the assumption and the condition that the closing for this transaction will take
place by December 2004 If the closing docs not take place on this date, the. Rental Amounts (and olhcr
economic factors) set forth herein may be adjusted to reflect the actual date of closing. AU f'und1ngs will be
conditioned on the delivery and acceptance of the Equipment by Lessee.
LEASE INFORMATION
L:EASE TYPE/DOCUMENTATION'
Tax Lease, evidenced by documentation to be provided by Lessor and satisfactory to Lessor and Lessee. This
dOCUlnentstion VIiI I be the final and complete cxpr~$ion of the fmancing summarized in Ibis proposal.
OCT-27-03 MON 5:00 PM KEYEQUIPMENTFIN FAX NO. 952 841 6335 P. 3
INITIAL LEASE TERM 96 months.
RENTAL AMOUNT
The Rental Amount, payable monthly in advance, e~'Pcessed as a percenrage of Equipment Cost, is I.065000o/~
and is subject to adjustment ptior to lease closing as set forth below. A per diem. (cnlal charge, assessed from
the certificate of acceptance date up to the Rent Commencement Date of the Lease, shall be due on the Renr
Commencement Pate. Iffunding OCCUlted in May 2004, the mte factor would be 1.074504% with a 30.22%
Early Buyout Option
ADJUSTMENT OF RENTAL AMOUNT PRIOR TO LEASE CLOSING
During the Initial Lease Tem and a Renewal T~ if any, the Rentftl AmoWlt in place at I~se closing will be
fixed. The Rental AmoUflt quoted in tbis Proposal was calculated using a spread over the Daily Treasury Index
for October 24, 2003. The Rental Amount shallbe adjusted to lease closing to reflect changes in the Daily
Treasury Index until the Rent Commencement Date under: the Lease (and lhen shall be fixed for the term of the
Initial Lea,sc Term and an)' Renewal Term) as follows;
IF
the Daily Treas1.llY Jndex for the day on which the final equipment schedule evidencing this transaction (as
determined by Lessor) is sent to Lessee by Lessor is greater than Ot less than 3.88%,
tHEN
for each one basis poim (.01%) variance, the rate upon which the Rental Amount is calculated shall be
increased or decreased, as the case may be, by one basis point (.01%).
Based upon such new rate, the Rental Amount shall be adjusted accordingly. As used in this Section, the term
"Daily Trel\S1U'Y Index" shall mean the average yield on United States neasul)' securities having a matllrily
date (excluding securities with call options) which corresponds to the weighted average life of 84 months for
thepcoposal, as announced in the "Treasury Bonds, Notes & Bills" section of The Wall Street Journal
pubUshcd on the" day of determination, or if The Wall Street Journal is not published on such day, in tllC most
recently published edition of The Wall Street Journal. If no such securities have a matUrity date (excluding
securities wlth call options) which. responds to the weighted average life of 84 montlls) adjuslments will be
based on the first succeeding month to have maturities (e.g., uno such securiHes mature in Aug 97, use Sep 97
maturities [or farst mooth.foUowing Sep 97 in which there are maturities)).
RENT AL P A YMJ!:NT OPTIONS
Lessee may choose to pay Rental Amount by using Lesso,' s automatic direct debit service (Option A), subject
to written agreement between Lessor and Lessee, or by issuing a check payable to Key Equipment Finance
(Option B). Please indicate your preference by checking the correct option at the ond of this proposal.
END OF LEASE OPTIONS
At Ihe expiration of the Initial Term, if Lessee is not in default, Lessee shall have the option to eitller: (1) purchase
1hc Equipment for the then Fair Market Sale Value; (2) renew this Lease on a month to rnonUl basis at tlle same
Rent payable a.t the expiration of the Initial Term; P) renew this Lease for a minimum period afnot loss than 12
months at the then Fair Market Rental Value; or (4) return the Equipm~nt to Lessor pursuant to, and in the
condition required by, lIte Lease. If LcsSee faits to give Lessor minimum notice of its exercise, Lessee sball be
decmed to have chos~n option (2) abqve. At the ~"pication of any Renewal T~ if Lessee is llot in default,
UVf-l{':'Uj MUN 8:Ul rM KtY HlU I PMtNH IN HX NU. ~8! ~41 bl:l~ r. 4
Lessee sllaU have the option to either: (a) purchase the Equipment for the then Fair Market Sale Value; (b) reflew
lhis Lease on a month 10 month basis at the same Rent payable at the expiration of the such additional period; (c)
renew this Lease {or a minimwn period of not less than 12 monlhs at the then Fair Markel Rental Value; or (d)
retunt the Equipment to Lessor pursuant to, and in the condition required by, the Lease. If LeSsee fails to give
Lessor lb.inimum. notice of its exercise, Lessee shall be deemed to have chosen option (b) above.
INTERIM FINANCING
All equipment schedules under this proposal will commence on the first day of the monUl. If Lessee so
requests, subj~t to Lessor's approval. Lessor will advance payments to vendors and manufacturers <In 8 day
oilier than the 11ts1 day of lhe month. Interim Rent will be payable on the amount fund~. icom the date of
acceptance of equipment to the day of lease cOnltn.encemenL, which period shall not e~ceed 30 days. Interim
Rent will be calculated as an amount equal to a rate per day equal to 1/360th of tJlC Prime Rale, times Ole
number of days prior to the lease closing date. As used hereiu, tbe "Prime Rate" shall mean the Prime Rate
published from time to time in The Wall Street Journal. The Interim Rent payment will be due on the day on
which Lessor advances funds to tl\e vendor ot'manufacturer.
EARLY CANCELLATION RIGHTS
Subject to certain notice and absence of default provisions, on a date wlUch is 84 monlhs after ale Rent
Commencement Date, Lessee shall have the option to purchase the Equipment for an early buyout price equal
to 30.12% oftbe Equipment Cost. The foregoing opLion will not adversely affect Lessor's tax treannent ortlle
uansaction.
NET LEASE
The :Lease will be 3 noncancellable, net lease transaction whct'cbY insW'81lce, maintenance, and all applicable
taxes (including sales andloruse ta.xes, which wiU be added 10 the cost of the Equipment or collected on tlle
gross reni.als, as appropriate under the laws of the particular state) are the responsibility of the Lessee. Lessor
will make no warranties, ex:pressed or implied, relating to the Equipment.
INSURANCE
Lessee wiU provide adequate pcoperty and liability insurance with endorsements and in M10l.UllS acceptable 10
Lessor prior to tlle delivery of the Equipment. Lessor will be named as first toss payee under such property
insurance policies and as an additional insured under such liability policies.
DOCUMENTATION FEE
At lease erosing, Lessee shall pay to Lessor a documentation fee equal to $750,00, plus all fees and
disbursements (including attorney's fees) actually incwred by Lessor to secure a lien and/or negotiate
documentation.
RESIDUAL EVALUATION
This proposal is subject 10 Lessor's residual evaluation. The Rental Amounts (and other economic factors) set
forth herein may need to be adjusted in accordance with differences between tl\e actual residual values and the
residual "aluos contemplated by this proposal.
APPLICATION DEPOSIT
Lessee shall forward to Lessor an application deposit equal to $5,000.00 with this signed proposal in
considetaliol1 of Lessor's transaction structuring and review activities. In the event that Lessor does not
approve this lransaction, this application deposit (less the cost of any out-or.pocket ell.'J>CIlSCs incurred by
uvr-;U-Uj MUN ~; UL YM UY hlJU HMhrrH IN HX NU. ~~L ~41 bjj~ Y. ~
Lessor such as appraisal fees~ lien searches, legal fccs~ etc.) shall bo retunled to Lessw. In 1he event tlIat OIis
transaction closes, this application deposit shall be applied on a pro tata basis to reduce the first Rental
Payment. In aU oilier events, this application deposit may be retained by Lessor.
MISCELLANEOUS
SAl,ES TAX EXJi:MPTION
" "
Many companies are exempt from sales and/or use tax. For Lessor to qualify for Lessf;t's sales tax exemption,
a valid tax exemption certificate, satisfactory in all respects to Lessor, for the state where the Equipmct1l will
" be located will be required at lease closing.
TAX ASSUMPTIONS
This proposal assumes that (1) Lessor will be considered owner for Federal" income tax pUlJlOses, (.2) ale
equipment is 7 years MACRS property, and (3) the maximum available depreciation deductions on the full
amount of Lessor's capitalized cost of equipment are available to Lessor. Lessee warrants and represents to
Lessor that the item (2) above is true and accurate.
This proposal assumes that the transaction described herein is eligible for certain benefits ('Benefits") of
Public Law No; 107-147 (the Job Creation and WoIker Assistance Act of 2002); Iffor any reason Lessor
determines that the transaction is flot eligible for such Benefits, the pricing contained heteio shall be modified
accordingly.
FINANCIAL STATEMENTS
Lessee shall furnish Lessor with its frnancial statements, in a form satisfactoJ)' to Lessor, for the last three
fiscal years and latest interimfinanc:ial statements. Lessee s~all also provide the name of its major bank. and
the address, phone number and account officer name.
PROPOSAL ACCEPT ANCE/EXPIRA TION
This proposal is subject to approval by the Lessee on or before October 31, 2003. Unless this date is extend~.d
in writing by Lessor, if Lessor has not received a COP}' of this proposal, signed by Lessee, on or before such
date, this proposal will expire.
CHANGE IN TAX LAW
The Rent Amount, and all other economic factors wbich are part of this proposal, will be adjusted before each
lease closing to reflect any changes in the Internal Revenue Code of 1986 (the "Code") or its regulations (as
compared to the Code and its regulations as in effect on OCtober 27, 2003), which is enacted on or before each
such lease closing (including changes relating to the tax rate applicable to Lessor or its affiliates), ol.l1er tllan
changes tegarding investment tax credits. These adjustments will be calculated to preserve Lessor's (or its
affiliates) expected after-tax yield.
Notwithstanding the above, obligations of Lessor (or its affiliates) to fund each lease closing will be subject to
no actual, pending or proposed change in tax law having occurred tha~ in LessoJ:'s opinion, might adversely
affect it or its affiliates.
ucr-n-Uj MUN 8:UL PM KEYEQUIPMENHIN F AX NO, 952 841 6335 p, 6
your CPA andlor ta~ advisor. LESSOR HAS NOT MADE, AND HEREBY DISCLAIMS ANY ADVICE,
REPRESENtATIONS, WARRANTIES AND COVENANTS, EITHER. EXPRESSED OR IMPLIED, WITH
RESPECT TO THE LEGAL, ECONOMIC. ACCOUNTlNG, TAX AND/OR OTHER EFFECTS OF mE
LEASE ANo.:rug TR..ANSACllONS. CONmMP.LA'lliD- THEREBY.
This proposal is subject to the formal approval of .Lessor, a Division of Key Corporate capital Inc. (a!1d1or
assignee) and the execution of documentation acceptable to Lessee and Lessor. IT SHOULD NOT BE
CONSTRUED AS A COMMITMENt BY LESSOR TO ENGACE IN THIS FINANCING.
This proposal is issued in reliance upon the accuracy of all infonnatioo, teptcsentations and exbibils presented
by Lessee to Lessor and is also contingent upon the absence of any material adverse change in tbe Equipment
or Lessee's condition, finandal or otherwise, from the condition as it was represented to Lessor at (be time of
tlus proposal.
If the foregoing meets with your approval, please slgn the encJosed copy and return i~ together with the
Application Deposit, to Lessor on or before the proposal Expiration Dale set forth above, OUT receipt of such
SigllCd copy and the Application Deposit will constitute )'our application for consideration by Lessor for (he
fmancing summarized in this proposal.
Thank you for: allowing us lb.e opportunity to present tftis Proposal. If you have any quc$tions, please call me.
819521841-6334.
IMPORTANT INFORMATION ABOUT PROCEDURES FOR Al'PLYING FOR FINANCING WITa
US
To belp the go~emment fight the funding of terrorism and money laundering activities, federal. law requires US
to obtain, verify, and r:ecm:d information that identifies each customer who opens an account or applies {or
financi.og. Therefore, all new and existing customers are subject to the identity verification requirements,
When. a customer applies for financing wilh us, we will ask for the customer's namel address and identification
number, an.d,. in jhe ca~ Df 3I'I indiv.idual, his or her.date of binb. For business acc.oun(s. we may also obtain
thls information for individuals associated with. the business. We maya.lso request to see a drh'erts license or
other identifying.4ocuments. In all cases, we are committed to protecting tIle privacy and identily of each of
our cusloxners..
Vet)' tJ:Uly yours,
t Financel a Division of Key COlpOrate Capital Inc,
Dislrict Mcinager
APPROVED THIS Jo DAY OF O~1lfCv- 19 OJ'
-.... !..-
Cballenge Printing me
By: /;(~) (ro
~ame; .
ide:
Federal Tax: ID: f//- /~ (2/(J~
l(JJ. . .::. ( ~t<:t:U H1'lt:.I'<H..H::'. INl... ? '::Jl'::J~~'::J4~1d':J't.j NO. 948 ~12l2
"""'" .c,u' IU"t
- -
Creo Americas, Inc. I T, +1,OOQ,713.4400 I WWW.creCl,c:om I Cre,a
c/O Qreo Inc, F. +1.630.m.0950
1100 Arfington Heights Roact, frOfa~ f( '~1 r'N'-t1!\.-;-
SUite120
lwca, IL 60143 J-.- ^ ,!"s' (/J~ 11 Ie- f~ a(\e...futA \
June 28, 3004
VIA FACSIMIL.E TRANSMISSION
Mr. Chn.s Lehan
Challe,Mae Printing, Inc,
7500 Golden Trl4nalll Drive
Eden Ptaltle, MN 55344
Subject: CONTRACT CLARlFIOATION
Dear Mr. Lehan,
ehall&nga Printing, Inc. mceotly slgnec:llltOI.l$tomer Agreement dated 06/07/2004, (the "Agreement") and submitted a
01'10 Americas Ordor FolT\'1 0$107/2004. (the POrder") to Oreo Americas, Inc, ("Creo Americas'?, In connection with this
Order, I would tlke to e1QrllY the followlng Information:
1. PleQe conti"" the 'oRowlng ele. the legal name of your company: Challenge Printing. '"c.
2. Challenge Printing, Inc. has <<greed to pay -the Grand Tota! In the Prlclng Summary of $599,591.00.
Kind')' sign the Pricing Summary Clnd this ContrElQt OlarltlcatlQI1 L.etter on behalf of Chaflonee Printing. Inc. end fax e
COP1' beet< to me today, confltmlng your liIQl'eement to the above to FAX 630.773-0950.
Please Fed Ex both of the original aigned pli'tges to me l!lt 11 OQ Mlngton Helghtl3 Road, Suite 120 in Ita$CQ. II. $014$.
Our Fed Ex AQCQl.lnt NloImber Is 1805-1475-9.
Thank you 4fery much for your prompt attention to this matter and for your continued confldcmce 1" Creo Americas. If
you have any questions or if I CCln be of ft.1l1her 8ssletanoo. please GO not hesitate to contact me at 63G-n3-44UO.
Sincerely yours,
CReo AMERICAS, 'NC.
SylVia Davis
Regiol'\al Oontract Administrator
A~pted and agreed t~ on this 2!i day of June 2004.
::u.~~
Tltl&:~ /?(fS;t('bE~r
P. .. ~"'"'-> Ia~:':~'( L..l'<t:.U H'Y'I:,l'<H.H:il iNC. ~ '::Il'.:r.:>G'::l4~'::l't.;S NO. 948 ~03
" ~
7'
eRl~r,lG SUMMAJiY.
PartNo PrcdUQt Descrlatiol1 f!:!e!! .9!! ~ Price
01S-0010lA-OS Magnus 6383 S speed 2400dpl, Engine Only $3~,OOO 1 $320,coO '
01S-00101A-2D Factory Installed - Preml~m aptlon fer MagnuS VI.F $00,000 i $60,000
01S-00101A-21 Factory Installed. V speed Option for Magn~$ VLF S ltpeed $125,000 1 $123,000
015.00101A-26 Factory Installed. Continuous load optIon with Right eject $40,000 1 $4I),OGO
01S-00101,A-23 Fac:tory Installed - Dual plate option: Standard pin $40,000 1 $40,000
18D Field Installed - Multi-Cassette Unit (MCU) option with Right $120,000 1 $120,000
01S-0021SA liriSque tmpos~ Expre$s quad ' $90,000 ' 1 $9.0,000
01S-00379A' TSP7S to TSP7S Uni Tl'lilda-up $1,200 .2 $2,400
015-0038?A Atf<fltlOnal 'fG13 l"Jemory For Bl'lSQue express Quad $3,200 1 $3,200
SOlR44938 Additional :256MS RAM for Brlsque Or Srlsqui Server SOQO $lS0 12 $2.,160
5011\49861 Staccato 10 (for Brlsque V4.x) $15,000 1 $lS,QOO
01$-00024A.' Staccato 10 (for BrlS(lue V4.x) Additional License per Outr)ut $5,000 2 $1~o-;OOO
50-1'1688 "" Page Mutt/Proof Spare Cassette for SpectrlJm $2,000 2 $4/000
50-1469B '8 Page MultlProofSpare Cassette for Spectrum $3,000 2 $6,000
.._._..\,I._W
I~TA.I:!J' WA'AIlA'N'tV INFCIIM40Tl<ltl
IlURINO 'Il41! WAIIIWIT'I PlI'lHlD, 0"10 A&t!RtJ GHA~1.. IN rrs DtB~RIi'rmN. PRRO~1i Tl!1,fl'PlflJl,jl! 8lJ~POIlf !'ROM (I:0Cl A.M. 'l'i~ '.111- UXIAi. TIllE ID4t"l" 'IIIllOUGIl "BDAY.
eltcUl IN~ 1I0000tJllYi> AND ~TI! lSUP,.OR ~OR ClUAul'VtlQ I'IlQOlIlrrGI'R 8:0Q t.I. 1tI G:lIQ P Laa,t,1. Tlr.te M e TH OIl fAlp,II.'I' IlXDI.UDIIlG HaJru.~.
1l~'~AUl"llNG PHalli/me. NlI1Ii1l!RI,lIHJ;D 'I' DIlED AI.IQI\IOAS. t114Y OJ! DlUMfl 70 ~Iill'l AMJ;R1C""'~R 6E1lVlCa, AT ~~I\~ IfWllHBIl. fDIl.ll'J!S If A~ Me
IfAWAII.l.QC:l\l.l'lMIlCl<\Al.l~PAel~TU4i. ' '
.
~OTAL PRICE & LICENSE r...er;
Osscrlptlon of Goods SUD Total I fBEno.oO'
Creo DiSC>>LIflt L._.J2'" ,900.001
Sub Total L $59.6.860.0"
Shipping I S3.731.OlI/
m Date Prepared, Grand Total I $S&s.!!YI!I
CUstomer Signature Date 7-j--t? r
f
'"feel To; CI'IIUI'"eO Prlnllnll PIl~8 ProP4radl Im:za04 . i>i<"~;';"P.;'~" 'j f101l0 Numoer. t2
I.... ..... ... .... . .
Creo Americas, Inc.,
creo' a Washington corporation having its principal business address
at 3 Federal Street, Billerica, Massachusetts, USA 01821.
Telephone (978}439-7000 Fax (978)439-7031
CREO AMERICAS, INC. ORDER FORM Date: 6/7/2004
The tenns of the Customer Relationship Agreement, No.6/7/04 between Creo Americas Inc. and the Customer shall govern
this Order.
1. CUSTOMER 5. PAYMENT TERMS % Amount(US$)
Full Legal Name Challenge Printing Deposit due on submission of order 10% $59,959.10
Jurisdiction of Due Prior to Shipment 80% $479,672.80
Incorporation Upon Completion of Installation 10% $59,959.10
Principal Business 7~00 Golden Triangle Drive
Address Eden Prairie
MN 55344 .
Telephone 952-942-7086 I Fax I 952-942-0973. TOTAL PRICE & LICENSE FEE (US $)
$599,591.00
2. BILL TO 6. SHIPPING & DELIVERY
Challenge Printing Requested Ship ASAP
FuR Legal Name Date
7500 Golden Triangle Drive Full Legal Name Challenge Printing
Address
Eden Prairie 7500 Golden Triangle Drive
MN 55344
Shipping Address
Eden Prairie
Contact Name Chris Lehan Minnesota 55344
I Fax 1952-942-0973 ' '
Telephone 952-942-7086 Contact Name Chris Lehan
Telephone 952.942-7086 I Fax 1952-942-0973
3. EXEMPTION FROM TAX
Sales Tax Statu /g] Taxable ~ Exempt
Sales Tax Registration Number 7. ATTACHMENTS
-If you are an exempt purchaser, please provide a copy ofyol.lr exemption ~
certificate covering all YOl.lr pl.lrchase orders, and attach to this order If Special Provisions Addendum is attached check here
form. If Beta Addendum is attached check here IQJ
_ If you are unable to provide a blanket reseller certificate, a resale certificate
at time of sale. or an exemption certificate. you will be billed for State Sales Miscellaneous Documents IQJ
Taxes as applicable at the time of sale.
4. SALES REPRESENTATIVE
Name David Sinner
Mobile 612-816-1199
Telephone 612-816-1199 I Fax I 952-443-3271
Presented To: Challenge Printing Date Prepared: 617/2004 Page Number: 1
PRICING SUMMARY
Part No Product Description. ~ ~ Total Price
015-00l0lA-08 Magnus 6383 S speed 2400dpi, Engine Only $320,000 1 $320,000
015-00l01A-20 FactorY Installed - Premium option for Magnus VLf $60,000 1 $60,000
015-00101A-21 Factory Installed - V speed Option for Magnus VLF S speed $125,000 1 $125,000
015-0010lA-26 Factory Installed - Cbntinuous Load option with Right eject $40,000 1 $40,000
015-00101A-23 Factory Installed - Dual plate option: Standard pin $40,000 1 $40,000
TBD Field Installed - Multi-Cassette Unit (MCU) option with Right $120,000 1 $120,000
015-00275A Brisque Impose Express Quad $90,000 1 $90,000
015-Q0379A TSP75 to TSP75 Uni Trade-up $1,200 2 $2,400
015-Q0387A Additional 4GB Memory For Brisque Express Quad $3,200 1 $3,200
501R44938 Additional 256MB RAM for Brisque or Brisque Server 5000 $180 12 $2,160
501R49861 Staccato 10 (for Brlsque V4.x) $15,000 1 $15,000
015-00024A Staccato 10 (for Brlsque V4.x) Additional license per Output $5,000 2 $10,000
50-1468B 4 Page MultiProof Spare Cassette for Spectrum $2,000 2 $4,000
50-1469B 8 Page MultiProof Spare Cassette for Spectrum $3,000 2 $6,000
IMPORTANT WARRANTY INFORMAnoN
DURING 11iE WARRANlY PERIOD. CREO AMERICAS SHAll. IN ITS OlSCRETlON. PROVIDE TElEPHONE SUPPORT FROM 8:00 A.M. TO 9:00 P.M, LOCAL TIME MONDAY 11iROUGII FRIDAY.
EXCLUDING HOUDAYS AND ON.srrE SUPPORT FOR QJAllFYtlG PRODUCTS FROM 8:00 AM. TO 5:00 P.M, LOCAL TIME MONDAY THROUGH FRIDAY EXCLUDiNG HOUDAYS.
NON-ClUALlF'llNG PRODUCTS. AS DETERMINED BY CREO AMERICAS. MAY BE DElIVERED TO CREO AMERICAS FOR SERVICE, AT CUSTOMER'S EXPENSE. FOR SITES N M.ASKA AND
HAWAR, LOCAL TIME SHALL MEAN PACIFIC TIME.
TOTAL PRICE & LICENSE FEE
Description of Goods Sub Total I . $837.760.0Q
Creo Discount i $241,900.00\
Sub Total I 5595.860.0Q
Shipping I $3,731.001
Description of Goods and Pricing are valid for 90 days from Dlilte Prepared. Grand Total I $599.591.0Q
Customer Signature Date
Date Prepared: 6/7/2004 f'----..--........--, Page Number: 12
Presented To: Challenge Printing i_~~~_~_!...~-1
DESCRIPTION OF GOODS
Part No Description ~ illY. Total Price
015-00101A-08 Magnus 6383 S speed 2400dpi, Engine Only $320,000 1 $320,000
Description:
The Creo Magnus 6383 is a semi-automatic, very large fonnat
platesetter that uses thermal imaging technology to expose plates for
conventional and waterless printing. Minimum plate size: 19.3"x15.5"
(490x394mm). Maximum piate size: 63"x83" (1600mmx2108mm).
Thjs device comes equipped with a standard S speed 2400dpi
resolution imaging head. Imaging speed is up to 203 mmfmin (8
inchesfmin) depending media sensitivity (refer to specific media
qualifications ).
Includes:
Trendsetter 6383 Perfonnance S semi-automatic platesetter
-2400dpi S Speed imaging
-Dynamic Auto-focus
-Semi-automatic media loading and unloading
-Automatic registration
-Automatic clamping
-Electronic registration confirmation
-Debris removal
Notes:
Status: Early Production
Support: {Per Month) 13x5: $2450
On-Site Installation:
Additional Training:
Specification Doc(s):
015-00101A-20 Factory Installed - Premium option for Magnus VLF $60,000 1 $60,000
Description:
The Premium Imaging option uses SQUAREspot thennal imaging
technology. Premium machines include Staccato FM Screening
(20um), temperature compensation and guaranteed machine to
machine accuracy. Only available on devices with 2400dpi and
2540dpi resolution imaging heads.
Includes:
Factory Installed - Premium SQUAREspotlmaging option
-Temperature Compensation
-Machine to machine accuracy
-SQUAREspot Thermal Imaging Head - 2400f2540dpi
_~ ~nppti im~nint1 .
Presented To: Challenge Printing Date Prepared: SrTf2004 Page Number: 2
DESCRIPTION OF GOODS
Part No Description ~ ~ Total Price
-S Speed imaging
-Dynamic Auto-focus
-Semi-automatic flledia loading and unloading
-Automatic registration
-Automatic clamping
-Electronic registration confirmation
-Staccato 20 Series (Only included with Brisque 4.x and Prinergy.
Requires Quantum class device control kit.)
Notes:
Status: Early Production
Support: (Per Month) 13x5: $501.2
On-Site Installation:
Additional Training:
Specification Doc(s):
. 015-00101A-21 Factory Installed - V speed Option for Magnus VLF S speed $125,000 1 $125,000
Description:
The V speed option increases the device imaging speed from
standard S speed to V speed. The V speed head images up to 1010
mm/min (39.8 inches/min) depending on format size and media
sensitivity (refer to specific media qualifications).
Includes:
Includes internal chiller and debris removal
Notes:
Status: Early Production
Support: (Per Month) 13x5: $851.2
On-Site Installation:
Additional Training:
Specification Doc(s):
015-001 01 A-26 Factory Installed - Continuous Load option with Right eject $40,000 1 $40,000
Description:
The Continuous Load option adds plate-handling automation to the
Magnus VLF devices. It allows an operator to stage a plate on the
IO;:ln t;:lOIA whilA ;:InothAr ol::ltA i!': im::roino thp.rAhv rAnudno OOAr::ltor
Presented To: Challenge Prlntlng Date Prepared: 6f712004 Page Number: 3
DESCRIPnON OF GOODS
Part No Description ~ ~ Total Price
loa~ table while another plate is imaging, thereby reducing operator
interventions. The imaged plate is automatically unloaded and ejected
to the side of the machine. A plate rotator comes as a standard
feature with this automation. The Continuous Load option is included
on MCU based machines.
Includes:
Includes plate rotator on unload table.
Notes:
Status: Early Production
Support: (Per Month) 13x5: $593.6
On-Site Installation:
Additional Training:
SpecificationDoc(s):
015-00101A-23 Factory Installed - Dual plate option: Standard pin registration $40,000 1 $40,000
Description:
The Dua!lPortrait options allows for loading of 2 plates on the drum
simultaneQusly reducing average machine non-imaging time.
Depending on the plate size and the format size of the machine,
plates can be loaded in either landscape or portrait mode. Plates are
registered using Creo's standard 6 pin register system.
Includes:
Includes standard 6 pin registration system
Notes:
Status: Early Production
Support: (Per Month) 13x5: $280
On-Site Installation:
Additional Training:
Specification Doc(s):
TSD Field Installed - Multi-Cassette Unit (MCU) option with Right eject $120,000 1 $120,000
Description:
The MCU option provides 4 cassette automation. It includes
automatic plate picking, slipsheet removal and plate staging. Exposed
plates are automatically unloaded to a side processor. The MCU is
factory configured for Left or Right side operation to meet end-user
space requirements. MCU cassette capacity is 75 plates for a total of
300 plates online. See product specs for more details
Includes:
Includes plate rotator on unload table.
"'_4.___
Presented To: Challenge Printing Date Prepared: 6m2004 Page Number: 4
DESCRIPTION OF GOODS
Part No Description Price ~ Total Price
Notes:
Statl.ls: Early Production
Support: (Per Month) 13x5: $1220.8 ,
On-Site Installation:
Additional Training:
Specification Doc(s):
015-Q0275A Brisque Impose Express Quad $90,000 1 $90,000
Description:
Brisque Impose Express Quad automates the prepress.workflow
using flexible Job Tickets. It's client-server architecture allows
versatility by initiating tasks from any Macintosh or PC workstation.
An intuitive, icon-driven, graphic user interface offers full control over
many processes, including preflight, RIPing, or automatic picture
replacement (APRlOPI). Automating tasks with preset parameters
assures predictability and reduces the opportunity for errors. Brisque
Impose includes PressTouch and FAF trapping for smooth and
efficient production. Brisque Impose also includes page independent
"Just in Time" impositioning, with full control and management of
impositioned flats. The Brisque workflow combines the security and
reliability of the CT/LW workflow with advanced PDF capabilities.
Adobe Extreme technology is included for PDF nonnalizing and
preflighting, PDF exporting. Brisque Impose Express Quad is a
4-CPU Brisque, with RIP, trap, Iris page proof, Digital Blueline Proof
option and imposition capabilities allowing for simultaneous
operations.
NOTE: Connectivity kit is required to drive CTP or CTF device.
Vector trapping and various output formats may be added as optional
items.
Includes:
Brisque Impose Express Quad (pSeries 630 Model6E4) Workflow
System
- Symmetric Multiprocessing (SMP)
- 4 x 1.45GHz Power4+ Processor
- 4GB RAM
-.1 x 36GB system disk
- 2 x 73GB user disk
- 4 free slots
- 1 free disk bay
- IDE CD-ROM
- Floppy drive
- 2 Ethemet 100BaseT (on board)
- 1 Gigabit board
-15" LCD Display
_ Creo/Adobe1l.l CPSI PostScript1l.l & Extreme PDF RIP on Brisque
- Brisque based imposition software
_ Creo Full Auto Frame1l.l trapping s/w on Brisque
_ Helios License for 6 simultaneous clients
_ Creo PressTouch slw for Macintosh w/trapping included
_ No Brisque training included with standalone unit.
_ Rri,::nw::'1l.I ()np~tnr J:lnrllmnn,::p tr::lininn,:: ::It r.rpn Tr::lininn 1=::Ir.i1it\l
Presented To: Challenge Printing Dale Prepared: 6fT/2004 Page Number: 5
DESCRIPTION OF GOODS
Part No Description ftlE2 !lli Total Price
Notes:
(a) Additional copies of Creo PressTouch and FAF, if desired, must
be purchased separately.
(b) Creo Brisque comes with six (6) Helios Licenses. Additional
licenses are available at additional cost.
(d) For PC connectivity purchase Microsoft Services For UNIX
(630P70221A).
(d) Additional 18GB -7200RPM (501R44797) and 36GB -7200RPM
(501 R49496) disk drives are available at extra cost
(e) Additional Japanese Font Support for Brisque (either 501 R49673
or 501 R49943) must be bundled if the system is sold to Japan.
_ TRAINING NOTE: Basic Brisque training is included in the
Connectivity Kit, standalone Brisques receive no training.
Status: Beta
Support: (Per Month) 13x5: $900
On-Site Installation:
Additional Training:
Specification Doc(s):
o 15-00379A TSP75 to TSP75 Uni Trade-up $1,200 2 $2,400
Description:
TSP 75 uni supports the lastest Brisque Express series for
connecting to Creo output devices. This is an upgrade for existing
customers who have TSP75 today and would like to upgrade their
Brisque hardware to anyone of the Express hardware platform.
. Includes:
TSP 75 uni board.
Presented To: Challenge Printing Date Prepared: 6f7f2004 Page Number: 6
DESCRIPTION OF .GOODS
Part No Description Price 9!Y Total Price
Notes:
_ This is suitable for customers who trade up their EJrisque hardware
platform to the Brisque Express Series, or for PS/M customers who
use G5 Macintosh computer.
_ Brisque v5 or above is required, or PS/M 8 or .above is required.
_ For QuantumN speed customers, there is a need to order two
boards for the upgrade.
_ EXisting TSP75 board(s) should be returned to Creo.
_ This product is released to Early Production for PS/M 8.0.
Status: Beta
Support: (Per Month) 13x5: $0
On-Site Installation:500
Additional Training:
Specification Doc(s}:
015-00387A Additional 4GB Memory For Brisque Express Quad $3,200 1 $3,200
Description:
Additional 4GB RAM for the Brisque Express (6E4) Quad platfonn.
Includes:
- Eight (8) 512MB RAM DIMMs, 8ns
_ Installation charges are not included
_ Installation available through Creo Support Services at an additional
cost of $501
Notes:
This is suitable for Brisque Express Quad configuration only
(6E4-4ways).
StatuS: Beta
support: (Per Month) 13x::i; ~32
On-Site Installation:500
Additional Training:
Specification Doc(s}:
501R44938 Additional 256MB RAM for Brisque or Brisque Server 5000 (F50) $180 12 $2,160
Description:
Additional 256MB RAM for the Brisque2 , Brisque4 and Server 5000
(F50)
Includes:
,,_ Two (2) 128MB RAM DIMMs
_ Installation Charges are not included
_ Installation available through Creo Support Services at an additional
cost.
...... .
Presented To: Challenge Prlntlng Date Prepared: 6f712004 Page Number: 7
DESCRIPTION OF GOODS
Part No Description ~. 9!Y. Total Price
Notes:
". The maximum RAM for F50 is 3GB of RAM
_ Thil) upgrade may require an' additional memory card for the F50
(pIn 605800470)."
_ This product must be sold through Inside Creo. sales at (800)
929-9209 unless part of a configuration.
Status: Full Production '.
Support: (Per Month) 13x5: $0
On-Site Installation:500'
Additional Training:
Specification Doc{s):
501 R49861 Staccato 10 (for Brisque V4.x) $15,000 1 $15,000
Description:
Staccato 10 screens for Brisque v4. Includes Staccato 10, 20.1, 20,
25, 35; 36, 40 and 70. Also included is the Staccato Self Paced
Training CD's'" "Planning, Implementing and Managing Staccato"
634-00181A prepresstraining kit and 634-00182A pressroom training
kit.
Includes: . .
installation of Staccato Licens~ Key, relevant softWare upgrades,
documentation, and configuration of workflow to support Staccato.
Staccato includes a database of predefined. calibration curves but
does not include assistance in building custom calibration curves.
~Creo will maintain image quality to specifications but is not
responsible for Correcting density and dot area variations related to
media and processing. Where required, customers are responsible for
linearizing their old to correct variation in dot areas. Process
variations on entry-level CtP devices will require customers to monitor
and linearize Staccato plates on a regular basis.
***See Product Specifications for further details.
Notes:
Qualified Media Requirements - Only Western Utho L T-2; KPG
ExThermo L T -3 and Fuji LH-PI are qualified for use with Staccato 10
screening. KPG Thermal Gold and Spectratech 830-n are in Early
Production qualification with Staccato 10 and require Product
Manager approval prior to sale when intended to be used with either
of these media - contact Paul Beaumont, Product Manager in Applied
Imaging and Media. Media not listed above are NOT qualified for use
with Staccato 10.
_ Font 10 of the Brisque station is required for the order.
""*ONl Y Available as a CHARGEABLE option on new and old
2400/2540 dpi SQUAREspot devices.
***See applied imaging and media qualification specifications for
rA!>.trir.tinn~ nn whir.h !>.r.rAAn~ ~rA !>.llnnnrtAn nn A~r.h nl::ltA Rnn nmnf
Presented To: Challenge Printing Date Prepared: 6"'2004 Page Number: 8
DESCRIPTION OF GOODS
Part No Description ~ .Q!y Total Price
Status: FullProduction
Support: (Per Month) 13x5: $162.5
On-Site Installation:
Additional Training:
Specification Doc(s): 72-3026C
015-00024A Staccato 10 (for Brisque V4.x) Additional License per Output Device $5,000 2 $10.000
DeScription:
Additional. License: Staccato.1 0 screens for Brisque v4. Includes
staccato 10, 20.1, 20, 25, 35, 36, 40 and 70. Also included is the
Staccato Self Paced Training CD's- "Planning, Implementing and
Managing Staccato" 634-00181A pre press training kit and
.. 634-00182A pressroom training kit
Includes:
Installation of Staccato License Key, relevant software upgrades,
documentation, and configuration of workflow to support Staccato.
Staccato includes a database of predefined calibration curves but
does not include assistance in building custom calibration curves.
***Creo will maintain image quality to specifications but is not
responsible for correcting density and dot area variations related to
media and processing. Where required, customers are responsible for
linearizing their old to correct variation in dot areas. Process
variations on entry-level CtP devices will require customers to monitor
and linearize Staccato plates on a regular basis.
***See Product Specifications for further details.
Notes:
Qualified Media Requirements - Only Western Litho L T -2; KpG
i ExThermo L T-3 and Fuji LH-PI are qualified for use with Staccato 10
screening. KPG Thermal Gold and Spectratech 830-0 are in Early
Production qualification with Staccato 10 and req!Jire ProQuct
Manager approval prior to sale when intended to be used with either
of these media - contact Paul Beaumont, Product Manager in Applied
Imaging and Media. Media not listed above are NOT qualified for use
with Staccato 10.
_ Font 10 of the Brisque station is required for the order.
***ONL Y Available as a CHARGEABLE option on new and old
2400/2540 dpi SQUAREspot devices. ***8ee applied imaging and
media qualification specifications for restrictions on which screens are
supported on each plate and proof media.
Presented To: Challenge Printlng Date Prepared: 6nt2004 Page Number: 9
DESCRIPTION OF GOODS
Part No Description ~ ~ Total Price
Status: Full Production
Support: (Per Month) 13x5: $162~5
On-Site Installation:
Additional Training:
. Specification Doc(s): 72-3026C
50-14688 4 Page MultiProof Spare Cassette for Spectrum $2,000 2 $4,000
Description:
For Imation or Kodak. MultiProof capability allows pre-loading of up to
.3 proof$ of 5 donors each (CMYK plus one spot) and provides up to 2
hours of unattended operation.
InCludes:
Notes:
Proofsetters before PR053, Spectrums before S346 and Heidelberg
Spectrums before 993631305 will need an onsite service visit to
Install.
Installation is charged at regular support rates.
- This product most be sold through Inside Creo sales at (800)
929-9209 unless part of a configuration.
Status: Full Production
Support: (Per Month) 13x5:
On-Site Installation:
Additional Training:
Specification Doc(s):
50-1469B 8 Page MultiProof Spare Cassette for Spectrum $3,000 2 $6,000
Description:
For Imation or Kodak. MultiProof capability allows pre-loading of up to
3 proofs of 5 donors eaoh (CMYK plus one spot) and provides up to 2
hours of unattended operation.
Includes:
Notes:
Proofsetters before PR053, Spectrums before S346 and Heidelberg
^... .4. ._.. t..'. " ^",^^^"^^I"" ... ...... ... .. ..... ..... .... "0"' ._
Presented To: Challenge Printing Date Prepared: 6f712004 Page Number: 10
DESCRIPTION OF GOODS
Part No . Description ~ 9!i: Total Price
Spectrums before 993631305 will need anonsite service visit to .
install.
Installation is charged at regular support rates.
_ This product must be sold through Inside Creo sales at (800)
929-9209 unless part of a configuration.
Status: Full Production
Support: (Per Month) 13x5:
On-Site Installation:
Addi~onal Training:
Specification Doc(s):
Presented To: Challenge Printing Date Prepared: 6nt2004 Page Number: 11
\..1111"\'................-, ...........-... I
CHECK NO. 11810
100000000062304 06/23/04 60,000.00 60,000.00 .00 60,000.00
Check Total 60,000.00
... . '.,. m ftlE SECUf\ITY FE!ATU'R!l$ OM ttll~'~a(;uMJi!NJ INOLUDE: ~'Jill.,ijE QA'CKIaRPuIllD, f1L$:D TtlRO'UGH MI, .l'!ING~N,~:A:~li?i:i,o~j:ji~t.:s.i~~~tq~~\,~~f~<i~:..:. :;,....., ".; .::.J
('-Wi
1110 . . a ~ 0 III I.~O 11 211 0... 5 5....: * 500 BOb b ? 3 ?... nl
,.......
SOURCE AND USE STATEMENT (page 1)
MIF Bank{s) Equity City Other* Total
$1.15M $10.35M $11.5M
Property Acquisition
$.6M $5.2M $5.8M
Site Improvement
New Construction
Renovation of an
Existing Building
Purchase of Machinery & $A4M $.16M $6.8M $7 AM
Equipment
*1 nfrastructure
Other
(Define)
Total project costs $.44M $1.91M $22.35M $24.7M
*Complete page 2
*Other is American Family or an insurance company for the building and Key Equipment Finance for the purchase of
the M&E.
7 years 15yrs 15 yrs
Terms (years) 8 yrs
2% 6.25% 6.4%
Interest Rate
Lien Position
Magnus Building Building &
Collateral Platesetter Equip.
Personal Guarantee=s are required as a condition of the MIF loan.
S-15
SOURCE AND USE STATEMENT (page 2)
Infrastructure Activity
MIF Other Total
Sanitary Sewer
Storm Sewer
Streets
Water
Engineering
Total Infrastructure
Costs
S-16
EMPLOYMENT DATA FORM
Business Name_Challenge Printing, Inc.
Current Employment (Permanent, full-time equivalent) at project location: _380 state wide: _380
Jobs To Be Created: (PERMANENT ONLY)
Benefits (Yes or No)
# of Annual Hourly Rate Hourly Value Hiring Health Life Dental
POSITION TITLE Jobs Hours * W /0 Benefits Benefits ** Date Insurance Insurance Insurance Retirement Other
Sales Reps 3 2080 $28.8 $3.5 Var. Y Y Y N 401K
Customer Serv. Rep 2 2080 $16.8 $2.0 Var. y Y y N 401K
Building Maintenance 2 2080 $15.0 $1.8 Var. y Y Y N 401K
Estimators 2 2080 $19.2 $2.3 Var Y Y y N 401K
Job Planners 2 2080 $15.5 $1.9 Var Y y Y N 401K
Laminating Operators 4 2080 $18 $2.2 Var Y y Y N 401K
Warehouse Worker 1 2080 $15.0 $1.8 Var. Y y y N 401K
Press Operators 14 2080 $25 $3.0 Var. Y Y Y N 401K
Press 14 2080 $16.5 $2.0 Var. Y Y y N 401K
Helpers/Feeders
EPP operators 4 2080 $24 $2.9 Var. Y Y Y N 401K
Kitting/HB 4 2080 $14.5 $1.7 Var. Y Y y N 401K
MB operators 3 2080 $18.0 $2.2 Var. y Y y N 401K
Quality Inspector 1 2080 $18.5 $2.2 Var. y y y N 401K
.
Shipping 1 2080 $15.0 $1.8 Var. Y y Y N 401K
PMC DC Operators 4 2080 $17.0 $2.0 Var. Y Y Y N 401K
PMC DC Helpers 4 2080 $14.5 $1.7 Var. y y y N 401K
S-17
Bobst Operators 4 2080 $21.0 $2.5 Var. Y Y Y N 401K
Jumbo DC Operators 4 2080 $19.0 $2.3 Var. Y Y Y N 401K
DC Helpers/Support 6 2080 $14.5 $1.7 Var. Y Y Y N 401K
Folding & Glue Oper 1 2080 $20.0 $2.4 Var. Y y y N 401K
Total jobs to be Created _80 Average hourly Wage $ _17.5 Average hourly benefit $_2.2
* Part-time positions are converted to full-time equivalent with full-time equivalent representing 2,080 hours annually.
** This hourly compensation should include employer=s benefits to the employee. Social security tax, unemployment insurance, workers compensation insurance and
other benefits mandated by law MUST BE EXCLUDED.
Per State Law governing the Minnesota Investment Fund Program, the total compensation including base wage and benefits must be at least 110% of the federal poverty
income level for a family of four ($9.73 per hour effective 7/1/03). However, to determine eligibility, all new jobs pertaining to the expansion must have a base pay, exclusive of
benefits, of at least $9.00 per hour in Greater Minnesota and $12.00 per hour in the Seven County Twin Cities Metro area.
Certification:
I, ,certify that the employment information is true and accurate.
(CEO/PRESIDENT)
S-18
BUSINESS DOCUMENTATION:
PROVIDE THE FOllOWING:
FINANCIAL DATA
.. j'
9 VHistorical - Company financial statements for the past three fiscal years, including balance sheets, income
statements, details on existing debt agreements, statements of changes in financial position, and
notes to financial statements. If these financial statements are un-audited, they must be dated and
signed by an authorized officer of the company. If the historical documents are more than 90 days
old, provide interim data or provide Year-End Audit - The current year-end audit or the previous two
year=s audits. Financial statements will be accepted if the audits are not available.
.. / / j ,/
9 L/Projected - Performa balance sheets, income statements and cash flow statements for the ~ two years and
explanation of assumptions. The documents should be prepared including the amount of your
funding request to the Business and Community Development Division.
I
9 v' Personal Financial Statement - For all owners, guarantors and stockholders that are required to personally
guarantee a loan (see attachment). t?'1u / I:J.
- /' I
9 Collateral - A description of proposed CO;i"ral. Not applicable for infrastructure projects~ uea '''" {,..,ci)
9 Aging of Accounts Receivable/Payable - A summary of accounts receivable and accounts payable dated as of
i the most recent balance sheet submitted with this application.
9 JBusiness Debt Schedule - (see attachment).
COST ESTIMATES
9 Architectural or engineering reports for construction projects.
9 Appraisals for purchasing real estate, buildings, used machinery or equipment.
9 Price quotations from vendors for the purchase of new equipment.
OTHER
9 ~anagement Resumes - Personal resumes detailing current and past positions with the company; applicable
professional and technical experience; and their educational background.
9 Corporate Documents - A copy of the company=s Articles of Incorporation, Certificate of Good Standing, and
By-Laws.
9 Business Plan
9 Commitment letters from all sources of financing.
S-19
Jul 13, 2004 - 5:22pm
Challenge Printing Inc
Balance Sheet
CONSOLIDATED OPERATIONS
Year-To-Date As /
06/30/2004
Assets
Current Assets
Cash in Checking (761,425.38)
------------------
Total Cash on Hand (761,425.38)
Accounts Receivable 12,427,922.09
Accounts Receivable Misc 95,133.06
Allowance-Doubtful Accounts (471,950.22)
Unearned Finance Charges (84,039.97)
------------------
Net Accounts Receivable 11,967,064.96
Sales Tax Refund Receivable 214,585.11
Due from Employees 26,656.40
Deposits 971,322.50
Inventory:
Inventory-Paper 657,572.82
Inventory-Other 1,300,662.65
Inventory-Lettershop Postage 10,567.97
Inventory Reserves (30,000.00)
Inventory-Equipment for Sale 72,514.95
Work In Process 3,069,757.64
------------------
Total Inventory 5,081,076.03
Prepaid Insurance 147,577.75
Prepaid Expenses (General) 18,424.58
------------------
Total Current Assets 17,665,281.95
Non-Current Assets:
A.utomobile 474,224.13
:)ffice Furniture & Equipment 1,041,769.14
Equipment-Production 12,015,648.97
Leasehold Improvements 734,881.34
7490 leasehold improvement 509,915.73
Less Accumulated Depreciation (9,673,403.24)
------------------
Slet Property, Plant, & Equip. 5,103,036.07
Lease Deposits 114,400.50
Jue From Officer 2,737,771.51
~otes Receivable 212,648.72
------------------
rotal Non-Current Assets 8,167,856.80
------------------
,5
Jul 13, 2004 - 5:22pm Challenge Printing Consolidated Operations
Total Assets 25,833,138.75
==================
;.6:
Liabilities
Current Liabilities
Current Portion of LT Debt 600,250.30
Current Portion of Cap lease 26,378.20
Deposits on Equipment Projects 118,440.00
Accounts Payable 2,538,704.55
Accounts Payable Accrual 345,792.85
Veba Payable 134,410.87
Line of Credit Payable 3,700,000.00
------------------
Current Payables 7,463,976.77
Accrued Expenses
Sales Tax Payable-MN (1,384.90)
Use Tax Payable-MN 2,443.65
Sales Tax Payable-Mpls 153.84
Sales Xax Payable-City/County 50.49
AP to AR Clearing (3,937.02)
Accrued Salaries Payable 954,178.37
Accrued Commissions Payable 550,500.00
Accrued Vacation Payable 577,556.21
Accrued Profit Sharing 1,048,719.00
Accrued 401K Match Payable 211,546.00
Real Estate Taxes Payable (278.70)
Accrued Interest Payable 5,198.78
Accrued-Other 1,139,724.31
Customer Deposits 90,390.15
FICA Payable 114,936.97
Federal Tax WH Payable (85.37)
State Tax WH Payable 1,012.61
Unemployment Tax Payable 48,408.34
401 (K) Withholdings Payable (371.31)
Cafeteria Medical WH Payable 17,477.04
Other Payroll WH Payable .01
------------------
Total Accrued Payables 4,756,238.47
------------------
Total Current Liabilities 12,220,215.24
Long-Term Liabilities
Notes Payable 888,451.13
IRB Note Payable 630,000.00
Notes Payable-Current Portion (518,866.30)
Capital Lease-Current Portion (26,378.20)
Deffered Lease Gains '196,742.34
------------------
Total Long-Term Liabilities 1,169,948.97
------------------
Total Liabilities 13,390,164.21
Minority Interest:
Minority Interest in Sub 501,937.72
Shareholders Equity
Capital Stock 1,000.00
Retained Earnings 9,376,366.55
11
Jul 13, 2004 - 5:22pm Challenge Printing Consolidated Operations
YTD Earnings 2,563,670.27
------------------
Total Shareholders Equity 11,941,036.82
------------------
Total Liabilities & Equity 25,833,138.75
==================
sa
Jul 13, 2004 - 5 : 08pm
Challenge Printing Inc . 0\
Income Statement ~. ('-0", S c \ \ cA t\+ ~
Current Month Current Month Current Month Year-fa-Date Year-To-Date Year-To-Date
Actual Budget Variance Actual Budget Variance
Revenue
Sales-Sheetfed Printing 7,407,611 82.94 5,743/882 78.78 1,663,729 28.97 30,631/615 82.86 28,313,357 79.36 2,318,258 8.19
Sales-Flexographic Products 1,104,694 12.37 1,056/231 14.49 48/463 4.59 4,608,968 12,47 5,081,417 14.24 ( 472,449) 9.30-
Equipment Sales Revenue 87,007 ,97 119,152 1.63 (32,145) 26.98- 535/149 1.45 462,461 1.30 72,688 15,72
Freight & Postage Charges 279,447 3.13 334,767 4.59 (55,320) 16.52- 1/114/566 3.01 1,645/461 4.61 (530/895) 32.26-
Other Charges Invoiced 67/382 ,75 74,804 1.03 (7/422) 9.92- 306,954 .83 361,157 1.01 (54,203) 15,01-
Early Payment Discounts (14,472) .16- (37,961) .52- 23,489 61.88 (227/8221 ,62- (187,084) .52- (40,738) 21.78-
-------------- -------------- -------------... -------------- -------------- --------------
Net Sales 8,931,669 100.00 7,290,875 100.00 1,640,794 22.50 36,969/430 100.00 35,676,769 100.00 1,292,661 3.62
Manufacturing Costs
Materials
Materials-Sheet Stock 1,338,030 14.98 1,203,478 16.51 (134,552) 11.18- 6,425,262 17 .38 5,852,829 16.41 (572,433) 9.78-
Other Materials-Sheetfed 503,877 5.64 462,511 6.34 (41,366) 8.94- 2,191,835 5.93 2/280,056 6.39 88,221 3.87
OUtside Services-Sheetfed 1,113,993 12.47 336,301 4.61 (777,692) 231.25- 2,323,623 6,29 1,657/872 4.65 (665/7511 40.16-
Outside Printing-Sheet fed 3,601 .04 185,599 2.55 181,998 98.06 209/235 .57 914,957 2.56 705,722 77.13
Scrap Sales-Sheetfed (7,721) .09- (9,532) .13- (1/811) 19,00- (51,401) .14- (46,988) .13- 4,413 9.39
Purchase Discounts-Sheetfed (38,509) .43- (31/890) .44- 6,619 20.76 (170,430) .46- (157,210) .44- 13,220 8.41
Rebates & Other Crdts-Sheetfed (49,333) .55- (96,743) 1.33- (47,410) 49.01- (445,482) 1.21- ( 476/916) 1. 34- (31,434) 6.59-
Inventory Adjustments-Sheetfed 216,153 2.42 (2/632) .04- (218,7851 ***. ** 85,855 .23 67,027 .19 (18/828) 28.09-
-------------- -------------- -------------- ----------...--- -------------- --------------
Total Materials - Sheetfed Pro 3,080,091 34.49 2,047,092 28.08 (1,032,999) 50.46- 10,568,497 28.59 10/091,627 28.29 (476,870) 4.73-
Materials-Roll Stock 362,168 4.05 337,633 4.63 (24,535) 7.27- 1,442,535 3.90 1,624,570 4.55 182,035 11.21
other Materials-Flexoqraphic 58,492 .65 76,844 1.05 18,352 23.88 331,668 .90 369,739 1.04 38,071 10.30
OUtside Services-Flexographic 2,080 .02 9,737 .13 7,657 78.64 21,822 .06 46,852 .13 25,030 53.42
Purchase Discount-Flexographic (3,132) .04- (3,411l .05- (279) 8.18- (17,731) .05- (16,410) .05- 1,321 8.05
Rebates & other Crdts-Flexo 0 ,00 (1,555) .02- (1,555) ***.** ( 43(270) .12- (7,482) .02- 35,788 478.32
Inventory Adjustments-Flexo (4,034) .05- (4,921) .07- (887) 18.02- 8,598 .02 (23,679) .07- (32,277) 136.31-
-------------- ----...----...---- -------------- -------------- ----------...--- --------------
fotal Materia1s-Flexographic P 415/574 4.65 414,327 5.68 (1,247) .30- 1,743,623 4.72 1,993,590 5.59 249,967 12.54
Equipment Cost of Sales 36,583 .41 75/024 1,03 38/441 51. 24 354,206 .96 291,187 .82 (63,019) 21.64-
-------------- ---------...---- -------------- -------------- -------------- --------------
Total Materials 3,532,248 39.55 2,536,443 34,79 (995,805) 39.26- 12,666,326 34.26 12/376,404 34.69 (289,922) .2.34-
Direct Labor Costs
Direct Labor Wages 990/527 11. 09 1,040,863 14.28 50,336 4.84 4,924,904 13.32 5/289,498 14.83 364,594 6.89
Overtime-Direct Labor 35,148 .39 70,500 .97 35,352 50,14 334,844 .91 366/600 1.03 31,756 8,66.
Benefit Costs 88,085 .99 88,401 1.21 316 .36 442,840 1.20 463,286 1.30 20,446 4.41
Payroll Taxes 86,037 ,96 90,005 1.23 3/968 4.41 481/706 1.30 486,051 1.36 4,345 .89
Contract Labor 37/222 .42 44/201 ,61 6/979 15,79 410,614 1.11 229,841 .64 (180,773) 78.65-
Adjustment for Inventories 15,889 .18 (11,025) .15- (26,914) 244,12- (237,897) .64- (99,394) .28- 138,503 139.35
-------------- -------------- ----...--------- -------------- -------------- --------------
Total Direct Labor 1,252/907 14.03 1,322,945 18.15 70,038 5.29 6,357,011 17.20 6,735,882 18,88 378,871 5.62
Overhead Expenses
Indirect Labor Wages 391/980 4.39 396,364 5,44 4/384 1.11 2,042,436 5.52 2/027,900 5.68 (14,536) .72-
Overtime- Indirect Labor 4,003 ,04 3,410 .05 (593) 17.39- 20,238 ,OS 17,728 ,OS (2/510) 14.16-
Benefi ts Costs 33,574 .38 31,411 .43 (2,163) 6.89- 166,707 .45 164,586 .46 (2,1211 1.29-
Payroll Taxes 30,283 .34 32,253 ,44 1,970 6.11 175,941 .48 179,574 .50 3,633 2.02
11
Jul13, 2004 - 5:08pm Challenge Printing Consolidated Operations Page 1
Factory Insurance 29,854 .33 39,713 .54 9,859 24.83 179,122 .48 206,506 .58 27,384 13,26
Depreciation Charges 133,525 1.49 124,960 1.71 (8,565) 6,85- 692,094 1.87 646,894 1.81 (45,200) 6.99-
Factory Rent 176,107 1.97 178,463 2.45 2,356 1.32 1,068,420 2.89 1,070,775 3.00 2,355 .22
Minor Equipment 542 .01 4,315 .06 3,773 87.44 13,315 .04 22,438 ,06 9,123 40.66
Repairs & Maintenance 82,847 .93 91, 668 1.26 8,821 9.62 335,881 .91 476,676 1.34 140,795 29.54
Supplies 55,063 .62 54,240 .74 (823) 1.52- 292,571 .79 282,053 .79 (10,518) 3.73-
Supplies-Press Blankets 12,773 .14 23,330 .32 10,557 45.25 92,632 .25 121,316 .34 28,684 23.64
Supplies-Press Solutions 8,623 .10 12,566 ,17 3,943 31.38 38,596 .10 65,340 .18 26,744 40,93
Supplies - Internal Produced 6,513 .07 9,562 .13 3,049 31.89 34,257 .09 49,719 .14 15,462 31.10
Factory Equipment Rental 223,308 2.50 223,816 3.07 508 .23 1,225,365 3.31 1,259,752 3.53 34,387 2.73
Factory Utilities 23,497 ,26 25,998 ,36 2,501 9.62 135,723 .37 135,192 .38 (531) .39-
Rubbish & Waste Removal 4,440 .05 8,178 .11 3,738 45.71 31,748 .09 42,520 .12 10,772 25.33
Shipping & Postage 361,632 4.05 317,513 4.35 (44,119) 13.90- 1,133,547 3,07 1,568,942 4.40 435,395 27.75
Employee Education/Training 957 .01 391 .01 (566) 144.76- 9,336 .03 2,030 .01 (7,306) 359.90-
Business Travel & Meals 781 .01 664 .01 (117) 17.62- 1,906 .01 3,448 ,01 1,542 44.72
Communications Expenses 536 .01 585 .01 49 8.38 3,152 . ,01 3,041 .01 (lll) 3.65-
Dues & Publications 0 .00 114 .00 114 ***. ** 3,995 .01 592 .00 (3,403) 574.83-
Auto & Truck Expenses 12,026 .13 7,458 ,10 (4,568.) 61.25- 42, 008 .11 38,780 .11 (3,2281 8.32-
Adjustment for Inventories 139,788 1.57 (8,017) .11- (147,805) ***. ** (609,561) 1.65- (163,267) .46- 446,294 273.35
Internal Job Cost Recovery (13,299) .15- (20,347) .28- (7,048) 34.64- (67,464) .18- (107,058) .30- (39,594) 36.98-
-------------- -------------- -------------- -------------- -------------- --------------
Total Factory Overhead 1,719,353 19,25 1,558,608 21.38 (160,745) 10.31- 7,061,964 19.10 8,115,477 22.75 1,053,513 12.98
-------------- -------------- -------------- -------------- -------------- --------------
Cost of Goods Manufactured 6,504,508 12.83 5,417,996 74.31 (1,086,512) 20.05- 26,085,301 70.56 27,227,763 76.32 1,142,462 4.20
-------------- -------------- -------------- -------------- -------------- --------------
Gross Margin 2,427,160 27.17 1,812,879 25,69 554,281 29.60 10,884,130 29.44 8,449,006 23.68 2,435,124 28.82
Selling & Admin Expenses:
Wages & Salaries 1,013,487 11.35 886,347 12.16 (127,140) 14.34- 4,830,139 13.07 4,595,331 12.88 (234,808 ) 5.11-
Bonus Provision 107,841 1.21 107,842 1.48 1 ,00 560,774 1.52 560,776 1.57 2 ,00
401K Match provision 12,927 .14 12,928 .18 1 .01 67,218 .18 67,219 .19 1 .00
PayroLl Taxes 63,5lJ .71 51,869 .71 (11,644) 22.45- 334,580 .91 336,795 .94 2,215 .66
Benefit Costs 38,873 .44 38,390 ,53 (483) 1.26- 193,591 .52 200,955 .56 7,364 3.66
Marketing & Promotions 4,180 .05 18,576 .25 14,396 77.50 36,502 .10 96,597 .27 60,095 62.21
Promotion - Customer Rebate 6,750 .08 0 .00 (6,750) .00 71,100 .19 0 .00 (71,100) .00
Mvertising 0 .00 818 ,01 818 ***. ** 0 ,00 4,256 .01 4,256 ***. **
1:mployee Recruiting 34, 654 .39 11,063 ,15 (23,591) 213.24- 78,819 .21 57,521 .16 (21,298) 37.03-
~uto Expenses 12,044 .13 12,545 .17 501 3.99 53,179 .14 65,238 .18 12,059 18.48
3ad Debts Expense 0 ,00 30,144 .41 30,144 ***,** 400 .00 156,744 .44 156,344 99.74
Jonations & Charitable Giving 4,050 .05 3,412 ,05 (638) 18.70- 35,090 .09 17 ,740 .05 117,350) 97 .80-
mes & Publications 2,097 .02 2,136 .03 39 1.83 12,546 .03 11,104 .03 (1,442) 12.99-
;onventions/Meetings 1,920 .02 0 ,00 (1,920) .00 1,920 .01 0 .00 (1,920) .00
3usiness Travel 18,986 .21 19,838 .27 852 4.29 150,587 .41 103,155 .29 (47,432) 45.98-
lntertainment Expenses 5,102 .06 4,243 .06 (859) 20,25- 48,846 .13 22,066 ,06 (26,780) 121.36-
)Utside Connnissions Paid 12,405 ,14 3,218 .04 (9,187) 285.49- 39,302 .11 16,735 .05 (22,567) 134.85-
)utside Connnission E-commerce 386 .00 900 .01 514 57,11 2,765 .01 4,676 .01 1,911 40.87
\udit & Accounting Fees 9,375 .10 6,104 ,08 (3,271) 53.59- 50,775 .14 31,744 .09 (19,031) 59.95-
:,egal Fees (2,942) .03- 6,661 ,09 9,603 144.17 34,418 ,09 34, 637 .10 219 .63
1mployee Education/Seminars 860 .01 580 ,01 (280) 48.28- 1,175 .00 3,016 .01 1,841 61.04
Jther Fees 5,944 .07 9,038 .12 3,094 34.23 29,877 .08 47,000 .13 17,123 36,43
fending Income/Expense 6,098 ,07 5,016 .07 (1,082) 21.57- 28,179 .08 26,080 .07 (2,099) 8.05-
inployee Recognition 15,204 .17 23,628 .32 8,424 35,65 117,469 .32 122,864 .34 5,395 4.39
Jffice Supplies/Minor Equipmen 12,677 .14 10,838 .15 (1,839) 16.97- 63,823 .17 56,360 .16 (7,463) 13.24-
loftware Maintenance 1,860 .02 950 .01 (910) 95.79- 1,860 .01 4,940 .01 3,080 62.35
)ffice Equipment Rental 3,925 .04 5,244 ,07 1,319 25.15 34,897 .09 31,460 ,09 (3,437) 10.92-
1.
Jul13, 2004 - 5:08pm Challenge Printing Consolidated Operations Page 2
Repairs & Maintenance 4,945 .06 4,426 .06 (519) 11. 73- 14,920 .04 23,016 .06 8,096 35.18
Supplies - Internal Produced 11,881 .13 17,113 ,23 5,232 30.57 56,661 .15 88,986 .25 32,325 36.33
Telephone 11,959 .13 12,629 .17 670 5,31 69,835 .19 75,770 .21 5,935 7.83
Depreciation 10,495 .12 11,446 .16 951 8.31 54,880 .15 59,520 .17 4,640 7.80
Insurance -' Office 8,027 .09 8,136 .11 109 1.34 48,160 ,13 48,816 .14 656 1.34
Officer Insurance 880 .01 197 .00 (683) 346.70- 4,402 .01 1,182 ,00 (3,220) 272.42-
Bank Service Fees 2,814 .03 3,802 .05 988 25.99 19,637 .05 22,809 .06 3,172 13.91
Early Payment Discounts (1,584) .02- (1,071) ,01- m 47.90 (9,581) .03- (5,566) .02- 4,015 72.13
Miscellaneous 2 .00 16 ,00 14 87.50 934 .00 89 .00 {845} 949.44-
-------------- -------------- -------------- -------------- -------------- --------------
Total Selling & Admin Exp 1,441,633 16.14 1,329,022 18.23 (112,611) 8.47- 7,139,677 19,31 6,989,631 19.59 (150,046) 2.15-
-------------- -------------- -------------- -------------- -------------- --------------
Income from Operations 985,527 11. 03 543,857 7.46 441,670 81. 21 3,744,453 10 .13 1,459,375 4.09 2,285,078 156.58
Other Income (Expenses)
Recoveries on Bad Debts 0 .00 0 ,00 0 .00 6,794 .02 0 .00 6,794 .00
Net on Gustafson Building 983 .01 0 .00 983 .00 28,861 .08 0 ,00 28,861 .00
Interest Income 30 ,00 0 .00 30 .00 710 .00 0 .00 710 .00
Other Income 0 .00 0 .00 0 .00 104 .00 0 .00 104 .00
Finance Charges Income 335 .00 1,067 .01 (732) 68.60- 4,001 .01 6,398 .02 (2,397) 37.46-
Interest Expense (18,013) .20- (31,883) .44- 13,870 43.50 (104,910) .28- (191,2981 .54- 86,388 45.16
Other Expense (545,389) 6.11- (700,0001 9,60- 154,611 22.09 (1,045,389) 2.83- (700,000 ) 1.96- (345,389) 49.34-
Minority Interest in sub (35,846) .40- (20,531) .28- {15,315} 74.59- (62,653) .17- (31,122) .09- (31,531) 101.31-
Current Income Tax (2,500) .03- (1,750) ,02- (750) 42.86- (8,300) .02- (3,500) .01- (4,800) 137.14-
-------------- ---------...---- -------------- -------------- -------------- -----------...--
Net Other Income (Expenses) (600,400) 6.12- (753,097) 10,33- 152,697 20.28 (1,180,782) 3.19- (919,522) 2.58- (261,260) 28.41-
Net Income 385,127 4.31 (209,240) 2.87- 594,367 284.06 2,563,670 6.93 539,853 1.51 2,023,817 374,88
---- ----- - - ---
--- ---
I
19
Statement Of Cash Flows
CONSOLIDATED OPERATIONS
For The Period OS/27/2004 To 06/~0/2004
Current Per~od Year-To-Date
Amount Amount
Cash Flows From Operating
Activities:
Net Income (Loss) ~85,126.73 2,563,670.27
Adjustments To Reconcile
Net Income To Net Cash
Provided By Operating
Activities:
Less Accumulated Depreciation 146,817.72 465,105.47
Decrease (Increase) In
Assets:
Accounts Receivable (3,305,140.49) (738,629.96)
Accounts Receivable Misc (21,976.78) 38,928.41
Allowance-Doubtful Accounts .00 (16,441.02)
Unearned Finance Charges 3,434.61 15,775.14
Sales Tax Refund Receivable 6,841.89 18,396.50
Due from Employees 410.83 395.98
Deposits (376,598.26) (460,830.10)
Inventory-Paper (69,572.96) (147,449.65)
Inventory-Other (49,324.18) (417,883.44)
Inventory-Lettershop Postage 842.20 (3,574.40)
Inventory Reserves 5,000.00 30,000.00
Inventory-Equipment for Sale 2,090.06 11,066.56
Work In Process 1,041,973.03 (1,600,572.63)
Prepaid Insurance (84,758.53) 47,047.42
Prepaid Expenses (General) (1,917.82) 31,829.86
Increase (Decrease) In
Liabilities:
Current Portion of LT Debt 3,474.85 3,474.85
Current Portion of Cap lease (9,077.76) (9,077.76)
Deposits on Equipment Projects 26,889.75 (69,452.85)
Accounts Payable 777,306.61 831,955.82
Accounts Payable Accrual (503,403.73) 294,458.89
Line of Credit Payable 1,955,000.00 (410,000.00)
Sales Tax Payable-MN (11,809.62) (17,711.90)
Use Tax Payable-MN 2,005.65 (1,400.35)
Sales Tax Payable-Mpls (18.67) (603.16)
Sales Tax Payable-City/County 31. 02 47.49
Cash Transaction Clearing (33,253.55) .00
AP to AR Clearing 18,052.49 (3,937.02)
Accrued Salaries Payable 377,843.96 30,140.94
Accrued Commissions Payable 238,700.00 76,000.00
Accrued Vacation Payable (2,855.90) 10,762.16
Accrued Profit Sharing 107,841.00 560,774.00
Accrued 401K Match Payable 12,927.00 67,218.00
4&
Jul 13, 2004 - 5:22pm Challenge Printing Consolidated Operations Pag.
Real Estate Taxes Payable 22,846.25 (278.70)
Accrued Interest Payable (1,628.64) (2,998.70)
Accrued-Other 522,800.00 991,371.35
Customer Deposits .00 (18,598.23)
FICA Payable 46,994.98 6,364.96
Federal Tax WH Payable (85.37) (465.35)
state Tax WH Payable (1,009.98) (1,021.42)
Unemployment Tax Payable 11,687.59 35,980.02
401(K) Withholdings Payable (213.54) (735.31)
Cafeteria Medical WH Payable (161.11) 9,236.44
Other Payroll WH Payable .00 .01
--------------- ---------------
Net Cash Provided By
Operating Activities 1,244,131.33 2,218,360.59
Cash F10ws From Investing
Activities:
Office Furniture & Equipment .00 102,066.87
Equipment-Production (137,655.62) (73,454.28)
Lease Deposits (143,027.28) 1,551.07
Due From Officer (809,313.36) (2,737,771.51)
Notes Receivable (6,667.42) (28,195.30)
--------------- ---------------
Net Cash Provided By (Used In)
Investing Activities (1,096,663.68) (2,735,803.15)
Cash Flows From Financing
Activities:
Notes Payable (37,573.03) (234,251.75)
IRB Note Payable .00 (90,000.00)
Notes Payable-Current Portion (3,474.85) (3,474.85)
Capital Lease-Current Portion 9,077.76 9,077.76
Deffered Lease Gains (6,782.00) (40,692.00)
Minority Interest in Sub 35,846.25 50,152.89
--------------- ---------------
Net Cash Provided By (Used In)
Financing Activities (2,905.87) (309,187.95)
Net Increase (Decrease) In
Cash And Cash Equivalents 144,561.78 (826,630.51)
Cash And Cash Equivalents
At Beginning Of Year (905,987.16) 65,205.13
Cash And Cash Equivalents At
End Of Year (761,425.38) (761,425.38)
=============== ===============
44
CPJ ONLY ASSUMPTIONS: 2005.2008
Overall Annual Sales Growth: 04=12.2%.05=14.2%,06=9.6%,07=8%,08=8%
2005-2008 assumption:
non-operating expo Other Expense: See "Financing of One-Time Costs" spreadsheet for details. Ties to CPJ
2005 assumptions:
Sales:
sheetfed sales growth to third party = 15%
sheetfed sales growth to Nu = 5%
CPI sales of label products to CPI customers = 5%
freight & postage revenue = 15%
other charges invoiced = 5%
early pay discounts = 15%
Materials:
material costs, used same % of sales as budget from 04
Outside printing costs from Nu =100% of curro Yr. label sales revenue from Nu.
Direct labor:
direct labor. increase 50% of sales volume % growth + 3% for inflation
overtime = 3% for volume + 3% for inflation = 6% total
benefits medical/other - 04 + increase 50% of sales volume % growth + 10% inflation
payroll taxes-8.5% of curro Yr. Direct labor costs
contract labor - 3% for volume + 3% inflation = 6% total
Manf. O/H
indirect labor, increase 50% of sales volume % growth + 3% for inflation
overtime = 3% for volume + 3% for inflation = 6% total
benefits medical/other - 04 + increase 50% of sales volume % growth + 10% inflation
payroll taxes-8.5% of curro Yr. indirect labor costs
Insurance - up 10%, workers camp costs and hard market, it could be much higher
depreciation - net $50K increase each year for main. Capex.
Rent - up 3% to stay with market increases
Reprs & maint./supplies, increase 50% of sales volume % growth + 3% for inflation
Factory Equip. Rental - See "2004-2008 Lease Schedule" for details.
Freight & Postage = 95% of curro year freight revenue
All other expenses = 3% for inflation
SGA
salaries - 04 balance plus 10% of sales dollar volume + 3% for inflation
bonus - 1.5% of total sales volume in current year.
401 k match - .61 % of Dl, IDL, SGA salaries
Payroll taxes - 6% of SGA salaries for current year
benefits medical/other - 04 + increase 50% of sales volume % growth + 10% inflation
Insurance - up 10%
All others - increase for 3% inflation only
2005 thru 2008 Depreciation - + net $50K each year for maint. Capex of $350K annually
Fact. Equip. Rental- assume maint. Capex = $1.0M = $12K x 12 = $144K each yr additional
CPJ P&L FORECAST.xls
NU ONLY ASSUMPTIONS: 2005.2008
Overall Annual Sales Growth: 04=12.4%,05=8.8%,06=7.8%,07=7.8%, OB=7.9%
2005 assumptions:
Sales:
label sales growth to third party = 12%
label sales growth to CPI = 5%
Nu sales of sheetfed products to Nu customers = 5%
freight & postage revenue = 10%
other charges invoiced = 5%
early pay discounts = 10%
Materials:
material costs, used same % of sales as budget from 04
cost of equipment sales = 63.5% of equipment sales revenue in current year
Outside printing costs from CPI = 100% of curro Yr. Of sheetfed sales revenue from CPI
Direct Labor:
direct labor, increase 50% of sales volume % growth + 3% for inflation
overtime = 3% for volume + 3% for inflation = 6% total
benefits medical/other - 04 + increase 50% of sales volume % growth + 10% inflation
payroll taxes-B.6% of curro Yr. Direct labor costs
contract labor - 3% for volume + 3% inflation = 6% total
Manf. O/H
indirect labor, increase 50% of sales volume % growth + 3% for inflation
overtime = 3% for volume + 3% for inflation = 6% total
benefits medical/other - 04 + increase 50% of sales volume % growth + 10% inflation
payroll taxes-B.6% of curro Yr. indirect labor costs
Insurance - up 10%, workers comp costs and hard market, it could be ml:lch higher
depreciation - net $1 OK increase each year for main. Capex.
Rent - up 3% to stay with market increases
Reprs & maint./supp/fes, increase 50% of sales volume % growth + 3% for inflation
Factory Equip. Rental - + $25K additional each year, plus see "2004-2008 Lease Schedule"
Freight & Postage = B9% of curro Yr. Freight revenue
All other expenses = 3% for inflation
SGA
salaries - 04 balance plus 10% of sales dollar volume + 3% for inflation
bonus - 1 % of total sales volume in current year.
401 k match - .65% of DL, IDL, SGA salaries
Payroll taxes - 8% of SGA salaries for current year
benefits medical/other - 04 + increase 50% of sales volume % growth + 10% inflation
All others - increase for 3% inflation only
2005 thru 2008 Depreciation - + net $1 OK each year for maint. Capex of $70K annually
Fact. Equip. Rental - assume maint. Capex = $125K = $2.1 K x 12 = $25K each yr additional
CPI P&L FORECAST.xls
FINANCING OF ONE-TIME COSTS
7/26/200415:08
One Time Costs: TOTAL CASH 04 P/L IMPACT 05 P/L IMPACT 06 P/L IMPACT 07 P/L IMPACT 08 P/L IMPACT
Electrical work ($200 hit to 04, $800K over five yrs) $1,000,000 total $1,000,000 $240,000 $160,000 $160,000 $160,000 $160,000
NuQuestJPMC/BobstJFolder Gluer $750,000 $750,000 $0 $0 $0 $0
Heidelberg costs to de-install and re-install presses $600,000 $600,000 $0 $0 $0 $0
Other Misc. Equipment moves (stitcher, CAD, Creo, Collators) $500,000 $500,000 $0 $0 $0 $0
Racking ($250K) and Two forklifts ($150K) (finance $400K via usa equipment line) $400,000 $20,000 $80,000 $80,000 $80,000 $80,000
Make-up Air/Humidity Control $300,000 $300,000 $0 $0 $0 $0
Pour new press pads ($25K each for both KBA's, $10K oth.) $200,000 $200,000 $0 $0 $0 $0
George Date (move all equipment CPI and NU, trucks only) $200,000 $200,000 $0 $0 $0 $0
Bailing System (de-install and re-install) $150,000 $150,000 $0 $0 $0 $0
KBA 64" -de-install and re-install by KBA $100,000 $100,000 $0 $0 $0 $0
Venting in 1000 building $100.000 $5.000 $20,000 $20.000 $20.000 $20.000
sub-total move costs only $4,300,000 $3,065,000 $260,000 $260,000 $260,000 $260,000
Holding cost of 7500 Bldg. (9 Mos. @ $75,560 Each) $680,040 $453,360 $226,680 $0 $0 $0
Holding cost of 7490 Bldg. (3 Mos. @$59,OOOEach) $177,000 $177,000 $0 $0 $0 $0
Interest on $11.5M @ 6.25% interest only in 04, 5.5mo. (close perm. Fin 12/04) $329,427 $329,427 $0 $0 $0 $0
Interest on #1 $4M Advancing term loan (constr. Only, Interest only) 4%,04 only $73,333 $73,333 $0 $0 $0 $0
Interest on #2 $4M Adv.term loan 1/1/05 (one time costs, 5 yr.) 4%, inter 04,05 P $73,333 $73,333 $960,000 $928,000 $896,000 $864,000
Abandon Leaseholds $0 I $1,119,4241 $0 $0 $0 $0
Sub-Total -cash or finance these costs $5,633,134 $5,290,878 $1,446,680 $1,188,000 $1,156,000 $1,124,000
New vs Current Comps3.xls
I 2004 - 200S Lease Schedule l
Monthly ANNUAL ANNUAL ANNUAL ANNUAL ANNUAL
Operating Equipment Leases Lease Lease Lease Monthly Implicit Original Net Financing Payment FORECAST FORECAST FORECAST FORECAST FORECAST
Equipment I Start Date End Dates Tenn (Yrs) Lease Factor Interest % Amount Amount Institution 0.0% 2004 2005 2006 2007 2008
Vehicles
2001 Lexus 430 (Bob) 2/4/2004 01/04/07 3.00 0.016963931 67,409.49 67,409.49 Lexus Financial Servo 1,143,53 13,722,36 13,722.36 13,722.36 13.722.36 13,722.36
28' Dock Truck 8/1/2004 07/01/08 4.00 0.016n4700 80,000.00 80,000.00 Unknown 1.341,98 6.709,88 16,103,71 16.103.71 16,103.71 9,393,83
Vehicle Totals $ 147,409.49 $ 147,409.49 $ 2,485.51 $ 20,432.24 $ 29,826.07 $ 29,826.07 $ 29,826.07 $ 23,116.19
Creo Trendsetter 3244 6/8/2000 5/8/2005 5 0.019557100 8.3% 303,548.00 303,548.00 Merchants Capital 5,936.52 71,238.22 25,230.20 -
CreoScitex Brisque4 Impose 1212212000 11/22/2005 5 0.019550000 8.3% 499,762.00 499,762.00 Merchants Capital 9,nO.35 117,244.17 107,473.82 -
Creo VlF5067V Trendsetter 1/5/2001 1/5/2006 5.42 0,017671740 7.1% 527,750.00 527,750.00 Firstar Bank (USB) 9;326.26 111,915.13 111,915.13 1,119.15 -
WLF Platesetter for 80. Plates 10/1/2004 9/1/2010 6.00 0.017671740 7.1% 440,000.00 440,000.00 Firstar Bank (USB) 7,n5.57 23,326.70 93,306,79 93,306.79 93,306.79 93,306.79
Auto-loader for WlF 80. Plateseller 5/1/2005 4/1/2011 6.00 0.017671740 7.1% 160,000.00 160,000.00 Firstar Bank (USB) 2,827.48 22,619.83 33.929.74 33,929.74 33,929,74
Electronic Prepress Dept Totals $ 1,931,060.00 $ 1,931,060.00 $ 35,636.17 $ 323,724.21 $ 360,545.77 $ 128,355.68 $ 127,236.53 $ 127,236.53
Quickmasler Presses 4/29/1999 3/29/2007 8 0.011306847 6.5% 50,000.00 50,000.00 Fifth Third leasing Co, 565.34 6,784.11 6,784.11 6,784.11 2,261.37 -
KBA Rapida 7-COlor, 64. Press 3130/2001 3/30/2009 8 0.011417292 6.8% 4,100,000.00 3,893,155.66 Firslar Bank (USB) 44,449,29 533,391.54 533,391.54 533,391.54 533,391.54 533,391.54
Heidelberg SM52 6-color Press - 2001 917/2001 917/2009 8 0.011601357 7.3% 1,039,780.00 1,039,7811.00 Firstar Bank (USB) 12,062,86 144,754.31 144,754.31 144,754,31 144,754.31 144,754,31
New 6 Color UV Press w/Curing 9/20/2002 9/20/2010 8 0.010759196 4.8"1. 3,416,242.00 3,295,406.43 Fifth Third leasing Co. 35,455.92 425,471.08 425,471.08 425,471.08 425,471.08 425,471.08
New Heidelberg 7 Co140. UV Press 10/18/2003 10/18/2011 8 0,010875330 4.9% 2,376,480.00 2,376,480.00 Merchants (5Ih/3rd) 25,845,00 310,140,05 310,140,05 310,140.05 310,140.05 310,140,05
New Heidelberg 6 Co140. CD Press 4/27/2004 3/27/2012 8 0.010759196 4.8% 1,709,756.00 1,709,756.00 Fifth Third leasing Co. 18,395.60 147,164.80 220,747.20 220,747.20 220.747.20 220.747.20
W lamps for Press 11/1/2004 6/1/2012 8 0.010759196 4.8% 450,000.00 450,11011.011 Fifth Third leasing Co. 4,841.64 9,683,28 58,099.66 58,099.66 58,099.66 58,099.66
KBA Rapida 6-Color, 41. Press 12/1/2004 12/1/2012 8 0,010759196 4.8% 1,820,0011.110 1,820,11011.00 Key Corp leasing 19,581.74 19,581.74 234,980.84 234,980.84 234,980.84 234,980.84
KBA Rapida 6-COlor, 81. Press 12/1/2004 12/1/2012 8 0.010759196 4.8% 6,308,000.00 6,308,000.00 Key Corp leasing 67,869.01 67,869,01 814,428.10 814,428,10 814,428.10 814,428.10
Densllronic-S 81. 12/1/2004 12/1/2012 5 0.014958476 7.8% 50,1100.110 50,000.00 Key Corp leasing 747,92 747.92 8,975.09 8,975.09 8,975.09 8,975.09
Press Dept Totals $21,320,258.00 $ 20,992,578.09 Press Dept Totals $ 229,814.33 $ 1,665,587.84 $ 2,757, n1.97 $ 2,757, n1.97 $ 2,753,249.24 $ 2,750,987.87
Polar Jogger 5/10/1999 5/10/2007 8 0.011307200 6.5"10 $ 25,000.00 $ 25,1100.011 Fifth Third leasing Co. 282.68 3,392.16 3,392.16 3,392,16 3,392.16 3,392.16
Polar 176ED Paper Cutler 3130/2001 3130/2008 7 0.012581921 7.2% 495,290.00 495,290.00 Firstar Bank (USB) 6,231.70 74,780,40 74,780,40 74,780,40 74,780.40 74,780.40
Cad/Cam 5120/2001 5/20/2006 5 0.014958476 7.8% 65,000.00 65,000.00 Firstar Bank (USB) 972.30 11,667.61 11,667.61 11,667.61 11,667,61 11,667.61
Bobst, 5/20/2001 5/20/2006 5 0.014958476 7.8% 250,000.00 250,000.00 Flrstar Bank (USB) 3.739.62 44,875,43 44.875.43 44.875.43 44,875.43 44,875.43
Bobst Die Cutter - large Fonnat 6/29/2001 6/29/2009 8 0.012453700 6.6% 600,000.00 600,000.00 Fifth Third leasing Co. 7,472,22 89,666.64 89.666.64 89,666.64 89,666.64 89,666.64
Bobst SP-104, Die Cutter- New 6/1 0/2002 6/10/2010 8 0.011169484 5.6% 738,650.00 738,650.00 Fifth Third leasing Co. 8,250.34 99,004,07 99,004.07 99,004.07 99,004.07 99,004.07
8OOst1oo-11 Folder/Gluer & Carton P2 6/10/2002 6/10/2010 8 0.011169484 5.6% 361,350.00 1n,680.00 Fifth Third leasing Co. 1,984.59 23.815.13 23,815.13 23,815,13 23,815.13 23,815.13
2 Tunkers laminators + 2 Card Die Cut 10/15/2003 10/15/2009 6 0.013819134 5.5% 312,000.00 312,000.00 Merchants (5Ih/3rd) 4,311,57 51,738.84 51,738.84 51,738.84 51,738.84 51,738,84
Inkjet System for plastic cards 7/1/2004 2/1/2009 5 0.014958476 7.8% 150,000.00 150,000.00 Unknown 2,243.77 13,462.63 26,925.26 26,925.26 26,925.26 26,925.26
. Jumbo Guillltine Cutter 10/1/2004 911/2011 7 0,012548486 4.5% 800,000.00 800,000.00 Unknown 10,038.79 30,116,37 120,465.47 120,465.47 120,465.47 120,465,47
Jumbo Mounting Equipment - 80' 12/1/2004 11/1/2011 7 0,012548486 4.5% 300,000.00 300,000.00 Unknown 3,764.55 45,174.55 45,174.55 45,174.55 45,174.55 45,174.55
Die Cutter - Jumbo Fonnat 11/1/2004 10/1/2011 7 0.012453700 6.6% 350,000.00 350,000.00 Unknown 4,358.80 8,717.59 52,305.54 52,305.54 52,305.54 52,305.54
Cad Table 11/1/2004 10/1/2009 5 0.014958476 7.8% 75,000.00 75,000.00 Unknown 1,121,89 2,243.n 13,462.63 13,462.63 13,462.63 13,462,63
Load Flipper 11/1/2004 10/1/2009 5 0.014958476 7.8% 100,000.00 100,000.00 Unknown 1,495,85 2,991.70 17,950.17 17,950.17 17,950.17 17,950.17
FOrklilts & Racking 10/1/2004 9/1/2009 5 0.014958476 7.8% 460,000.00 460,000.00 Unknown 6,880.90 20,642,70 82,570,79 82,570.79 82.570,79 82.570.79
Finishing Dept Totals 5,082,290.110 4,898,620.00 Finishing Dept Totals 63,149.56 522,289.57 757,794.67 757,794.67 757,794.~ 757,794.67
./ ./
Total - Challenge $28,481,017.49 $27,969,667.58 Total- Challenge $331,085.56 $2,532,1133.86 $3,905,938.48 $3,673,748.40 $3,668,106.51 $3,659,135.26.......
NUQUEST LABEL EQUIPMENT vft.-.l r;1'70,to i,f/"f,tlJ ],Cfl.ff1 .:r,/o~~~.?
2002 GMC Yukon Denali (Paul) 7/1/2002 7/1/2005 3 0.017794553 44,245.00 44,245.00 GMAC leasing 787.32 9,447,84 9,447,84 9,447.84 9,447.84 9,447.84
Mark Andy Model 2200-13. label Pres! 8/30/1999 7130/2007 8 0,011564700 6.9% 285,096.00 285,096.00 Fifth Third leasing Co. 3,297.05 39,564.60 39,564.60 39,564.60 26,376.40 -
9 Color Model 1620 W label Press 9/27/2002 9/27/2010 8 0.010659050 4.6% 1,293,225.00 1,293,225.00 Fifth Third leasing Co. 13.784,55 165,414.60 165,414.60 165,414.60 165,414.60 165,414.60
PCMC X-10 8/c Press 10/1/2003 10/1/2010 7 0.012548453 4.7% 222,397.93 222,397.93 Key leasing Corp. 2,790.75 33,489,00 33,489.00 33,489,00 33,489.00 33,489.00
PCMC X-10 8/e Press 11/1/2004 10/1/2011 7 0.01265776 4.7% 230,000.00 230,000.00 2,911.28 5,822.57 34,935.42 -I- itl3j,J2 +~=t"'42 f2S~.42
Subtotal. NuQuest $ 2,07 963.93 $ 2,074,963.93 Subtotal - NuQuest $ 23,570.95 $ 253,738.61 $ 282,851.45 $ 282,851.45 $ 269,663.25 $ 243 286.86
~J 2"17ff :rl ,7 ., 17C,1)g :161,'1\&
Total Equipment Lease Payments $30,555,981.42 $30,044,631.51 Total EqUip. Lease PaYIT $354,656.52 $ 2,785,n2.46 . $ 4,188,789.94 $ 3,956,599.85 $ 3,937,769.76 $ 3,902,422.11
\101M J) 'r?, Nt ~t::l.'.llt\ :r. 'ttf,' "\ l '1,'{ 't. 'Iff
Monthly ANNUAL ANNUAL ANNUAL ANNUAL ANNUAL
CAPITAL Equipment Leases : Lease Lease Lease Monthly Implicit Original Net Financing Payment FORECAST FORECAST FORECAST FORECAST FORECAST
Equipment I Start Date End Dates Tenn (Yrs) lease Factor Interest 'Yo Amount Amount InstitutIon 0.0% 2004 2005 2006 2007 21108
2 Color perfector 4/15/2000 4/15/2004 4 0.024213626 8.0% 134,300.00 134,300.00 Wells Fargo Equip Fin. 3,251.89 11,381.61 - - .
Automatic Baling Equipment 9/24/2003 10/24/2010 7 0.013731855 4.5% 204,370.05 204,370.05 Key leasing Corp. 2,806.38 33,676.56 33,676,56 33,676.56 33,676.56 33,676.56
SUMMARY PiL'S (000'S)
1o9D
- 2fi-Jul-04 258 PM
Ch31klIgB PBntlllpkM. Actual Actual Actual Actual Actual BUDGET 4aridnc~03i04 ~oreeast Varishei=94!05 Forecast VaflanCe05(p6 Forecast
Vari2tlC¢O6I07 Porecast Varian'CP'OTOB
CPI-TREND COMPARISONS 1999 ~ 2000 2001 2002 2003 ~ budget-2004 Favorablc;(Unfav) 2005 ~ Farorn6le'IUafavl 2096 Fa•, Orable7(Unfa~rl
2607 Favura6leilUn[wj 2008 Favorabinf(Un(avl
3SALES ~ r, '.C ~,OC 1G, O;S 4, 1~'S:L a ti.~c9i, ,071 1c°P r: 7;•3,r_,. ~ 133::: 76 act 1JLG~ 14~.. _d aG'
C. God ~ '"i ~3 7.1.. ~c r~7? 1~~.C"S 1..
MATERIALS 10,794 29.3% 10,118 27.7% .12,218 27.7% 16,987 34.1°k 23,238 38.7% 24,632 36.5% (1,393) -6.0°h 28,020 36.4%
(3,388) •13.8% 30,591 :362% (2,571) -92% 32,894 362% (2,302) -7.5% 35,372 36.1% (2,479) •7.5%
DIRECT LABOR 10,706 29.0% 7,301. 20.0% 7,723 17.5% 8,682 17.4°k 9,919 :16.5% 11,254 16.7% (1,335) •13.5°h 12,438 162%
(1,184} -10.5% 13,477 16.0% (1,039) •8.4% 14,490 15.9% (1,013) -7.5°!° 15,585. 15.9% (1,095) -7.8%
MANUF.OVERHEAD 6_,246 ,'~9°/ 9181 251_% 11330 25.7°k 126285.4°/a 13.3993% 7806 22A°h 1f •4071 •1~ .18.213 ~ (3a4~
-23_4% j9062 22_6% (t3~ -0.7% 201 221% Ol_9j -5.3% 2132 21_.7% tj
2421
COST OF GOODS SOLD .27,746 752°k 26,598 72.7% 31,269 71.0% 38,298 77.0% 48,556. 77.5% 50,692 752% (4,136) -8.9% 58,670
76.2% (!,979) -15.7% 83,131 74.8% (4,460) •7.8% 67,465 74.2% (4,334) -0.9% 72,280 73.7% (4,816) -7.1%
GROSS MARGIN 9,141 24.8% 9,982 ' 27.3% 12,797 29.0% 11,462 23.0% 13,515 22.5% .18,706 24.8°h 3,192 23.8% 18,311 23,8% 1,605 9,8%
21,272 252% 2,961 16.2% 23,516 25.8% 2244 10.6°h 25,797 26.3% 2,280 9.7%
SELLWG,GENERAL&ADMIN. 7,852 21.3% 7,158 19.6% 9,082 20.6% 8,906 17.9% 9,751 16.2% 11,514 17.1% (1,762) •18.1% 13,113 17.0%
(1,599) -13.9% .14,459 17.1% (1,346) •10.3% 15,740 17.3% (1,281) -0.9% _ 17,130 17.5% (1,390) -8.8%
.OPERATING INCOME t.'-~ 2.b?G 3.:15 r4 3 :4 i1Y6 r:3 C?;,.. .?2 1e2y 3FO~.;~ .;,1?.% .F-.:. r; 01 s1? v: 'a,~. ~ai;rl 11
~.3
NON-0PERATINGINC(EXP) 203 0.6% (257) -0.7% (121) -0.3% 480 1.0% 303 0.5% (4,833) -72% (5,136) 1695.0%. (862) •1.1% (3,971)
-82.2% (485) -0.6% (377) -03.7% (319) -0.4% (167) -34.4% (185) -0.2% (153) -48.1%
NET INCOME 1,482. 4.0°h 2,567 7.0% 3,594 8.2% 3,035 6.1% 4,066 6.8% 359 0.5% (3,707) -912% 4,336 5.6% (3,965)
-1103.3% 6,328 7.5% 1,238 28,6% 7,457 8.2% 798 12.6% 8,501 8.7% 737 9.9%
EBITDA(NI+INT.+DEPR) 2,981 8.1% 4,290 11.7% 8,075 11.5% 4266 8.6% 5,409 -9.0% 1,628 ' 2.4% 5,584 7.3% 7,661 9.1%
8,878 9.8°k 10,013 102%
EBITDAX7 20,868 30,030 35,523 29,861 37,864 11,379 39,090 53,626 62,149 70,092
NoQuestPRU17SOLUTIONS Actual Actual AcWal Actual Actual BUDGET VarianceOdlOd Forecast Variance 01105 Forecast VadanceOfi106 Forecast
Variance06~07 Fore-cast Variance 07106
- NWUest 1999 2000 200 2002 20x3 8utlge!-2004 Favorablef~Uniavj 2065 Fu~rortlblel Untavl 2006 Favorablelllln(avl 2007. Favorable!~Unfav]
2008 Favorablel(llnfav)
SALES a,ns v.~ ~ l.~l e?a5 1c_c;, i2..i 3c~, 10_ ~5wa ec~~, '~,ea1 17a_ l,P,^2 1c~~O°~ _u~; sa lu_o~; i~-~ wa ~
155c:, 1,4se 7h; i5~
MATERIALS 1,433 44.8% 2,093 44,0% 3,716 45.1% 7,218 55.8°k 6,568 48.1% 7,242 47.2% (677) -10.3% 7,771 46,5% (815) -112% 8281
46.0% (510) $.6% 8,829 45.5% (549) $.6% 9,420 45.0% (591) -0.7%
DIRECT LABOR 595 18.8% 684 14.4% 796 9,7% 1,243 9.6% 1,732 12.7% 2,470 16.1% (738) 42.6°10 2,654 15.9°h (184) 7.4% 2,852
15.8% (198) -7.5°h 3,0~ 15,8% (214) •T.5% 3,299 15.8% (232) -7.6%
MANUF,OVERHEAD 247 7.7% Q08 B-,6% ~ 5i% 1,_,2._42 9.B% 1799 L% 2126 13_8% 326 •18_1% 2263 13_5% j]371 ~ 24106
~ 4% 2y
5959 13y_% L63] ~ ~ 13~ (2051
COST OF GOODS SOLD 2276 71.2% 3,185 66.9°h 4,958 80,1% 9,702. 75.1°!0 10,097 13.9% 11,839 77.1'% (1,741) -17.2% :12,688
76.0% (1,135) 0.0% 13,539 752% (852) 0.0% 14,455 74.5% (916) 0.0% 15,483 74.0% (1,028) 0.0%
GROSS MARGIN 920 28.8% 1,576 33.1% 3,287 39.9% .3,221 24.9% 3,566 26.1% 3,515 .22.9% 51 1.4% 4,011 24.0% 4,011 0.0% 4,455 24.$% 4,455 0.0%
4,948 25.5% 4,948 0.0% 5,450 26.0% 5,450 0.0%
SELLING, GENERAL &ADMIN. 1285 40.2% 1,572 33.0% 2,105 25.500/a .2,215 17.1% 2,571 .18.8% 2,439. 15.9°h 132 5.1% 2,726 16.3% (287)
-11,8% 2,969 16S% (243) -8.9% 3,234 18.7°l0 (285) $.9% 3,523 16,8% (289) -8.9%
r'.
OPERATING INCOME I,~,~,i -1' 4'Y: N: `s,Y;2 ~e.3"'; 1 ~ C 4Y; S45 L3r:: I a;6 1 0.:?':, 8,223 ?79b 13 '.`i : 1.-Ed , ~
1 ,~,f d:="-: 22'~ t;.3`:~ 1,e<p~ y ?14 12 -
NON-0PERATINGINC(EXP) {Bj -0.2°h p6) -1.6% (66) -0.8% (86) -0.7% (BB) -0.6% (104) -0.7% 15 •17.5% (107) -0.6% 3 3.D% (110)
-0.6% 3 3.0% (113) -0.6% 3 3.0% (117) -0.8% 3 3.0%
NETiNCOME (371) -11,6°h Q2) -1.5% 1,118. 13.5% 920 7.1% 907 6.6% 972 8.3% 66 7.3°k 1,178 7.1% 205 21.1% 1,376 7.6% 198
16.8% .1,600 82% 224 18.3% 1,811 8.7% 211 13.2%
EBITDA(NI+INT.+DEPR) (306) •9,6% 107 22% 1,324 16.1% 1260 9.7% 1,371 10.0°!0 1,514. 9.9% 1,733 10.4% 1,944 10.6%
2,182 112% 2,407 11,5%
EBITDAX7 (2,142) 747 9269 8,817 9,595 10,597 12,129 13,811 15,276 18,846
CM CONSOLIDATED ~ Actual Aciual Actual Actual Actual BUDGET Vadance93!04 .Forecast Variance04105 Forecast VarianceQ5106 Porecasf
Vadence0G0i Forecast. Vadance 07108
CONSOLIDATED 1399 2000 2001 2002 200) 6udge42004 FavorablefiUnfovl 2005 FavorableliUnfav) 2006 Favorabld(Unfav) 2007 FavorablegUn(avj
2008 Favorabler(Unfavl
_ _ ~i0:z 6°6 S.O;S 113Gz_ 110.Oz, 8.'1d
SALES 4JAc', JOO L; 41.°.1 ti,,: 51,3~d0 1,r~:5 .531 d 140.?-5 ,?_71!1 1 70'' 7 E.: ;J. C'~ O.f~~o 1"°d, a.,,E,,.y
t, 1;. i"~~1 '6C.G~;o or.; `OA 1. 1
MATERIALS 12,227. 30.5% 12,209 29.5% 15,727 30.3% 19,757 34,0% 24,972 36.3% 27,008 34.7% (2,034) -8.1% 30,680 34.6%
(3,674) •13.6% 33,505 34.5% (2,826) •9.2% ..36,088 34.5% (2,582) -7,7% 38,875 34,4% (2,788} 7.7%
OIRECTLABOR 11,301 28.2% 7,984 19.3% 8,519 18.4% 9,925 17.1% 11,651 17.0% 13,724 17.6% (2,073) -17.8% 15,092 17.0%
(1,368) •10.0% .16,329 16.8°/a (1,237) A.2% 17,557 16.8% (1,227) 7.5% 18,884 16.7% (1,327). -7.6%
MANUF.OVERHEAD .6494 ~6.2% 9590 23Z~o 11767 227% 12,,848 23_8% 1503 2L 16
3sa
2 21.7% !1.9021 -1~ 20475 23_1% 3f,•~43) -20__9% 21_9 22.1 o- )993}, •4__9% 22640 ~ l1,17~ -5.5%
24087 21.3°h 11.4471.
COST OF GOOD5 SOLD .30,022 74.9°k 29,783 72.0% 36,013 .69.5% 43,530 74.8°/a 51,653 752% 51,682 74.0% (6,009) -11.6% 66,247
74.8% (8,585) •14,9% 71,303 73.5% (5,056) -7.6% 76,284. 72.8% (4,981) •7.0% 81,846 72.4% "(5,562) -7.3%
GROSS MARGIN 10,062 ` 25.1% .11,558 .28.0% 15,826 30.5°h 14,648 252% 17,065 24.8% 20221 26.0% 3,156 18.5% 22,322 25.2% 2,100
10.4% 25,727 28,5% 3,406 15.3% 28,484 272% 2,737 10.6°h 31,247 27.6% 2,783. 9.8%
SELLING, GENERALB°ADMIN. 9,147 22.8% 8,730 21.1% 11,172 21.6% 11,086 19.1% 12,307 .17.9% 13,953 17.9% (1,646) -13.4% 15,839
17.9°10 (1,886) •13.5°h 17,428 18.0°!0 (1,590) -10.0% 18,974 18.1% (1,546) -8.9% 20,653 18.3% (1,679) ~8.8%
U,y 7.'%S4 5~~ . L'{", 4fEq 3US 4,75b S'-. 8~`, ) 1.'il 9!7°b ,,A3J "5:-. .714 3.1 'u. ef`r, 1P1: ~G'~ a ~ c.1'.S 117 4
OFERATINGINCOh)E oosG .v: ~ ~ _ - a iqE_ 3vi~ 1,16 1'GS
NON-OPERATINGINC(EXP) 289 0.7°h (315) -0.8°h (500) •1.D% (526) -0.9% (6921 -1.0% (5,909) -7.6% (5,217) 754.2% (2,147) -2.4%
(3,762) -83.7% (1,971) •2.0% (176) A.2%' (2,032) -1.9% 61 31°k (2,093) •1.9% 61 3.0%
NETINCOME 1,204 3.0% 2,513 6.1% 4,154 8.0% 3,035 52% 4,066 5.9°h 359 0.5% (3,707) -912% 4,33fi 4.9% (3,548)
•987.2% 6,328 6.5% 1,641 37.8% 7,457 7.1% 1,251 19.8% 6,501 7.5% 1,165 15.6%
EBITDA(NI+IPIT,+DEPR) 2,768 6S°lo 4,415 10,7% 5,843 `11.3% 4,806 7.9% 5,873 8.5°/0 2,167 2.8% 8,139 6,9% 8,229
8.5% 9,460 9.0% 10,609 9.4%
EBITDAX7 19,375 30,903 40,902 32239 41,113 15,168 42,974 57,604 68,222 74,262
CPI P&L FORECAST.xIs
NuQuest PRINT SOLUTIONS 26-Jul-04 2:58 PM
NuQuest _ri=~" ~:<,,F€. ~..~ ~. .." <:~ i. - ~,~;ri: ,.}~J ,JIII!!II'lltlr(~lti:11 ~l"' :~.II~m',i~~~~1tl'b~~lru"~~~, .f.' ~.J1/~~IHII!ff8J~Bf~O~(qy %3~w,'.J.~WTi"lral%lif.J. ,~'. O~-Il.i;~';f!:~1'1~.r~I!t~I.~
ISales-Pnntpro<!ucts 2,717,941 85.05% 3,414,503 71.72% 5,270,079 63,92% 6,844,546 52,96% 6,438,717 47,13% 8,355,000 54.42% ~'l.~1lI1.~\~~!". ~~- 9,357,600 58,04% ''i~~.i9Q21eJJ!'lii\(f';~: , - 10,293,360 57,20%",*i\Wi;!lR511il?At'0,qtl~e _ 11,322,696 58,36% ll:liI~~~~fl0!jrnplil- 12,454,966 59.50% "i.!fi1,~ii!2;~Zq:;::iiHm~-, <
Sales-ToCPI(Labels) - 0.00% - 0,00% - 0,00% - 0.00% 2,496,412 18,27% 2,667,600 17,37%lil~IT~Jl.tl!l!l;';!j'" .', 2,800,980 16.77%Jjf~j~4\~!\;1l'_" 2,941,029 16.34%lt11'~4~!t"~!NI'. 3,088,080 15.92%'ill';rili"1~i:faf!?".~m: 3,242,484 15.49%ffi'*!P"::l~!!IQiI~:rulif
Sales _ From CPI (Sheetfed) - 0.00% - 0.00% - 0.00% 3,067,554 23.74% 2,166,065 15.85% 2,445,000 15.92% 't!j':;g~g~~it.., ; 2,567,250 15.37% :*Il1iili!~~~Qj}i!:"W* "', 2,695,613 14.98% ."~;12r~6~w,,,:~>" . 2,830,393 14.59% ~d;~!!>!'z~!liliig. .,..: 2,971,913 14.20% 11(411411%- ~;&~,
Equipment Sales Revenue 237,311 7.43% 966,31220.30% 2,360,148 28.63% 2,102,35716.27% 1,421,348 10.40% 950,000 6.19%1~1~~~lr~: . 978,500 5.66%m'i!~~:~JLJp.. 1,007,855 5.60%~0~~i'i~~~f10I.~.. 1,038,091 5'35%lJl;r;~MI'l ~Jj.tp;'kIJI. 1,069,233 5.11%'=A\l.~"ji:l'I:I,m
Freight & Postage Charges - 0.00% 73,310 1.54% 135,676 1.65% 199,059 1.54% 266,845 1.95% 248,726 1.62% j(i"~t1~Zl;1*!)J, '~,,~" 273,599 1.64% 'iij!,i!ll~4;~7aN~1ii~!m 300,958 1.67% ~~4?,,~'ZiiBbq,;i:tJJ4ijli\. '.~ 331054 171% it%~!0' 'Q!jE!rnF~'.1 '.', 364160 174% f:JI t1~~hOe,~'?'"?il . .',
OtherCherges Invoiced 268,261 8.39% 350,179 7.36% 522,941 6.34% 743,514 5.75% 866,585 6.50% 705,388 4.59%1~'~~~1~&IlJII\ i.. 740,657 4.44% oi'~5,~~I'1.~'5;' ' m,690 4.32% ;r~r:;,:~7Ig~IliJt;{6' ~,; 816:575 4:21% 'i:1 ~l~iI~~1 857:404 4:10% \1~~~1d!.82al!t~1&, ~
EariYPaymente!s~unts~"w"" ., 127,692\ -0.87% 143237\ -0;91% , 143964\ -0:53% (335~17l -0.26%, (14,984\ -O.11~~, /18178\ -O}2%~~WI't'!hi~'lftl 119,996\, -O.12%'''!i1j_;lil'a'1Df:m~ilt1i! _ 12~995\. -O.12%',4fi\~f~~i5ooili~\1. 124,195) -O.12%:r ~il20Qv*JI.1 126,615) -O.13%tJ'Jilk~tlZ~20li:lw?!ft~>1
~l'~~~IJl!:~jgl!~1#t~~i .1!,lIl1~ltl!Mi [.I1~ll_qq;pR.~IITI,gjm.i51~'Jll1J::!&\R~ l~~!!~tMaqgi1!l!~ l}~~~~&W.\qg'9P~'~:r;~~''!;J~fat~'1mll' .~.IH,~=~q~C!1t~ ~;~!--~t~iJr:~i~lq,!1,'"",~ ;;:R~j~~1gy~OJRQf& 'i~it?JI~'t~rt,2'1~iJ!(I~!'z'~~ li:l~~A~AfutRtf"q9.YO i~1;:i~J!;1~NG}1'lT>. ~!1'~~~.J.,"'BfuW'.m~ ;~f'.~3!!l~~'I;::'i":!h.~~
J;:~] '*~'''&>iffif~'';r.", '" f!t!li1mE~:!?*'~t@li'li~i~~f.~~ '~illdw,{,,~m~b>,1%Jllii{~>1>w1!.N.l:{ ~~~l"I~*'&i$1m%>WiffittF~~"~ l'1fu"'t\;,*~ff:J:t.Uiw.'> ...."vj%~~~
.. tPdit;t~~m;:;'1~)lli~~wim \: :w... ~/%i~~>4rill;t;,?,~'m~~ It:' ~?~ii"lTI:(::Jt~~~~?< ,1;]~~,;j?,Wt.1mmJ"li}?8jffi"i:%~ "" yW,,%-,\: i'l.~l~ ~if_>>, "~1:'';;;@*~,
Cost of Goods Sold !i"lli!!i!""'."~-<"ruwl*""\li !Ii 1"1-1",,1,'1<" "~m"ruruf~" m!ill~1'N~\1i-"!IT~1~0~"'fu"",8.)'fijli'i~;\1;;:1I;\,iITJ; .!illJj!lli"~',ll)!*fl'
'rill~~~lifj~~~ ~ *j4@flf~~~ihtl%i~~ : ~*;tdW~~\i41~~&F; ~~. fu~];l~~Il:?([~~:(~d~:~~ ~~ll*i~r~;\~~ ~I~{-[#:li ;*\m
t:.=~..~~~ l~ffi.~~~~~;r~\ w pJr~~j~<~~~J? - <m ~~t;~'f.\~~~~Jmi~*-' ,~rm;~~'W&~mJtiH~~1J Jiliff:~~~:d~iJ.~$:;*Wt.f4'~%{fl'ill
pm~~ '",=W' . ~W~l???!rn~f~"r'ili3~~,t.w ~f~i0[gt14^r,ro <<'tt'fr.i;~,iJ. $~ ,,:4!f@f,'Jl,f.itfWMill'yjt W.~;r m%:~st~MWY:~':$ilii::~~~~';'ffimm:~@m F~fw.:~~f;w.f0j1i~'~J - ~i#
Matertals.Roll Stock 1,155,960 36.17% 1,333,280 28.00% 1,752,190 2125% 2,333,929 18.06% 2,935,397 21.48% 3,621,179 23.59% ~ffllliill. . 3,939,197 23.59% ~~X~I._!I.' .' 4,244,905 23.59% 1~fiq~;iQi~~ ~IIJ 4,577,096 23.59% ;1[~~.Im\;i.i~!! 4,938,223 23.59% I~.~i~~~~~ll ,:
Matertals-Ink 0.00% 0.00% 0.00% 200,623 1.55% 200,047 1.46% 2.48,783 1.61% VJii.i'iPi~Ii\%1fli 268,847 1.61% r6~:~52J332 toW?'.. > 289,712 1.61% l1l';ifl~.!!''(l~l.&m;~~ I 312,383 1.61% ~['I' "'67~l$jTh;lgS 337030 1.61% ,"liN'}{2!lt!i4till>1.~ ~
Matertals-Dies 0.00% 0.00% 0.00% 93,858 0.73% 112,049 0.82% 138,224 0.90%~~~j~ij@ 'ii"',. 150,287 0.90%;~~1.'~~~I' >~ 161,951 0.90% ~\llill~1''l'~tlllll""~" ~ 174,624 0.90%fr",JI~jll,Z,,~;,~..~ 166:402 0'90%"I!i~11'~"ai1mt~I"
Matertals-Proofing 0.00% 0.00% 0.00% - 0.00% 22,949 0.17% 28,310 0.18%l~"I,~J,IW& ~~. 30,057 0.18%1\~f%J~dWt,.~,..fl! . 32,390 0.18%1~~I:~~i333Jl";;;' 34925 018'lot!I\'"~:I&\:aiS~X.,M\f'!~' l{~' 37680 018%%1m0jl[lIl~l1LfFJ"';',f~.l!'
Malfllials-Plates 0.00% 0.00% 0.00% 209,347 1.62% 231,653 1.70% 285,772 1.86% ![!ffimA~!jjl~II, 310,594 1.86% ~,":J~i;:gill~::=.9""" 334,698 1.86% .".&);:'~.!Ilil~t"~@J,; ~I 360:890 1:86%!II~~~;1~ljilll!\~. 389:384 1:88% i1ri~i 2!!',lOC~1l~}lG*, ~".
- . ~*W}~~~W~~ @~ y t~ir~~~f.t;~~I~~~" r~J4~iilm:~$.t;]~rer~~~%1~ ~1~ tl~i~rEi<ili;:~~@t~~gmM~Bl ~m*m; f~~?'~;~.!it~8t ~~~
Matertals-Olher 69,324 2.17% 128,823 2.71% 58,113 0.70% 72,844 0.56% 101,377 0.74% 125,061 0.81% ![~l~(gtml~~" . 135,259 0.81%~f0~W1dA~8j;\ttWill'" 145,756 0.81%f~!ft~fl'l49'11~::",g 157162 0.81% fill~iimt14":~Wj; 169562 0 81% ijlfu~@i~4I\1";;ihml. "'~
InventoryValuatlonAdjustment 207,905 6.51% (52,616) ..1.11% (94,266) -1.14% - 0.00% - 0.00% - 0.00% ;l~tiij;;fi&f~JI ," .. 0.00% ti~Nilli~~;-l#im[~t.lti ~ .. 0.00% ~'t~;;i;l~~~I~:~~~~ <<f~ OJ.-o" '.. 0.00% >tY:;1'i!~"r1!t0~;';r_rmrQll * '.. 0'00% 1J~'~l~~wti.lf~~$fuif& ~
Purchase Discounts/Allowances - 0.00% (8,882) -0.19% (19,484) -0.24% (29,924) -0.23% (36,596) -0.27% (36,579) -0.24% :W~rwl"'::i;,Y4!ii~~!l'I' < " 140,077) -0.24% ~~~mJ~j:I~~~lL.' (43,187) -O.24o/",.fijillW1'~\ltllf';;:.:f !' (48 566) -0 24% ;'iii+l~';;'7~a'{"11m1~lll (50241) -0'24% ~1.~"';("r;il';""0j'1.~"'::.I, &%
~~@F lr,ir'*&~~i >> ~ ~.liil>~ ~ii':';d>~;"">>>" If<l~i'-":-fu!t"it"';:""ili.;>"'~,,* m~ . . "% "'%~"':::ms'ijj"l"'>>'&"'m' . . 8:'1!>>:t;v'''l*r}wJ:if!illilliF~'E P.?~
Scrap Sales (7,247) -0.23% .. 0.00% .. 0.00% .. 0.00% - 0.00% - 0.00% illfu8j, ff0.-,%,@lliwri ~ .. 0.00% ;,Jt':~ ~i;dk:~;wff~~t:;' 1;14 .. 0.00% fr:t:~z~ l<WI\tfr.S"l.~"m~ ' e .. 0.00% ~v.:~1~N:~:;~rt1~" ~f~'qo .. 0.00% ([t;m>!'w:1i~':;':;'\:nm;>~:jljf~1P
Purchase Rebates - 0.00% - 0.00% (6,913) -0.08% (7,575) -0.06% (13,523) -0.10% 116,680) -O.11%'!i'%l~JI151~;C,. (18,368) -O.11%,;;:'!i.i'4!;JfI:~Jl~~1;~~, ~ (19,794) -O.11%ff,;;+t:;;~~1~1~~ITt ~ (21,343) -0.11% ~1f;'W>!fri:~r?4S%:Il!,W ,$ (23,027) -O.11%~n,:"fttlm'1f<!i!!4lr;
Cost of Equipment Sales - 0.00% 612,627 12.87% 1,630,566 19.78% 1,412,140 10.93% 894,949 6.55% 598,165 3.90% 1~1.~6~ti2'.*:'" " 621,348 3.72% 1'\~~P.~~1'1" 639,988 3.56% \l;i:i'ttM,fj~\:?'f(. 659,188 3.40% :~I~!l\~W!1iw.~ 678,963 3.24% ir'lth(1$~illln6llli~';:;f"'. :~
OulsidePrintlng-FromCPI . 0.00% - 0.00% - 0.00% 2,760,799 21.36% 2.,075,448 15.19% 2,200,500 14.33% 'I'Ggl>,O.~R:= ", 2,310,525 13.84% t:gt{~)I~QiS~"ii'1iI. " 2,426,051 13.48% fum!;i(1IrSiS261)t,;~~. 2,547,354 13.13',F0!iif2fl;q~Jilltl,/l~ 2,674,722 12.78% 01.fiLt1~~el::'" '~
Outside PrJnting-Other 1,331 0.04% - 0.00% 292,683 3.55% - 0.00% - 0.00% .. 0.00% ~4f1.~:~:*~~~' .. 0.00% ird~~1?~~1:~&~*~Jv~' , - 0.00% 'fJ.@~~~!etljW.i;;,*.' - 0.00% l ~/lflt:;@:~!;;I~I~~1il~~ - 0.00% t~~J\~112,*!lB)~~ t, ~
Outside Services 48,094 1.50% 59,052 1.24% 102,658 1.25% 309,357 2.39% 84,654 0.62% 104,432 0.68'1, i~,!!;i_~1l ,'~..'~_ , 113,550 0.68% ~!ki'~if'lli'8I;k~il~ fA, 122,363 0.66% >'~jll.f!a,8m;"illll!;.W. 131,938 0.68'1, '1q;w!~Jn61,'Wi2;;1i~3~ 142348 0 68% ,,$*l;"t1o.\1Ji5!f~~:'jrr
Intemal Job Matertals - 0.00% - 0.00% (2,542) -0.03% - 0.00% - 0.00% - O.oo%liji;;;J:jj~j",iP"" - o.OO%:kll~~$.J~ir;:,." - 0.00%1.1k..g11illil~~j;ruNl~I,]!,QJ,1P.J - OOO%i%~~I::.'1W]g1irl;likl'.~ '- 0'00%;)I!J::*1i'4r;:r~;';1J.tik. >
Adjustment for Inventories 142425\ -1.33% 20,388 0.43% 2,648 0.03% 1137,679' -1.07% 142784\ -0.31% 152779\ -0.34% IK%."0't;~iil~~W~ _' iJJfi 150,096\ -0.30% .;7i!{.[laiilB3tcie\l8~1iF 153984\ -0.30% >!:Thq:jt;:~Jaear!?@W~f. 158208\ -0:30% !0f~ll;qjj!2~jj8~il1iiiW7s~~ 162,801\ -0:30% :Nfj;0fi:ii1i~~.!~I.I~
Total Materials 1,432,942 44.84% 2,092,692 43.95% 3,716,651 45.07% 7,217,517 55.85% 6,565,620 48.05% 7,242,388 47.17% ;'1I\'1~~S.j'{6l;Ij!li.. ,. 7,771,124 46.54'10 '};";(S:~~6!l8Im,,1j."'i1iJ!j:r , 8,280,848 46.02% ,,1Iiii!f509l"~~l1iijl7m~$A!W 8,829,44245.51% &BifC5.48;594f:Nf:,jijiSf, ~ 9420226 45 00% I'llii}!if(~n'7!84"""I~il0.
(~i~1:~~"m"~ ~,,~~ _ "MM#.~~ ~~llimlli1S;1i,TIi~ %lP ~ 'f:~iIW.1t;;:::\4lt~0E~J>"M:*.]TirM\1 '~'-eillH~>;'~0~ ~WW Jmli%~~t~ 4i~ ,t . J~ ';;~J(', llit' ~ t~'r= 3& ~
~ , _~ ~ ~:p; ~~~' ;:;~,~~~~~g.,~: <gfrt.~l~'0l!~m*:;*lliw.t lit f~f!:~\.~~:~~,."iliillt>! " }A1i1~0j,~il(~T.tr~t' <'@ "">1Fk~itYk$.tA]~f~~\Mij~ w,
'" ""Ii , >> " =-",. {~ ..,." Jj"",w""", ro~l!'1: ;;::: ~ v} "".,~_<, >>.';0: "''''~ """ l' ~'" !!m; w.s*,2!'l." "'~ <~ i~t"lJ~' V.-t:':!V... "i'" ,;j.~
.~~.~_... ~ilJl.';.. q .~mm",*~ill,.!,W:ijf-h d~~,~1!~1ii!0;f;m', "" WII~1i.,;".~,%y.W,["'M , % !fr,liI~il~l\l!~Il,J'
it,lW ,d,{h8l"lJH~~ \ '*' ~i1""<><l4,,"';m";>:"w.%'1l:1 ;r>>~,"z.W':.0"~""'^.')!;?';-;".t~"fj#J~ ~ ~~q~~~>i:t;?m"" "~~""%~ ,!;< 4t~~~#1.r~" ~ ~~g::.ll I
Overtime-Direct Labor 50,658 1.59% 45,606 0.96% 81,005 0.96% 106,842 0.83% 127,877 0.94% 131,712 0.86% frl\~f;!t3,81!Imrd,;" 139,615 0.84% ;fJili.~~~:;4,~0.m " 147,992 0.82% IT[~JEil',lt{!tJw,;[;~~ ' 156,871 0.81% ;i"if1\;~8;~'tIlI:i1!~~ 166,2.83 0.79% .,z',';. :j;:f9:4:ji2 ;,i.: '.ilia r.i
Benefits-Medical 11,204 0.35% 30,551 0.64% 40,057 0.49% 55,193 0.43% 90,521 0.66% 148,606 0.97%il[~~I~.{'~ql!W,1i:'~ 170,627 1.02% 1;\~;~Oal~:i8l1.:' ~ 194,973 1.08%'i\'Mj;jhz41~~I;'Mllil1j:r~'; 222,862 1.15%'ffii'~'~I!~~.Vi;jlijll~I' 254819 1.22%;:,j'JI~r~'till~'%."
Benefits-Other 42,306 - .. .. 0.00% .. 0.00% .. 0.00% ~w~1~f~71~rllit~J. ~< ;f .. O.OOOJ'o ~~n1:1iliG.0.1rK~;i~tt'~~ ' '!! - o.OO%';l~~1~w~1m~~~ffii~1~~']~~wi'~ .. 0.00% 'f.~~~~lMl~;~~ ~~~~:' ~~ . - 0.00% ~"iJw~f&=li~Y!ltm_~" ~ ,
PayrollTaxes 45,372 1.42% 50,821 1.07% 51,831 0.63% 91,830 0.71% 122,773 0.90% 183,298 1.19% Jlll'~~II~IIf1l' 185,399 1.11% RKIJ!'~:ill~!Il~~w"~. ' 198,371 1.10%f..f~'i~~~~i!t:~]~r~!' 2.12,317 1.09% 1"iillf,'~1!1E~Ii1 ' 227,313 1.09% m~l~i.)llrr:~1~1J~']'fu::r.ir ~
Contract Labor 917 0.03% 9,756 0.20% 24,811 0.30% 13,128 0.10% 56,149 0.41% 57,834 0.38% 111)!!:mi~JlP,511;.~' 61,304 0.37% 1[I;;ll~i!~~t:'" 64,982 O.36%S!II::Ull.'i!irg.I~;1Mi~.i!:a' . 68,881 036o/dIrWillil'I$~!1llII~~~Q81 73014 035% ';;.;L~"J4t'il~rf~::;"" '"
AdjuslmentrorWIP-Labor 23,627 0.74% 13775 0.29% 1818\ -0.01% 141709\ -0.32% 152831\ -0.39% (56299) -0.37% "lW10~~~&8;:~1Jmg : 158765\ -0.35% i!::rii:'!'~" iFf';!! . 161 045\ -O.34%Ir1!i~1,., l!abf!01:~lfl ~ lEl3434\ -0:33% ;j~ili5~1Ji1s;imm:~'19.i~ 165:936\ -0:31% 1t1t{i(::,1t~~'~*j!@l'r ' .
Total Labor Costs 595,392 18.63% 683,741 14.36% 796,676 9.65% 1,242,693 9.62% 1,732,084 12.68% 2,470,331 1&.09% i~:l\l~'l,.~o/~)jl", . 2,653,983 16.89% '\"j~~1J'l'~'!!&l"":'1Ilil" , 2,851,911 15.85% ffi'~lliitm~3!~gt~1:;\~F " 3,066,297 15.80% _1i4.~I!$J;~~J:fii!1"m 3,298,672 16.76% Nq"[l:2*gi~1~~';*~i~,4 Ill:
lli~J;:~t'Ui~~* ~ ~tm ,llr~l.~ll~ W~mt f4., - ~~i~lwjF,1m~~]""wk ;% :r~~!Wl WJ LN '4111iNU~lil~t~f~ ~~il~~1ji]~i~iill~~'& ;ID~~ ~,~
'~~~i[~l~IGf,,!~g~tJ_ ;J~N:i~~H.~ > t~!~J~~~'t;11~G;,~*At~ '~~!;~i~q]9i.~~f~r~~Irt.~4~~ il~wiilltJ~ii~l~ J,r~~~~Mi~;;~~i~\i~r~~J~~~~
~:~~~gkl@~[jm 3~ Q~~1j:t.rw~lli~p@rBw~C ' Ji ~TIr~li':rrFm~!~~'~E~~z:-rJW%/~ 1t"'~]~jlit~~~~~=>i10c0%1:m '~~i0?t.~2>>;)~illtf.;;i:0.~l, l~~W~
Indirect Labor Wages . 0.00% - 0.00% - 0.00% 229,453 1.78% 309,059 2.26% 486,559 3.17% i~'iIG~~llIl,~PQ}I}lI' ,""' 523,108 3.13% '11?ii.p,?I]JN1:;';n . 559,708 3.11% :'P:ii(4~!~O!iffJ~0J(l~~.' 599,057 3.09% ~~rr;i@~~i!!?1tr~1iI~Ji 641,370 3.06% I'l!I'f$i!!1{41~!1l11~lifl'ftl&:.~ I~(
Overtime-Indirect Labor - 0.00% - 0.00% - 0.00% 5,852 0.05% 67 0.00% 69 0.00% i~7~i/,!lkt2');'~ M~~, 73 0.00% ~[!'l:ksllit:t\(1)t1'0'~" ~ 78 0.00% 'i;ru~f$W::;;{il\lllil\6~~ 82. 0.00% 0f)i;,;W',%ttl1~:il\!:t,j!..~Pi~. 87 0.00% y,,!t~;:"":ri16fG1::::." 1~""B
Benefits-Medical - 0.00% . 0.00% - 0.00% 9,744 0.08% 16,693 0.12% 40,409 0.26% mlW;:~B.r:1~1f~]1. .i@C]48'397 0.28% J[~:,;~~1l~~~Gl%i. 53,017 0.29% ,+lLlWW~~Jjmi~~;;1~iZi 60,601 0.31% !:Ji~i'!Jti~a~1i;jW}~Jr' _.. 69,290 0.33% ,~,Irwt ;18i~l1q))*hfr _ ~
Benefits.-Other - 0.00% - 0.00% - 0.00% .. 0.00% - 0.00% ... 0.00% jlliFl&~'i6tJ.!f",.,:sttF' . .. 0.00% ~~1~]1~~t~~f.tillLWt(~~ - 0.00% t;\?~t;;";':;;"P;;';;;;~:'~'~61 - 0.00% }i%?:t~im/~4Y;f~r,mlli~~;,t .G~1f# .. 0.00% 4~~llif~~%.i':;;r,;:~~~ptt~;; ~
Payroll Taxes - 0.00% - 0.00% . 0.00% 17,931 0.14% 24,055 0.18% 41,514 0.27% ~.ii'\~\\l;r!4S." 44,987 0.27% iil[/~[!;?tl'tRlr~~~.'w~ 48,135 0.27% ;!ilb~~~.i~l~.ltl..: 51,519 0.27% ;:d1!~'.t:ll~l,ol%' 55,158 0.26% i~~~lf~~;~~@j:;'m~.~~,,,"i9I.
Insurance 3,000 0.09% 11,254 0.24% 15,374 0.19% 37,025 0.29% 54,888 0.40% 83,315 0.54% i!J~~(~~\~~fr',%1I .. 91,647 0.55% ill.. "~!.4~1~~~,~1~" 100,811 0.56% oruw{;, l~fI,\!Jv;1ff,'~O" .~. 110,892 0.57% jiT\,~j,it(1(j,1l~fjl~~f~'~~ 121,981 0.58% Ki0mi~i@j\'08Ill;1I"jillli1j%f .
Depreciation 59,975 1,68% 103,271 2.17% 136,655 1.66% 2.44,936 1.90% 373,714 2.74% 427,605 2.79%,:~~tllc]~~';~.. " 437,605 2'62%~li0~{I~,0',~gl):".'~ 447,605 2.49%:["I)'~~~(!~;P~J~~'~.t.l! '." 457,605 2'36%ili;::.1~iQ('O..OOf~i'''i'i'I&'~ll 467,605 2.23%~~~..f~Qioooll~J:t2'! iW'
Rent - 0.00% 2.8,962 0.61% - 0.00% 221,418 1.71% 2.85,099 2.09% 335,128 2.18% .,1;;~~BQi~~~'~I''lr 345,182 2.07% ~!iI,:::',&lJ1:~~F(t;F. 355,537 1.98% .' "lt~~tlj~~i~~};, ' 366,204 1.89% '. di;~l~~X~j"'c.'tS,_ 377,190 1.80% illm;m{1P;9ael3t1illl.-il~~
Mlno~EQulpm.ent 3,954 0.12% 4,343 0.09% 1,795 0.02% 6,351 0.05% 4,379 0.03% 4,512 0.03% ~:~vff:f1jl3jr;[;.~~f~\ 9, 4,647 0.03% w~r:{JwW'~~~~~'!;i:J, "',~.. 4,787 0.03% "Gi:;;)i:fi!~~ 10~f$ ..J,.=~ 4,930 0.03% {iij:~,;~'!~i?;;;_ 5,078 0.02%m't'!S";t<XiP!l:t.'!{Ji~~
Repairs & Ma,ntenance 32,030 1.00% 37,990 0.80% 52,951 0.64% 79,972 0.62% 73,922 0.54% 118,371 0.77% HTht~'~~U:1i~;,{~..m " . 127,263 0.76% ;;rri{~~1"~~'1~r~;;;~~~. . 136,167 0.76% !i{I'~IF~i~llt"~llt{ffi ,,]i_ 145,740 0.75% ;..;,l:i2!~I~II~m~~. 156,034 0.75% L~ii'(<1:i:;~r[01iDi2!i.4tf~::WI:i.r;j"l,j'g
Supplies (21,619) -0.68% 2.7,509 0.58% 58,949 0.71% 117,854 0.91% 137,981 1.01% 142,121 0.93% :0'!!i!fji(!fl!l~Olt~.i) " 152,797 0.92% 1~ni1il:~,9:~Ii;~~'l';ll 163,487 0.91% "1;,lik~~,~~~:il(1,f~ 174,981 0.90% \';~::;(l:Ci4~~~~JJf:~. 187,340 0.89% !;~%lli';Mi2\51l!i>~:I'!;:;41~1
'~~'?i.W~~!illi- ~Mlill$ '~$,~ ~ ~ i~Ji$ ~~%t~~*;;~z~t~~fi." "Jf~ ~ ~'" to S ~~Z; ~tl ~~~i$mlll~tl~iW4A ~~;, ;..,] ;/,~f,;iliifm~~~w.H~~t BU~ lfL,i.': ,,, ~~\d\rlV Mr-';m "1 1!illfl:
. "P4Wiiit.w" '" "" .. < ,":l'~-$'~1if!Ni,*' Xc 1"'il"fi"'i*""'''''''ilii'''"Th "' '.~ir-" ..",[~jii%:€;ii~)]i"illl *i'"i".~'"" "lB.<J~i::rffil' .PAl.
~&l&"'tm\!\ "ilTh ::J''1'.!l: ' :<<~~;;;;;)C'p ~"*\i~t[J; g~~ilifWJ:~~)#.~~~~rrr.,~g't; l%Wj ^ ,t!t~~~llli:~~~,V(l~~!<<:;?~3S"~~i lilifr,:~l$lJ.m,;:i1t;;1fffiWiillllifk;'jr.#~,",'@Wil
Suppfies-lntemalProduced - 0.00% - 0.00% 754 0.01% 1,859 0.01% 1,843 0.01% 1,897 0.01% t"ij::a;;8~(ll;w: ". 1,954 0.01% ,~~ "iliJ:;~lfj~1ilJl , 2,013 0.01% 4:f~:fj"J,:~I~!~1;0:I. 2,073. 0.01%lillliml!:lf' (;:~~~iIT.,~. 2,135 o.Ol%IR~;'&?"I";"~;~!liI ~.~
Fecto!)' E~~ipment Rental 106,054 3.32% 132,523 2..78% 132,523 1.61% 167,885 1.30% 293,416 2.15% 261,758 1.70%1~[:ri~~l~$[~~~*"', 282,851 1.89% ~t1i:ll~e~K~t\."., ' . 307,851 1.71% ':"0J~~&~~Jr:~~i;~. 332,851 1.72% :,i!~~~51J~li~,'!li. 357,851 1.71% l\gt.2:P.~~plII:
Facto!)'Utilltles - 0.00% . 0.00% . 0,00% - 0.00% - 0.00% . o.OO%\iIi1IlrB;;~i!Il~~" - 0.00% w~i;~~;cri;?j~~"t. - 0.00% '~h",,;gi!itf;Bruff"~!lf.~ - O.OO%WY,,ii, "'",",w,gl!li - 0.00%1;!1\lllf!!&1~",;m;Ni~i'i!lr.lPR"~
- '81~~~~'hl~11r~i.r~i0.1~~~ " ~_;l~i~i~;i~!~~~~:~< ~ :~:'W:l~~1'~~~!~fjJ,:~rIJl. J ;:~v~~~~':;~t~~:~tI~~lli. ]tli~~~]~l~di1illf~i.i1f
Rubbish & Waste Removal . 0.00% 623 0.01% 1,968 0.02% - 0.00% - 0.00% . 0.00% d'iiLJii!'ifr,.,.mffGil1lill ~ - O.OO%'"_.;k;j~,.",?",,,,,,,_fii - 0.00% 'pf;f,f;f;ilif;i!'1\""'f:" "01iQi~ . 0.00%,.-,.20,1loji: N;.;';U;!llil'& - 000% "'"l''-~''o&'''''ik,",''' I
Freight & Postage. Charges 40,412 1.26% 61,647 1.29% 49,863 0.60% 128,223 0.99% 236,880 1.73% 220,m 1.44% ~m~~JJrl~~lb\lj;1~f. II 243,503 1.46% ii]!I~~lt::jll. ,~ 267,853 1.49% J:~;m!;R~~~m~l~ ':,~ 294,638 . 1.52% t,~:~~'2~Z~~lTi~1i8i~1!; ~ 366,337 1:75% :~~,~~I~I~iit;~ ;. ,,~
Employee Recruiting - 0.00% 805 0.02% . 0.00% - 0.00% . 0.00% . 0.00% "",,,"',~4iW.i ~ - 0.00% ;W"i"'lJI",n!l4:11%Y!Ml['!:r0 . 0.00% 1;[; f I'. '++If;I!'"~;;;''!'lIii . 0.00% 1;;- >,m'~'lw'd~'~ll'1;i!::!i,fi{jj - 0 00% ...,f;,r:'~ "".i!1';' ,,.'\If''
Employee EducationITraining .. 0.00% - 0.00% - 0.00% ... 0.00% - 0.00% - o.OO%;:::ir~~~~~tWi~~~i\~M .. o.OO%I~1r:~;ll0i~:'i,~~~~m tJ' .. o.oo%~,\~r@~i\~"l?"'~ili~~~~~''"' - o.OO%<:~:':f!,,~:~~:1srrm~~~12] - o'oo%;;~~>>~~"-;;~~"ml\~,~~.'" 0;
BUSiness "Travel 57 0.00% 29 0.00% 804 0.01% 11229 0.01% - 0.00% .. 0.00% ";~~~Th ~~i,;:,,:~.1fJf"~~" , .. 0.00% ~"'it~~f~t~; y~~,~ ~ - 0.00% ~J\mJrf..;t:f.W:1~m[~L:((f! " - ~ 0.00% "'\~~,~.,,",,;,~~;!lli~~~Rt~(', ~ .. 0'00% ,~,~i~!A :'};g!!!~~("=V,;~~~~~~I.~'
"ii<'iiO,:S:Jx~' y~~ ,;<! ~ ~? ",'" .~". ~"": ,li 't< ~ ro", _. . 1 '''~/.~~I~ , ~"" ,,,,",Y::c<;, . ~. "~"!:'ii,,...~ /.,.~i~W.
Dues & Publicatians _ 0.00% - 0,00% - 0.00% - 0.00% - 0.00% . 0.00% ,:~%:"1~'i;!!1ii\f''1~4:k . . - 0.00% i~1!rfi~L:,,"ji:l . " - 0.00% 3\~;";;,,:'",;;/ :;t'f<'(%lk, ., 0.00% :",,".?",~,,'w,W,0iill" - 000% ;':;H:iiI\;0ilHIT1f1f'~1!l1fil;
Auto &Truck Expenses 512 0.02% - 0.00% 288 0.00% 374 0.00% 1,965 0.01% 2,024 0.01%,~,m;';*@m:gi!f. 2.,085 0.01o/,'\~~i":f;j,(l~it~~.: 2,147 0.01%:WJ!l!~'I\~,:(a.a1(t}~"," 2,212 o.Ol%:,~);~~";';o/f~)~:!~~\.' 2,278 0:01% "fi{'":JJu[{~dWjfj';~; ~
""""'''''''''-'-' """".. ","" .,,,. ,.."...,. ,5."" <,.". '" "'" ,<"" ,,,..,,, <.". ,"'''',...,. ~Olli '. ,,,...,, <2M\ ,,\il~". ,,,,,ml <,.. ..! ""'" <"" ~" ",,,. <"'. ~~
Intemal Job Cost Recovery _ 0.00% - 0.00% .. 0.00% .. 0.00% .. 0.00% '.. 0.00% ~;>>:~~d;~J",,~>,~Jf(#f1,,~qt - 0.00% %;ti{i~~~t~~lii!%~.~ "* .. 0.00% iJm~J9~:i..',~t(;jiV~,,~rd1~~ < .. 0.oo%11t~:~~Jl~~1[m!\~1t~l<I~",1:~~W" .. 0.00% ,~t;~;:1!~lf01~~f.~Z0;'E~~~1i ~ 4
Total FactoryOvemead 247,326 7.74% 408,437 8.58'10 446,643 5A2'1o 1,242,134 9.61'10 1,199,449 13.17% 2,126,801 13.86% ~J~~it~~'ll!itl~I.!ttl).f!l~ 2,262,631 13.65% ~1G;~13,6i~~!!lji:mHi~; 2,406,486 13.37%ili:1ft$~!!~~1'18~:~ll;:~;~~;"~::.'l!:a' 2,559,39213.19%m*mt~~~!~~~?llmtt1iJ,$;as~ 2,764,423 13.21% l"':"&l2gS;~1Ik"",.';,i\fi8!0i ~
?1:.rll1rj~WJ.~lli~i~l ~,.~ \f0,m'PI~~illii0llimi!ill~J* " f,~~;;itJim~~cY"'d;ro'"ro "y~"t'~~ * 'A Jr>l~~ ~~ ',~f:~q "?!lg~ 1~rod~ ':::'1";m~{;;;~:Jh~>;~~;<lliW" wii
Total Cost of Goods Sold 2275659 71.21% 3184870 66.89% 4961875 60.13% 9702344 76.08% 10091153 73.90% 11838619 17.11% '*li~*i#~~~II!lf.~~iH't'l, "~12687738 75.98% '.;{1;(d911ii1~)~~* " . 13639245 76.24% ::::~Rili'~1tdr\;":i:;" iii', 14455132 74.60%ll!jWti~1i.i8~ii;i'i!i!ll'~. 16483321 73.96% 0~1~"j$i'~'~i~~;';'.~""\
Gross Margln 920,162 28.79% 1,576,197 33.11'10 3,287,006 39.87% 3,221,099 24.92% 3,565,836 26.10% 3,615,017 22.89%llillijm0~~J,~:1~J~. ~ 4,010,862 24.02% :.1~,"'10;8~2Y';::;;if;Jll] : 4,455,265 24.76% i'ili!~~~26~~:[f"~~fl;&A~ 4,947,563 26.60% 1!i1~.~~171~~J.)ij!t:Mf;;Y~~Or. 6,450,224 26.04% ,.,('~, 5O:~24;llii1ifl.'w.jjQ'i,~
{:'S.L~H~WfN~~ill~.lt ~ ~Jg~ '~ i:r :t;~~;~~Y].~e'~~::: ~~ ~(1~:~{.~f~ri:~;~~f~; *iI;.ffi _ ~~</.~ :: ~~ ':~:'~ :t~~::t:v:~t"~~~lt!l~ ;, ~~ ~:'::"~;fJt~if~ ~~~m~.II~$
hly~"Jt;i~J.{lliiilllwWq~g:.,,,,,"]f;~ ..$f"-<> ",>;{1r.~'~",~?0'%;; ~'~'''':.1. '*~ ~~0.;',>':'J'''~!f".t;it;f'C~:<<<~''}~ ~ , < ~~ ~ ';V" ;-;;'~. ~i~?~ ~~:. , """ "d~':<.: ;B.~~L~.\:
~"W" "."'w ~.",*t~ W. - ^'" '" "',,"iW,;; ~~ " x<"'~' "'~v" """" l ,~);"~,, .~~~'" l1 .11< " ,,~"'~~~. Jr, m~tii:- , ,,~~~ Jr,', >:,.", ".",11; ,
Selling, General & Administrative if lli~1ii:!filltf.N~11~f!~~ ;f."" r~Jk~R~h~t"", ;~y;1,,:..~ ,,;0;, ~r,~'tr~~1mij!:::)w.~~~~; 7i[lk~ ~ ~,'1X:',. ~,~ .;>1;,,,' ,m ''',,; ~~ l:.i~'J.; ~m~1f,tJ1Emkf;R~Fillr~~~~
~M~ ;.!;. ~ li'~ilVt@ " h"'.rllliEti1~;: ",."~,,,;r,~ v;>. ",,:::~.li~y. ""*!i~ "lfu~""_t ~.~" ~!f~ ' , _" :ii!~~J.f /.;x"" ';",,,::;;!:d~1H ~~ lli~41"i*,~
Salalies (From Personnel Schedule) 572,394 17.91% 832,131 17.48% 1,356,700 16.46% 1,561,763 12.08% 1,692,124 12.38% 1,548,375 10'07'~I~!~i~'i~;i.;49,:;I"tK~1Jr~,<ft\ \' 1,731,307 10.37% l:i~11~i91<(~I;""~:; 1,916,726 10.65%m"dH~5:~;~)~f:~~~~1~ 2,119,270 10.92% :':"ikO~~~!~~~"Nf~' 2,340,526 11.18% /';;~~~~i~~gm1,\1'
Bonus ProvIsion 41,400 1.30% 36,072 0.76% 99,801 1.21% (36,788) -0.28% 87,945 0.64% 110,563 0.72% .;;,t\~~~~ht ::~,.~ 166,986 1.00% ."s"l:~S~;ifwt '!'~I:O'~ 179,945 1.00%'~'''ilf':(1i2,95~ri~~mm:~~I[~ 194,027 1.00% ;.,,',.{1;4,0821, '~:iltEk~3~ 209,335 1.00% '"1::q~)~i!5,tlq9,r:. ;::~1~t\lI1J~
401KMatchProvislon 22,016 0.17% 21,950 0.16% 22,609 0.15% "Jrj{jl;j~!";~';1!1i9-Qj 28,666 0.17%;'<,;~W~lli~,~I'..,;~:,'1 ~ 31,090 0.17%1"0'''iili!n2;4~!ili;i:ii!~~:~~5,o/iJ 33,716 0.17% ;",>;{2,6:<.\1j'Z'c.jIl'l_ 36,563 0.17% ;~0;[jl{~I!tl7!l",";iJ;ii!_'I'';
Payroll Taxes 62,637 1.96% 55,672 1.17% 90,571 1.10% 98,210 0.76% 110,322 0.81% 124,558 0.81 % , ::: ,(14,~~1.;_:"~1:_ ., 138,505 0.83% !ii:::mU~~;~4l:U"..,H,l' ~.B 153,338 0.85% "" [;[ {1~t8Pfrl;i~':i:M~~.' 169,542 0.87% '''." . , G16l20ijJ. :;;'..10" ~ 187,242 0.89% " ~ :~i~~~l'tQQF c; .;,~:r1."~0)
Benefits-Medical 14,195 0.44% 24,920 0.52% 33,455 0.41% 39,106 0.30% 45,309 0.33% 58,484 0.38;' "..,,,,;~~~ji~~,):~i~~~ 67,150 0.40~i~.'"'f11 <~I~"i!~~I~J"~'i:;;.ii!4; ~ 76,732 0.43% .~!I~~~~9\~~l~wj'rmm~~!l~' 87,707 0.45% "~:, . ~(j191~':;f:,~1~i~tffi 100,284 0.48%11f"~~ ,~;2~.~;~~ii!!~2'5"ZI ';n1.~lifi
Benefits-Olher - - - - 0.00% . 0.00% . o.oor,"..~ -,llim<<~.fd - 0.00r. ,,', '~7''-I"..."rl~ ~4. . 0.00% , f;{S. o. .-"".~. , .'.Og - 0.00% ", , '1"1 < .;,~:nil!lll . 000% ". . ,~ . " , 0'00%
Marketing &Promotians 665 0.02% 8,361 0.18% 14,945 0.18% 15,571) -0.04% 256 0.00% 264 0.00% ",:~0~illi;f~f~ajl~~~J,~1~: 272 0.00% ',;:'::"~'I$~<,'f~L,..~,.~ 280 0.00% ,:'i~,.f,<!i:(ehi{[r;i~~ 288 0.00%., > . ,,-'{al '; "j;l'9m~ 297 O:OO%:}' <, .~lir~~\Li".i~~~:.
Promotion-CustomerRebates - 0.00% . 0.00% 3,060 0.04% 414 0.00% - 0.00% - 0.00%, ':c,L!>j~"i....,,~...:slgiQ!lfo - 0.00% . 'w,::: ~~:'''::::f.~~ - 0.00% .. :""7:;:,~)/~'.' ll."QQ.11i - 0.00% ;..:>2Y.~. ,:.Il,QQ!l!i. - 0.00% , .?<::. :;:;;f;Q,il'!'ii.
CPI P&L FORECAST.xls
NuQuest .r~:, .
Employee Recruiting 0.11% 141 0,00% 0.01%
Auto Expenses 0.19% 13,881 0.29% 0.08%
Bad Debts Expense 0.00% 10,488 0.22% 0.96%
Donations & Charitable Giving 0.00% 2,748 0.06% 0.00%
Dues & Publications 0.00% 75 0.00% 0.00%
Conventions & Meetings 3,106 0,10% 240 0.01% - - 0.00% - - -
Business Travel 13,346 0.42% 34,239 0.72% 10,726 57,247 0.44% 57,583 59,312 61,091 62,924 64,812 88,756
Entertainment Expense 1,655 0.05% 1,659 0.03% 1,791 788 0.01% 15.418 15,881 16,357 16,848 17,354 17,874
Outside Commissions Paid 1,327 0.04% 350 0.01% 500 - 0.00% 7,332 7,552 7,779 8,012 8,252 8,500
Professional Fees-Aud~ - 0.00% 675 0.00% 695 716 737 759 782
Professional Fees-Legal 5.474 8,553 0.00% (68) 0.00.% - - -
Employee Education 7,673 3,442 1,895 0.01% - 0,00% - -
Other Professional Fees 88,603 2.15% 3,418 0.07% 1,881 0.02% 4,061 0.03% 1,803 0.01% 1,857 1,913 1,970 2,029 2,090
Vending Income(Expense) 0.00% 0.00% - 0.00% 0.00% 0.00% - -
Employee Recognition 7,236 0.23% 13,280 0.28% 29,891 0.36% 30,634 0.24% 37,163 0.27% 38,279 39,427 40,610 41,828 43,083
Office Supplies/Mlnor Equipment 5,596 0.18% 10,015 0.21% 18,498 0.22% 14,702 0.11% 15,270 0.11% 15,730 16,202 16,688 17,189 17,704
Office Equipment Rental 0.00% 0.00% 517 0.01% 2,607 0.02% 3,239 0.02% 9,448 0.06% 9,731 0.06% ;
- 10,023 10,324 0.05% 10,634 0.05%
Repairs & Maintenance - 0.00% 340 0.01% 920 0.01% 2,910 0.02% 427 0.00% 440 0.00% 453 0.00% 457 481 0.00% 495 0.00%
Internally Produced Supplies - 0.00% 0.00% 32.413 0.39% 32,828 025% 15,249 0.11% 15,706 0.10% 16,177 0.10% 16,662 17,162 0.09% 17,677 0.08% .
Aexo Management Fee 479,373 15.00% 451,800 9.49% 313,080 3.80% 247,168 1.91% 297,672 2.18% 244,491 1.59% 251,826 1.51% ' 259,381 267,162 1.38% 275,177 1.31%
Telephone 1,648 0.05% 6,573 0.14% 1,638 0.02% 6.482 0.05% 7,445 0.05% 7,669 0.05% 7,899 0.05% . 8,136 8,380 0.04% 8,632 0.04%
Depreciation 465 0.01% 1,251 0.03% 4,092 0.05% 4,711 0.04% 3,070 0.02% 3,618 0.02% 3,727 0.02% 3,838 3,953 0.02% 4,072 0.02%
Insurance 1,418 0.04% - 0.00% - 0.00% - 0.00% - 0.00% 0.00% - 0.00% 0.00% - 0.00%
Officer Ute Insurance 0.00% 0.00% - 0.00% 0.00% 0.00% - 0.00% 0.00% 0.00% 0.00%
Office Rent 0.00% - 0.00% 517 0.01% - 0.00% 0.00% 0.00% 0.00% 0.00% - 0.00%
Bank Service Fees - 0.00% 804 0.02% 13,815 0.17% 8,315 0.06% 15,178 0.11% 15,633 0.10% 16,102 0.10% 16,585 17,083 0.09% 17,595 0.08%
Early Payment Discounts (18) 0.00% (282) -0.01% - 0.00% - 0.00% - 0.00% - 0.00% - 0.00% - 0.00% - 0.00%
Mise - 0.00% 50,793 1.07% 32 0.00% (15,057) -0.12% 172 0.00% 177 0.00% 182 0.00% 188 193 0.00% 199 0.00% '
Sales Tax Paid 0.00% - 0.00% - 0.00% - 0.00% 0.00% 0.00% 0.00% Y . - .0.00% 0.00%
Total S, G & A Expenses 1,284,675 40.20% 1,572,116 33.02% 2,105,443 25.54% 2,215,050 17.14% 2,571,020 18.82% 2,438,911 15.89% 16.33% 2,969,230 .16.67% 3,522,585 16.83%
#nfll'~~1lf'" 'Pr._i~BiIr,jS _mR_~M"M!IIr'~Di\1l~~~.q1~j'
No eratln Income Ex enses)
Gain (Loss) on Fixed Assets - 0.00% 0.00% - 0.00% 194 0.00% 368 0.00% . - -
Recoverles on Bad Debts - -
Gustafson Bulldlng Income (Expense) - - - 0.00% - 0.00% - -
Interest Income 90 0.00% 80 0.00% 0.00% 1,176 0.01% 342 0.00% .
Other Income - 0.00% 0.00% 586 0.01% (3,132) -0.02% - 0.00% . - .
Earnings of Subsidiary -
Finance Charges Income (1,660) -C.05% (1,359) 3,248 9,403 371 6,800 7,004 7,214 7,431 7,653
Interest Expense (4.412) -C.14% {73,989} (67,512) (90,149) (87,295) (110,130) (113.434) (116,837) (120,342) (123,952)
Other Expense . 0.00% - -
Penalties & Fines (411) -C.Ol%
Current Income Tax - 0.00%
Non-Operating Income (Expense) (6,393) -C.20%
; fm;t~1l1lli~A! it~18llt'$.'!j;iWlf.~iI[6lfoz.' ;;l~lt~
CPI P&L FORECAST.xls
Chaflenge Printing Inc. CONSOUDATED 26-Jul-04 2:58 PM
ko.OOUO"'" ~..,. 'ji,', '1t'_.~. ~~__~-.~_",' ~~ _-.IllJIIIlIlIIiI_
ljaes-t-'nmi""Woucts 37,668,724 93.98% 37,805,569 91.45% 46,032,580 88.80% 49,749,898 85.51% 58,726,107 85.46% 67,540,500 66.72%,i\illlWa4"..@~3i1j~Ii1TIi1!t ~~ 17,420,926 87.41% '-~.0~~~t1~!::'i\lJ~~1~~! 85,163,018 87.77%1117~p9~'~Jr.Jl1lb~ " 92,181,927 88.00%:~:%q;,ail\1j~~1~1.NfiJq~ 99,782,935 88.23%I'illl;~il\8Q~i~::[i:iHi:Jm:!cllg
Sales-ToCPIINU - 0.00% - 0.00% - 0.00% - 0.00% - 0.00% - 0.00%j,r<*8!'ilt\!i~~~!iiii(~ · - 0.00% o,lli)M1i&nifj,,'Ji,lffitpjM - 0.00% <:]jllli1~):d~lliiJji:" .'t - 0.00% ~~jjj,,':,,~i;/Ji1~IRlj . - o.OO%[4ffit.%\~~liili.iijgti,iil!l':.
Sales-FromCPIINU - 0.00% - 0.00% - 0.00% 3,111,984 5.35% 5,065,552 7.37% 5,409,000 6.95% ~i~y,~Jt':~i~1Z ~ 5,679,450 6.41'/'IJ~~~;~~'~ilTh:iW'A 5,963,423 6.15% .~"2I{ill~~i&&4W~ ~:: ~ 8,261,594 5.98% 1~~,m:]!1P'ii~'~II~ 6,574,673 5.81% 1Ki.Jlti~J~I{q~@b~jp' .
\EquipmentSalesRevenue 237,311 966,312 2,360,148 2,089,164 1,410,494 950,000 I!!l;,'%, ):~[t'~t!, ~ _ 978,500 ;llr*rir~' .1l","Y~ 1,007,855 {mmll;~@1I;llir4liM' 1,038,091HmgiY:,'j;N:;iJl-*[j~tm~m; 1,069,233 m.~o" :,."'iI1Ii,{!lrm\Th'f1;ili
Freight&PoslageCharges 2,201,883 5.49% 2,494,n4 6.03% 3,159,807 6.10% 2,864,856 4.92% 3,079,518 4.48% 3,587,313 4.61% ';:;:1j15~lIoSrll~r~I~{i t~ 4,112,974 4.64%::ft~i~I~~:~II~l~14K11r'i' '.""'" .....~..". '.'"'''' .."'~..,.,'" ..",~,iit,..J
OlherChargeslnvolced 268,261 0.67% 354,464 0.66% 572,516 1.10% 793,091 1.36%828,140 1.21% .803,566 1.03% ~!li"!l~i~~4'f01'ii!i''1'tJl~~ 843,744 0.95% :f~~[~;~7,,"_;:,;?i#:~ ~ 885,932 0.91% ~!illI~~l!t~gif;8rt~, 930,228 0.89% i~(~!~1i!9~~lt!H~'li,. 976,739 0.86% c1~~0~lI~~Ji#:;t;si~o/iI
EanyPaymenlDiscounts 1293050\ -0.73% /279,860\ -0.68% /2853581 -0.55% 1431.3411 -0.74% "'92096\ -0.57% /407,183\ -O.52%-1.~i1I'frjfji,oj;j j"lli]Iif1~. I 1467352\ -0.53% rj(f~16GI!iJlll,;n;!~t o/iI /5140871 -053%mNN~lif4$l7!ii5w:0"~~ /555,6541 -0.53% 1:)l1!ii;!l1\111!;~W!ij1~;""",,,, 1600,5901 -0.53% ",;;'~j!Ii1I4!9.3111;"!;JV;i'J~1
~~~~~ iA't}Jji'!mim!:~~t%~m~a~!~ r-lm'.Jitaml1!l1'h "Wa11iY~~llqr4i~~!~{~'tqq,qq;~ ffE&"~~1,V,i~tO,;PR~ r~li!,p,~~7!~~i1B1!~~. 'ill8.~J.i~j\lA.g!t~~ .,~lIJs5glfM:w,~1'J~~~~ illE1!1Zl9Aq:~t~ilii.:;d!l9SIQll....Xi ~':;ji~f~~8;111'tiQiii~m~ !fJL~!!il!:l_fgl4gq~ [,*7~'i6iIl71%W)O)";m,Wiii,~1~'!lqtmr~~.m\JJ!!Q;'&, "ii~i~13l~6~tl;,mi.1f::llfI"~~
(~~JtI~~)f)!~'W~@I~~~~~ ~~fi3~:;;~m~~~f1Jkf~~1 ~~.~~j~~jlill~;;B!~ft~ ~il~~~Y;~~;0%.frill~b~*i*II;m~:~ ~'f~,f~~al~i~a~(I~*i"i ".
I Cost of Goods Sold lli~ltdm~"@'f~iliffi\~1~f1i ~E~mliJ~ltl~tf.;4~ili1i~~ W.!M/III~~~3.:~~;r~~](~~_ ~~'~~tZ?t~mw~,;w .~.~ ei~t~24~'trl.llliB
;~~~~t~~~.~~;t~;jx ~i':~ l' ~~S;irfu~;~~1>f.1~~~~4rrf.~4:~l'i, >~t~4~!~':n,;ilit:~~~IT~~E r~t ~J>>;Pt~~iTfTI~~~"ftr ~ j-dt. ~}J.iit~'&[%&r~tW~~~~>E
_~_wr",_~.l,,'il%lil%.~ !!11"'"&il';<~""~"I,,'w . 1[~."f"~;I'~"" ""Qijilf,v,:w&Im2!, ~~"iWmHjfAJI'm",;t,'".t:l,wl' ',,' Fffl~!"""ff!f:i\,8el;tll.\il!:' "P';1"''''8iU~%.'jjili!4!''L,". ,
~.&W':J~%WSl>>la~~{t~~~~ ~ >:<.t:-><w.x,u",>w*$l"'>>>: IT ~ >l ....,~"'>>i'!i".,x"';o:xr,?,r",:~;ruml( '" " ;>>..1l:~'" '0.?i>>:,,..t,m~"~ "'" t@!~W.if,~'" <;~$;;.w.%~o';; , xAfu!Jmt"''''''=:ili~mt,''.,,,:,.,,,,iliill.j,<
~" ~ ~,~, I~ ~k<<~~9[ttt.iC~~t!lit '7~ ~~:'tr~f'f~~;ru~4~1!t~rmft ~tl~~~~I;t;~f~~ 1:~~]t7t~~I~lff~~%t ~ '~~~~::JBI~;:m~~~lli~ It
Matertals-Paper 9,354,710 23.34% 8,406,844 20.34% 9,595,149 18.51% 11,405,976 19.61% 13,981,82'3 20.'35% 16,533,724 21.23% :~I~;!i!t'(r1;;:-:?.itI,~; 18,866,787 21.10%lkJj2'1~t~~~L'f!l\11~:9i1 20,416,516 21.04% fllil4j~;iJllfk1111:~ls~'1' 22,009,085 21.01% ~!i?~2~}J;~"~liI~~,1 23,729,754 20.98% .i~it12\l,!l~PU.1"f,:<,,*
Matertals-lnk - 0.00% '383,796 0.93% 517,795 1.00% 1,086,815 1.87% 1,088,992 1.58% 1,248,603 1.80% "'ll(j!~!l;~~);l'W1~lUll, J~ 1.415,667 1.60%l!ffii~~:q~i:Ntll~P 1,547,316 1.59% $;jlliW~1~i\Jt!91:T~~. " 1,668,003 1.59% ;~~I'!\{(129~Ili'i!tE"lk ; 1,798,376 1.59% 'iI:';j~&t?O,~l!~i:i:1r!ltt' "
Matertals-Coatings - 0.00% 113,081 0.27% 217.733 0.42% 606,240 1.04% 480,749 0.70% 553,807 0.71% 'r!'~1Jl.QJ!JF>:1f1~q' 627,570 0'71%~ii;,*0lii[3i'ZJla)alll~' 685,249 0.71% m~I!t..~$l:1;r;" I 738,707 0.71% 'Bi'];1l53;4~Y"~~;;l*.. 796,479 0.70%I'F!':~tl~K$1;~1~'8b~ii ~
Matertals-Proofing - 0.00% 344,167 0.83% 547,474 1.06% 445,311 0.17% 433,ne 0.63% 491,160 0.63% 3~~Jm7j~~t~~~~'l,~'{g 581,227 0.63% C:~1ill\l:~,~~ill:llifl~ :' , 614,771 0.63% .ITI'(~~~43,jjf0"%ii.: 662.695 0.63% ~~t!'J.~t:~2.'t)?'m1~ft~ 714,411 0.63%[!!h',~~~ii'?nai1W.~~~!t:~
Matertals-Plates - 0.00% 308,909 0.75% 765,655 1.48% 1,161,059 2.00% 1,346,349 1.96% 1,541,730 1.98%I:llIm~Q~>>.i1).1:ff;~~ 1,742,443 1.97%!:~t\N:lj!QQ.7:t4)1if,~iL.~ 1,904,593 1.96% ):,]r,152!ii~L'fu"li!~\l" 2,053,140 1.96% 'lii0K4,~:54~l~~~m.$ 2,213,594 1.96% 'j;~~g(jfll4\jJ:';lW1e2 '
Materials-SpecialityUVStock .. 0.00% 17j628 0.04% 60 0.00% 360 0.00% 412,651 0.60% .. o.oo%'illmNtk~~,~~q~~1i}~r[~~~J?9' .. 0.00% ~~tit~~~Wd~j!Jt;~~}tt ~~ .. 0.00% .~1r"i~~4:~~~.r.~ilt; ~ - 0.00% <J~MW0~~r~~ i~;5]1~i .. 0.00% Z~0i~ill~~~~'!&-161
Matertals-Other 440,527 1.10% 535,947 1.30% 727,659 1.40% 1,065,067 1.83% 1,766,206 2.57% 2,001,017 2.57./,I~[~"~,.r-illtill 2,275,3'35 2.57%r,4~\'WW~Jm~iigl,/rg, 2,492,158 2.57% .!J'.61~t~i;tf. 2,666,438 2.58% 11{1~8ar~,;t.ffi '2,896,099 2.58% ~[tJl?jl~;~1!it.;~"&l
InvenloryValuationAdjustment 207,905 0.52% (31,603) -0.08% (37,414) -0.07% - 0.00% - 0.00% - 0.00%r#~lRm;:'1"1"'A"lli!JF.'i!i~1 - 0.00%1!1~:r:'*~tl;" ;,}1J ,0ji i - 0.00% ,:; ;0'1Wf::ew"@".,iil, - 0.00% .tt;lt'""*;~i';~;4iN~~:"v. - 0.00% j~~ll~,(Jlif4ri'g:;l%ffi1f% 'o/l
Purchase Discounts/Allowances (181,701) -0.46% (192,628) -0.47% (237,182) -0.46% (278,085) -0.48% (353,228) -0.51% (378,742) -0.49% 111'1:ftl:ld,!~B~~~~f"'UR1~1'f& (432,681) -0.49% r.it~W815~;ll3g~:,%~~,t,,~, (473,642) -0.49% : ~~=ID;,~Il~'ll:0XFJ!I (510,570) -0.49% ~ml'!t1{$6',\l2a~1~; " .., (550,433) -0.49% '{fTItfh;'~9i86l!1'j,J'",.
Scrap Sales (60,012) -0.15% (92,158) -0.22% (38,498) -0.07% (59,808) -0.10% (90,804) -0.13% (102,267) -0.13% J,;;fGl~J~~3~?,;;A1~. (115,472) -O.13%$.T~'3~g~,?,:"A,~!l:~~~ (126,604) -O.13%.0II$~~:i!l;~aJg~q/~'~ (136,472) -0.13% Th.~'l~~6'Z5::JJim;1t: rg.~~ (147,115) -O.13%'.~~1!l19;~lji:li:~~
Purchase Rebates (752,937) -1.66% (654,651) -1.58% (696,331) -1.34% (780,853) -1.34% (934,634) -1.36% (1,054,654) -1.35% :1~;:1;!,~,tQ3~~11'1!~.~~ w (1,203,878) _1.36%~t~ijrm~~;~it~l1fb.1!<!I"'i~I!l. (1 ,'319,6oo} -1.36% ~~~~~I~J01ml.; il1 ;t~ (1,422,453) -1.36% frZ1l~Il:5,~'1~ri: , ,,~: (1,533,411) -1.36% :1l~~~~~~~~V~!~PI. ;
Cost of Equip. sales lMiscVdorCredltS - 0.00% 808,141 1.47% 1,609,245 3.10% 1,351,585 2.32% 894,949 1.30% 598,165 O.17%m!;tl~~:;E~I"Hj(~;~:. 621.348 0.7o%m!:ii~!~3,1~i:rH!llitl. 639,988 0.66%r~1~~~~~~\!;:~Ii:Lfl 659,188 0.83%'i.ll!!ifq~i!;l~~' 878,963 0.60%ft~;riW.i~{'~'I~J1~\~~'i:~ I
Outside Pnnting-From NuQuest - 0.00% - 0.00% - 0.00% (O) 0.00% - 0.00% - 0.00% 1ill~:;j'Y~W;;i'ii;d;iiliA';'\'i!L - 0.00% d ill~~.]"Iill~ill"JI~,w - 0.00% 1.;~I~I€:illf;i,!!:~+1,;Wi~s!!'JJ;'!! -. 0.00% t~iJ1.:;jill.~!Wit1~"I~"" - 0.00% ~~~Jl'''jf;'t~T'GB;;':itf;1 ~1
OutsidePrtnting-O\her 522,17'3 1.30% 483,658 1.17% 842,444 1.63% 51,527 0.09% 1,767,339 2.57% 1,991,362 2.56%lil~l~~4l!12:3)jt.i~~1~h 2,270,944 2.58%:/lif.R9J~~t~?;;!t~ 2,489,888 2.57%~1ikt~~~.~I\L~t~~9,~~ 2,663,944 2.56%~t~m~~~\Q~iI'lff. ~'~ 2,893,268 2.56%~~..!f~~~~1j:"f'ik'~~"
Outside Services 2,327,316 5.81% 1,994,291 4.82% 2,624,185 5.06% 4,446,507 7.64% 4,422,817 6.44% 3,712,720 4.n% 0<[f!OOitlt,!lBit$:i!tR 4,232,042 4.78% "j~(!1 "'~~~&, 8.'10 ,'i'I$\llli 4,637,922 4.78% f;'\fJf~5,;l!lil"lli'~f;:;'e'1l~ 4,999,430 4.77% F::rl~:!.':~~t'fJH;~li. ~ 5,389,461 4.77% ,,',*P'(pso;~~.1\~;::t"~mi
-..,00...... ",,000' ~.,,' '"'''''' "",. '''.'''' ~.... "''''" ..00" '".''''l''''' '".''' ~""' ~,~ . "'"'' ~.OO"'~. "'.""l ~"'" ,~: ~~ "'."" ~.OO' ~1I-.1 "'.""> ~.... ~il8l~ ;
Adjustmentforlnventortes 421676 1.05% 23,593 0.06% /665749\ -1.28% /696143i -1.20% /201295\ -0.29% /810rn -0.10% fll&~r~~1llltNr!itllJilji 49980 0.06% .,1mIH~o.'il':qa)lt.;;;,~ij;mjji\ 55740 0.06% ;)'1f;0~le:t\li~,. 60067 0.06% WlH'ttfiff(itll2'tx,mM'illtw!s" Wl 84699 0.06% ,1WJ~~@le3lt;Jfg~,"B,~t'l\.
Total Materials 12,226,594 30.50% 12,208,778 29.53% 15,727,368 30.34% 19,756,715 33.96% 24,971,629 36.34% 2"1,005,8.75 34.67% ;~i~~I'!jl~I;414~6ilt01+i~~I;IL:G~ 30,679,626 34.64% .~a.6[~;Z~!#Jill:~~!i~ 33,505,214 34.53% ';L~$'~~i~~81I.ft:i~91~1~ 36,087,515 34.45% ~~2;582;~02lfiillIfJ. 38,8.75,492 34.37%~i,I!Il~i787i8~!0rill;jT4 3
~~_+~;j~~~wf(l~~~ ~~: '!~}!J.:~f~~~WAf~~II:;~ l~ ~~~illillltJ~ti~~r~lli~~ v ~1~t~?lt~JP;1~~j~l~ %\. "~~;i01f1ll~~~~~0~ '"'%~
m;;"~"'.-'~~'11~il~ "~""{illl"",'t\~'",0,'1Htt, , .-iir;"""'';;~.llif!!,i · i:i1~!L""nji:i~iT0aJl. ,;j.~J.N1illi..tl;~W.. a "''lliA.'''liiN!illtirlil *'., .
~~~~~~~7&~,..~!f~ ~~ill~~~~.g,<xx,,,)~w~011immt ;'<>:,1,~"~&i;lliJ;ill~ ~%.? '" >:;mw~~iITj(~~ 0tf~:Wtf.jlt ~ %.\t~1ftt~0;i&f~~t;"rllE l,;,x;lr~'yf ~1W~:';>~*'?~ ~ ~ ~
,i.H~~f0[~1WtJmi~if:0~1i~@i ); ~" >~ill ~JM ill ;1tV''''>> !l:!:}fW..xlf':'; ~ ",'" f..~*t"l'" xw'" >W"~W;.':<>l'1;"'~&.i;~:= W'~~)t';:f,"'" ~'1ll1~ms&$ :1') ,,< _l?;J ~~ ,,,~J~,,J,,,A"%.";->>' ,tt~~:.> ~ti~
DireclLaborWages 9,420,517 23.50% 6,419,904 15.53% 6,915,870 13.34% 8,002,521 13.76% 8,835,993 12.66% 10,794,534 1'3.86% .~~~jl~i':;i9~)l'1~J,l!t~'~ 11,852,470 13.38% ;:,~~iQ~iE~'~~jll 12.775,661 13.17% .l@mIi~l!1i~~i;f~.I" 13,672,098 13.05% ~i!t~~'~;PJj~",t; ".JI 14,532,561 12.94% (.;t~lfl}ifm~I~~
Overtime-Direct labor 512,321 1.28% 402,944 0.97% 517,408 1.00% 559,642 0.96% 739,789 1.08% 733,201 0.94% l;^!!",!!(5$!!i;iI:i1~liLliYci 777,193 0.88% "'nfi~1l![:a},0!",jf.,g 823,825 0.85% ~~{~~~5\t2lt~@,,.p~~.."' 873,254 0.83% ;~f1;i.l~29}t1j'~' " 925,649 0.82% m!L~~,l~~,~!!,$J.~tJ", .'
Bene1its-Medical 370,722 0.92% 385,393 0.93% 438,686 0.85% 568,023 0.98% 683,082 0.99% 872,582 1.12% ~~'tl11111~J;1!lrri~~.I~. 1,023,619 1.16% J~~1~,Q~~~I1t'I' 1,178,495 1.21% .rJ[4~i!l:Z;(ll!lliW~f&\$11' 1,346,896 1.29% l!r7:t~~~ilt01;ri~'(:~' 1,539,472 1.38% 'l;r'@;f~2~16}i;;;.~., ;
Benefits-Olher 42,306 0.11% - 0.00% - 0.00% - 0.00% - 0.00% 53,990 0.07%f1";~1,IlJi1qJ'!lj';:!1\1;O", 63,811 0.07%#i"~w.!!li1!~f~J":"!!,,tzf&l!"~ 73,345 0.08% ,~;~~@~Z~rj&t!iSt1~'11~ 83,824 0.08%;:rr'l;,.'~~i~.g7"~\ $I 95,802 0.08%1~;1~1{j~:t1,'j){9t1!1i.'i':'b'I1;..
Payroll Taxes 741,164 1.85% 533,419 1.29% 583,429 1.13% 680,160 1.17% n2,128 1.12% 934,286 1.20% j'tB~~~~?'l;;r:J!1. 1,019,312 1.15% i:jti!I.l~~;g.~~.i'!"::~ lfl 1,098,707 1.13% ':lii~f7\l;a9,4r~!lmi1~!i'f9. 1,175,800 1.12% ffl~i?:\bS4 ~j!~' ill' 1,258,400 1.11% ,~iij:~t~g.~o:)J1i;:~; "
ContmctLabo/ 190,591 0.48% 115,696 0.28% 133,542 0.26% 209,309 0.36% 638,333 0.93% 459,687 0.59% ;:::m;ffi~'!lJij}ljhSilllillil.~ 487,268 0.55% "'0i~117458~J,irit': .Iii; 516,504 0.53% .jjiil1l'l.'t~9';!l\la~lli'~!!ill , 547,495 0.52% ~'wm"'L~Q~ ~,tt 580,344 0.51% :.",1if R~Ql"4~i'<^ i
Adjustment for Inventortes (RWIWIPIFG) 23627 0.06% 127049 0.31% 170260\ -0.14% 195033\ -0.16% (18448\ -0.03% 1124375\ -0.16% ;~,~ftw~2am:!\\~t!. <.. 1131 681\ -0.15% : i;\f~~,~JI~11I 1137,476) -0.14% .m l'\\m5%~li8J!. /142 643\ -0.14% ~il!ii~.z!l1:fi::~~~ "l%' /1484421 -0.13% !ill[1~i~X~!1!J;i I, .. ,
Total labor Costs 11,301,248. 28..19% 7,984,405 19.31% 8,518.,655 16.43% 9.924,622 17.06% 11,550,857 16.95% 13,723,905 17.62% !~~I\~~~!'tAl,';m:j:!JI'l 'hi 15,091,794 17.04% ;i:I~11!~lrl~I"lt,~lWi~r~i';;~~~1~~I'. 16,329,062 16.8.3% L!i!if~i,~I)!]Ij!i!'.(. O:~ 17,556,524 16.76% \i~{~"2'.~~I4(~!~fi~ 18,88.3,787 16.70% ~~il~~~;r~~lr~,.$~)'%7t#!I;~[t'1!~
i"'1@g,.,~=,,,,!,@" I "'''~w,,,,,,,,~,,",j&,."." '* ~'~1~1'&l1r;"'''E',,*1l ",i'jii!W~it\?l''''1&M:~,~.;rlt iiHlwm!i."""j:n;~'!!!GG
1II.=IlSBm'< ~mi1'l%~"",-,,wflE;~~ $. 't~!h mrJ 2;;~W::-: dh'!:li '!.,;(jp ~il!',1 '"*]/iP, ,t '"i:?J d>!;::r-" "'~0~!f: ~~ rt\iilllij1,Rr,~V~] filit;~tlF~f,~ 'i,. T@llipij;i"\~iil\,r,*~~" i;i[@~;JW1f...bd!" . :~';J1~ ~ ~ r:.~..>>=t:0lf@:? ..:;~:i;;:";"
>;S;\'?lM'.li~ 6 ""vae1m<;> '>;$ '~"~'~'7.?::;:>>>'l;""-:OI""~"@?'I^ "'~tj'<.l",,~, ~~%"";~;':-:~:-:1:i!~,J1^ , ~ v"'" ~'" "', :-:, ~ :w ~*11;;m!~':-: W"f"i>:-: ;:::4:J~%~l <<- :<l;,,!si""'~/. ~^"'",>lli&:"l,~:%! l:~>>:;
~ ifiWI v ,w,w, h d!.:~_ '" li01l?',?:-:\~, ""~~ li-;s, !:>!!:i.'i'fb'liH @f:1 rRl:~ ~ il!~~'1b%~ '";i;:-: J::;: ~~~~m.-A ~ >~ffi: ",,~1 mi , ""v :rt!t'l_t~ om ~~ ~ltf.J 1- v ~ >SO . ..l!%>>m'AA!ft~" "li "'~ 4*' m>l' '" ~~*" ~~,,;n; m:.;".
wxx;""'ill~@t~0.i:~~ ';;~~?t~ ~ ;1f~'>i&'1;fif~*~~~'W~^"},,~,;; ,tik!&!i:i}l>kz.1mY.:Mw21l<\\~l" ~r~ llit'2~ltiii"~;j.~~j!;1~r;1S" i% ~~ ~~0/Lt.l~~r~;;~f:{,~~IThtJ0.~K't,
IndirecllaborWages - 0.00% 2,358,298 5.70% 2,511,789 4.65% 3,301,018 5.67% 3,648,722 5.31% 4,091,891 5.25% .~.;"'J:ti~i~ti!!f.lrjf~c rJ 4,500,613 5.08% ~t;;ililf11~~i711f~.; 4,854,028 5.00% ~l~I!I~[$i91111.:r:~. 5,194,572 4.96% ;iii.!~~}8,,(". 5,559,331 4.92% !\W~(~~~!:f>!f:;i~7r .~~
Overtime-Indirect labor - 0.00% 45,117 0.11% 42,257 0.08% 63,631 0.11% 40,813 0.06% 35,456 0.05% ~~~,:;,\'tIti~~~l:f,iJir;;.'ii ,~ 37,583 0.04% 1~~!~~~~;~~}i:l1lf1f?1!J 39,838 0.04'/<l1tl;~~551i1r:*~Qj},0/4 42,229 0.04% l~illl&!~tt~~}:;;1;i,::;,,11J 44,762 0.04% 'm~I8!l'(fl'?J14n<.';~ "
Benefits-Medical - 0.00% 102,919 0.25% 149,244 0.29% 209,969 0.'36% 263,535 0.38% 310,512 0.40% ~j[t;bt~?i~7~!ill"JfiPi1o.\""~~ 364,633 0.41% ~"~~fl!!I!lf~~I,d'i1rl," 419,952 0.43% '~:hQg'~1~L:,11"1 479,958 0.46% ~iiill"~uilll,'fu1'. 548,572 0.49% 'd~iX~pt~~~;:~~,." ~
Benefrts-Olher - 0.00% - 0.00% - 0.00% - 0.00% - 0.00% 18,661 0.02% ~1~@!!.~11;~:B,!Mil1Y~ 21,966 0.02% ,:.;1r\ffi{3;~i'\il"~.""':Il!11 25,351 0.03% f0Hllit~~~jWjm:"r~~ 28,972 0.03% 1;"1ii&hl~~20},!iit';;:.1i[~ 33,112 0.03% ,!m~~7,'r~~~1,':~':&;l~Il!~ '
Payroll Taxes - 0.00% 174,846 0.42% 190,642 0.37% 251,169 0.43% 281,091 0.41% 336.604 0.43% f;ir]~{q5.,~~X~m:if~~Jj 387,053 0.44% d)i:'::~~~ Xp'i"t:t4; I 417,446 0.43% Rlltjr2Qi~g~il.1:~ ~ 448,733 0.43% .jl:."g~iMillr..titJm~?~ ~ 478,102 0.42% :'Nf!;"(a1~691fC:"tt;'if~~
Insurance 76,813 0.19% 119,506 0.29% 146,283 0.28% 209,281 0.36% 309,983 0.45% 413,013 0.53% ~;~ffi~~t~gjl~!i;~il:~ 454,314 0.51% Jl'~~}~lii1;1 ft~:I::"f1~~lfj;.; 499,748 0.52% ;~~;J,)f4~~a;~ii!~~.'" ~ 549,720 0.52% ;M~t%1~,~'t,&~~t"< 604,692 0.53% jirii@1l~~~t;:;J;~lr~
Depreciation 929,567 2.32% 1,116,469 2.70% 1,143,154 2.21% 1,168,896 2.01% 1,'398,018 2.0'3% 1,305,885 1.68% !8i~d:;g2~'!f~a:~i;l\I~1B!lj'f~. 1,266,558 1.43% :ili"::,f3!!~~7!dH~::3J ,.',. 1,326,557 1.37% :,:~~(<ij~9j~l;f'0~'"Jl.~ 1,366,557 1.32% ..ljjl!lJll!6!!{D9!tlN~\:j;.~~' 1,446,557 1.28% iJ~'10;;~~.l~~~111r:~;:tiiiJX~~fJ
Rent 519,353 1.30% 787,542 1.90% 1,195,915 2.31% 1,812,438 3.12% 2,063,666 3.00% 2,141,553 2.75% ;::;f~ '~~~\1i'.;:, ~ 2,205,800 2.49% ,:)l"):,iIl2~74 ' io;i;~;.,,~, 2,271,974 2.34% ;"~\l~9l'!}71U;:L,~,r~\Il!" 2,340,133 2.23% r::':~lllj~~i,!i';tiim 2,410,337 2.13% iitu,mDi,lAQi~04I"'li:~~'1B~
Minor Equipment 43,629 0.11% 17,404 0.04% 11.589 0.02% 50,224 0.09% 41,617 0.06% 44,817 0.06%;t.0;,t3&~'l[~R%?'tl. 46,223 0.05%;;;J:",,!M~~1l)~"~;i AI~ 47,610 0.05'lL,;0"tii!i.8'~;;1;:!~,f1l 49,038 0.05% ;{~:!f;;pji,t~~!!~:;m;~3~",Q 50,509 0.04%0!,jLk:;~1tl4't~:t:~;fu~~~
Repai/s & Maintenance 550,558 1.37% 667,278 1.61% 806,903 1.56% 818,258 1.41~ 781,542 1.14;', 953,353 1.22:", Jil,:;~~[1~1Ih1;~~Jtkl;'!\::" ': : 1,048,438 1.18~ ,,~~~~~il~~?!:J~~11l 1,130,716 1.17;" ;~li~JII~E~~~I!if 1,210,044 1.18;' ~~~~Il~!}}:rt~~,tl 1,295,016 1.15% illi1~i~l~rl {t~,!I~
Supplies 706,307 1.76% 395,859 0.96% 396,941 o.n% 522,372 0.90~ 512,147 0.75~ 654,101 O.72V, ;2[;~51l\l64Y;;~jlP", 618,'337 0.70V. :'m(fl!:ji(~h~m1,~!~~!t,~Jt,f~ 666,108 0.69~ ,~1::t~~(1iI21'Th]'li,~, ", 712,855 0.68~ mimm:'~l~1;.'>5d'~~1 762,954 0.67% ';'I"'J?~,(sri!ta~~I~J"Jl.
Supplies-Press Blankets _ 0.00% 49,846 0.12% 191,664 0.37% 274,021 0.47% 158,382 0.23% 242,632 0.31%~"b.J~~?~~';1~~,p1, 267,679 0.30% ,,'!ffi[f12~JllI:7Xf~'1t1f1;~,1 289,000 o.30%,.,,)~~~~l~0!''\.i*''~' ~ 309,270 0.30% :~!~~~,'t9:;;jjil'iti;.Q;~ 330,970 0.29'/'"""~"!(~;lt~Y;'%~:::~il"
Supplies-PressSolutlons _ 0.00% 36,872 0.09% 76,707 0.15% 93,514 0.16% 108,082 0.15% 130,682 0.17% :;;1JJ!~~jf,\!;9.QJ~~~ 144,172 0.16% 1~';'!'ii!jj~~~~j,*;2:!!f"~ 155,658 0.16% }"~jl~1;rte~f0\mr~~ 166,573 0.16% ;;=lll,911~~i~mi' 178,281 0.16% ""~%'[f(j:tttee~l\~m~~~, W&
Supplles-lnternalProducecl 52,822 0.13% 56,806 0.14% 63,463 0.12% 96,639 0.17% 78,807 0.11% 99,439 0.13%I!H}';1,fi~jl,l$JJ(;,'f.l~tll'i,~.:' 102,422 0.12% ~?~~'Ii!1.~~~~illl'lli;I1~~1 105.495 0.11% :);':&1~\'JI!;..I,;;~:;!~I' -: 108,660 0.10% :;t~;~t~,~~,~r~~'t~ 111,919 0.10% ::J!~~t,f:{$,r"i~!U'!rslr:f~~.,,'"
FacloryEquipmentRenla1 1,418,398 3.54% 1,274,239 3.08% 1,750,206 3.38% 2,059,915 3.54% 2,108,513 3.07% 2,697,963 3.46%I~]1t\~81!J~!i!ll;~t~lif 6, 4,166,789 4.73% 't~~~!i:q~~li;!!~5i~1 '3,981,599 4.10% t,II't1~,9j\'~rr:i'l, ~ 4,000,957 3.82% ,;:[~1,',jl,i~~),I~!~~~L' 4,169,957 3.69% .\'.,{4~~OO~~f~1"1;;," ,
FaclolYUtili1ies 243,976 0.81% 242,055 0.59% 294,509 0.57% 256,671 0.44% 262,508 0.38% 270,383 0.35%1:L'!)~ill~It!!R~,,~':f.;'~" '1,053,142 1.19% :mil~21:Z5~.r:tt;:~1~L, 1,064,736 1.12%;'2"'~~q~).rX~V!~L 1,117,278 1.07%11~'f~~..giP!Jg),i!!~.R~ 1,150,796 1.02%'Jj;,J~~f~.a,~t!~~,,!~'
Mobile Cammunications - 0.00% 5,639 '0.01% 5,070 0.01% 6,220 0.01% 5,908 0.01% 6,085 0.01% Il.i,it,J,&.!i~:7l~0~i!; <~, ,. 6,268 0.01% r\;i!i\l1IIi'1~~~h:mi?!~f, 6,456 0.01% ;J~~l!flli1i111~1, ,;",,;~. 8,649 0.01% ldi' %i~'illj!{194J:t~t:ga' "II 8,849 0.01% !~tg.%::,.;V't~~~;l irJ~." !l'<<
Rubbish & Waste Removal 60,049 0.15% 61,180 0.15% 56,858 0.11% 65,752 0.11% 82,582 0.12% 65,039 0.11%l:t:::f~&!(2!~1l.j:b~W~61 87,590 0.10%1:i1;n!@'~:551\f);J;'~;:pJ~fp% 90,218 0.09% 'wi!~~~!.!&k~~,,, 92,924 0.09% '(Ji1i1<Z:7Q~*':# ' . 95,712 0.08% '~~:;~~i,t~ltfi,(lj;.;l~f :f:r.~
Freight & Postage Charges 2,046,654 5.11% 2,249,048 5.44% 2,943,634 5.68% 2,885,000 4.92% 2,916,932 4.24% 3,395,087 4.36% .i*1~7~{\t5~~~im.~ 3,890,909 4.39%!l;~~;:~~9lll~J,r?~~)1\!1! 4,280,000 4.41%'";'!:!I~.~'i);[i;j "'. 4,627,757 4.42% }W,1!I!li~!r~f,';)l$"'" 5.046,105 4.48%~~!,\!'[{4~~~~~V~\:iWii~"I
Employee Reauiting 57273 0.14% 805 0.00% - 0.00% - 0.00% - 0.00% - 0.00% ~y,;;..)iI~!Jf[j\\),~""m~.ililiP.!'l ~ - 0.00%" '}ii:trillf)1Wifi!,,]jj!II"'/QIll - 0.00% %!f[;illiit;J;;&:?]~.&4 "JOB - 0.00% ';1 '0t;Wi'!!ii.i~!'~':,W >' - o.oOo/cH;I;[(I);>i!"'.'~~~~t[tr'l:W~~
Emplayee EducatiorVTraining 1:444 0.00% 13,183 0.03% 668 0.00% 5,956 0.01% 3,943 0.01% 4,061 0.01% ;,fu~ils'~'t1i1~~~1l " ~ 4,183 0.00% :1f'~1@~;1rli ~ '": *' 4,308 0.00% ill ';]!Mf\i!2~ljW:Th~,":' 4,43a 0.00% ~.~u4~~t.;~~~~~ ~ 4,571 0.00% [,<,~~;';r~fu33j:J!1,~~~
~~ ,.... ......,,, '-'" '""" "-"" .."" '.m OM' .", .."" ,-"" 0"'" l!-"'~ ""~'" , '.'" .m" ~_I '.'" .."" ;.'''''''"'''11<1''' "'" .."''' .....I'll!;. '<If .. '.,", '.""', -'l,_, -',,~
Dues & Publications 1,782 0.00% 236 0.00% 1,796 0.00% 1,894 0.00% 1,148 0.00% 1,182 0.00% :~I~l~~~l~}~~""JI' 1.217 0.00%101';j?~~.J';!.a,~{~;;;;;~~,flti! ~ 1.254 0.00% ~ :t'Jiill;~'{~~l;~~ ::_~ 1,292 0.00% '0tii~~I~)~~~~lil'_: 1,330 0.00% ::~Jt'>~'fjjlB;'::~~.)~ .,
Auto &TlUck Expenses 53,956 0.1'3% 56,711 0.14% 61,659 0.12% 76,183 0.13% 75,303 0.11% n,582 0.10%.:J1i!:'~'!t~~Jit~1Jl)::t~;"' 79,889 0.09% f"tZ,,:;'~~.2,fK1ii']", . ' 82,266 0.08% ;;",.m,{~'3~7lf(;i:~. 84,754 0.08% :<mWwt!!,I~~~l!.1r~[~ 87,297 0.08% ';;;firf'" kj!_:),~:~:~r ;,.
AdjustmenlforWIP-FacloryOvemead (274,842) -0.69% (130,136) -0.31% (123,021) -0.24% (189,202) -0.29% /57,n8\1 0.08% .(90,531) -0.12% ",\lj~t~Zji'<1 ' ..(93,247) -O.11%i[4jm:;:;j:~t011;;:;;:i~"" (96,044) -0.10% ~;'';~~i't9t",.~,f;~ ~ .(98,92~1 -0.09% .irrf:~i~!~~I~"0:~~.J (101,893) -O.09J.~{~~~L:~;~I~l~i!1~~
Internal Job Cost Recovery _ 0.00% (120440\ -0.29% 1161,054\ -0.31% 1195,026i -0.34% 175,098 -0.25% 1210,085) -0.27% <M."'3498Z~,,!""1g; /216388\ -0.24% 2im!mffi'6,~a(IT'.;" ~ ~ /222880\ -0.23% "fl(ilt"llifu6i4ll2s'^, ;~_ /229566\ -0.22% """ i,'h5i6e6J'Y1'ii:t~ 1236,4531 -O.21.1~~mK~;:5.aJ:1ill~Th~1~~~~%,
Total Factory Overhead 6,493,751 16.20% 9,589,656 23.20% 11,767,359 22.70% 13,848,364 23.80% 15,030,526 21.8.7% 16,932,299 21.74% (;1~~,,~~i~9ill,u~lt~~&~~1:;;':*f~~i,$Ii, 20,475,267 23.12% ;~f~;;~~l~~l.tt";r!J.f'~~.. 21,468.,725 22.13% ,:i:W~(llJ!,~~91:;'f.~_ 22,640,401 21.61% '1!1~'i!3J1~~~~L:1\i1~1'lt 24,08.7,129 21.30%IG::J~,~,6.7~Jl'l["11'~~~
1mm(~:-:::"~~W11~E;.>;; ...*"j/~ ~y . :jmj~m11m;rmnti[f," 'i2:tiillL~ ~~"81t~~~:>''''' i-l;(;~'" ~ ~~,_ -""lli~~~jill~""m~;!H k?)111if~~ """&1",, '" "d' "Ji~.
Total Cost of Goods Sold 30021593 74.90% 2978.28.39 72.04% 36013382 69.47% 43 529 701 74,8.2% 51663012 75.17% 67662079 74.04% \jiG[ijp$;tf6~ fit ~~dlf%! 66246 686 74.8.0% ,~'~!ge:t6il7 :,f~:t.' 71303001 73.49% 2.4g~~S~1~m~~k.~ 76284,446 72,83'/, ;: '~J;;1711i~\,F~_ 81846 407 n37%1;~:~'1~6~i~~;t~~;;;::4i9~
Gross Margin 10,061,536 25.10% 11,558.,420 27.96% 15,826,311 30.53% 14,647,951 25.18.% 17,064,703 24.83% 20,221,117 25.9G% 'JiW;!'~~~~tmSil~~l~i~lli1;ri;4]:;;I!i~I:t:"t1111" 22,321,555 25.20%.' ,~~~.i'lf,..~PI\O,!li"W[~~"~',:1:!~?j~l)Jj';; 25,727,411 26.51% ,,,~~'1 '~~~!m~ill~,~~91~jm~j:1~1lIf!gBt 28,463,971 27.17% '!\2i73~;~60' ,{;,1, ". 31,246,8.16 27.63%"''''m2.18.2,~5".>,';;;l;.7a~:I'
"i:1'.ili;~'/i<i,t,,, ~'1~,t~ ,,,- ''If Sit ~J*ir>"~"'''''X'''''''''l"~~illI. 'II x>>: y~'" -~~""'>: ll>1l:~:~"~~g:~ '~:0\"'~ >.~" ((Thi::'i x"J.;.r:""'~IW. ~l{;!m~~IT ~*,"'~Fk~ n<",,(~l'1
~>j{:d.:i<'l x>"',,;:~F;;,>~,lil~'~ ;%1.'" "r,' ,~~ ~ x" ",,;,. ;f:P lmi., ~",y,,' ",,)2 ~ :;;:;;,,,"'1ilm-~>>.! l:if:~:<~11 ,;ill~l}.J,n~l' \~rff1:;:;'i<<l\i" ">.~ ~'0.<"~ ~ 'm ~y;)i' ""li~~ffili!
r,::~;t.fW< ;f,>' : ,;.k,.;;rt,,{:: 8 ill2Mt F~ ~~:; ,1tr~ /:"1f:~ ,~~ ~ ~ :p~SWr~;0~rn~ :llilli1~\~~~~;rff1~1i ~ / t'milC4\li~,~~ Jt~1~ ~;N ~ "n l! :f.~:~~ ~"",; ~i~lJ.; t '??~;.~rr~~!~
'''~W:~'1Wii0@W'iiji!iibi:-:,*1i;;1'~'':;'''l;1! ''':t.:>~~\HU~fE'' ".<<!mmili~;<."~~~ :>"" ',,~, ;",'1 .;,<~~~~Hi.i;,;,t.j", X:i j l" ,,~' ,.<~w..~if[#,;m~ ~); x!n?,t ~0''',,'"'~''t ",>.~!i:;j;S::./g
,,>,"'l>'~':;;;;; ~:~;;1ij'~~:llil:f1!;~mjn:~.,y :V;,,' '>,,:i ,:.>:x "~II"u,,~ r; "'," '0."~;;Y~ w.; 1.:~ .,~ x "" ,,->: lllm~ ~ ""~""- R, w >:y!<<<' ",~L:f-'i':.x"
I Selling, General & Administrative ',". "~.' . ," .,-, " " ","" ^ ,TIIW~'Mi""" ",., ~fIl-,"j . " '"' ~ ,<, ,".' ' , ' 'i:1ie - ",j],,"1 ' , , , " "' = ,", ".i~k
Salartes (From Personnel Schedule) 5,417,153 13.66% 5,511,345 13.33% 6,794,339 13.11% 7,940,193 13.65% 8,388,093 12.21% 9,282,918 11.89% "i;~~~Z4.~i~i~i~ial. 10,666,434 12.04o/cl'I~;1 'l{l~l~I~I~~j~i:;\isJf~ 11,884,354 12.25%; j;ij~~fmi~~)~;~i!t~l~1 13,063,480 12.47%!II^"~f'i~:i~~;':";Mlll 14,343,922 12.68% ~]f,~,!IJ l;:?~~ll
Bonus Provision 258,959 0.85% 275,175 0.67% 952,449 1.84% (82,028) -0.14% 487,945 0.71% 1,121.549 1.44% ; <)A$3a;ep!:!t":,...,1~9~W~ 1,321,703 1.49% V:. (20l);1~(. ,!t1,"Ji 1,445,990 1.49% ' ;' .~1~1t(:2'k/li1:;i:i,!!~~~~ 1,558,744 1.49%. '~~~2i7~)': ;'iBi7&!!tlr~ 1,680,489 1.49% . );~mt1.21i!!~IJ ,q.'M~f~
401k Malch Provision - 0.00% - 0.00% 95,829 0.18% 122,291 0.21% 133,780 0.19% 134,439 0.17% ".'r1::'}{[(6,59],." [jl;'~~ 166,583 0.19% ' "'J~,1:llli) , ;.;~~,~~. 181,949 0.19% ". '~{1:B'';366)< ,':,-, 196,849 0.19%" ;M!1!1;9jjOH;'ifJl:t'lll';~ 212;918 0.19%Ul.j] '~;;I'<~l {i1~'~['2~' -';,:>!l1\:~~
Payroll Taxes 415,661 1.04% 342,336 0.83% 419,595 0.81% 449,605 0.17% 504,057 0.73% 574,710 0.74%.;;;',,:Wil!~3l';';~~~, W<', 674,612 0.76% f: ,;~9~,9Qe}<'m]~~i 751,396 0.77% ;'~'(f,;$i1t~I;:!k':::~l];~, 826,194 0.79%" :\!Z;~~'t9~t;\1:t~+l'lJ 907,446 0.80%, '(~1;2li21,,';:~~giif.~i
Benefits-Medical 229,595 0.57% 185,508 0.40% 192,086 0.37% 297,998 0.51% 335,553 0.49% 381,966 0.49% d:~I;re:i413t::,"1~lii 448,279 0.51% ,.:'[ (~,3il~l ,';,1~~~} 516,182 0.53% i. '-'~~~1k f,:1~~ 589,941 0.58% ",,"~'~~H ,jStt~~ 674,284 0.60% ;;,iI~,igli~l,t: ,.f!,4'~~
Benefits-Other - 0.00% - 0.00% - 0.00% - 0.00% - 0.00% 19,945 0.03% ;:l!im(l~:~l,V':"; iOtl{l!%. 23,499 0.03';'11~;~<IIi~'!'~'l'il.~ 13J554j .<.tMI'~i?t!! 27,095 0.03% ,~~ ;;S@'i~96) 11lii. 30,966 0.03%, .,,';~2ig~~lqJ,~!!'~~ 35,391 0.03% "".: ;;I4;'1?5f )!~1li2~
Marketing & Promotions 114,481 0.29% 118,230 0.29% 257,821 0.50% 146,318 0.25% 187,572 0.27% 193,197 0.25%"ii;i!i'~i'I5;e:;!.5)'ii~m:m~~,~ 198,993 0.22% '".:, {~rt~l ,. /!$1,b9''*'' 204,963 0.21% ':,,'li~~:qi~7Qr:/~r:a:~ 211,112 0.20% .~' :,lqi~49}: ,i~~~ 217,445 0.19%E;:::iliu;;j'[:(?,3il$1 'j, ijl~~~
Advertising 23,132 0.06% 536 0.00% 4,418 0.01% 30,655 0.05% 8,264 0.01% 8,512 0.01%rili:pJj;:'i:':;~(@~lill~[fj;~m'" 8,767 0.01%".~;.. L::!255L.' ~,;~,JiS\~ 9,030 0.01% '"';,'ii!,\jti?&~I.~:,J.~~ 9,301 0.010/0[::::1ill:Hm::uL:~Zi1.L';c2iJ!jl~ 9,580 O.Ol%I';!J:.\i:j!i!m!::~@Z~}",' _"~"f!Q,'!9;
FORECAST CONS P
CONSOUDATED '~'I"" ..
_ c,9.)@.~,~"",.v. ;;:::
Employee Rect\Jiting 130,643 0.33% 91,261 0.22% 94,950 0.18% 0.14% 0.15% 0.13% 0.13% 0.12% ,.'" 0.11%
Auto Expenses 26,446 0.07% 63,338 0.15% 92,003 0.18% 0.15% 0.17% . 0.15% 0.14% 0.14% ~~ 0.13%
Bad Debts Expense 38,276 0.10% 107,926 0.26% 251,710 0.49% 0.73% 0.40% 0.36% .:1 0.34% 0.33% 0.31%
Donations & Charitable Giving 13,554 0.03% 22,360 0.05% 22,114 0.04% 0.05% 0.05% 0.04% 0.04% 0.04% 0.04%
Dues & Publications 17,476 0.04% 18,994 0.05% 27,792 0.05% 0.03% 0.03% 0.03% 0.02% 0.02% 0.02%
Conventions & Meetings 3,284 0.01% 16,356 0.04% 11,016 0.02% - - 0.00% - 0.00% p. - 0.00%". - 0.00% - 0.00% 0.00%
Business Tmvel 164,352 0.41% 177.973 0.43% 205,949 0.40% 247,544 177,299 0.26% 206,311 0.26% 212,500 0.24% 218,875 0.23% 225,442 0.22% 232,205 0.21%
Entertainment Expense 49,183 0.12% 92,164 0.22% 87,159 0.17% 88,542 23,209 0.03% 44,134 0.06% 45,458 0.05% 46,822 0.05% 48,226 0.05% 49,673 0.04%
Outside Cammissions Paid 44,018 0.11% 18.740 0.05% 4,179 0.01% 2,735 32,496 0.05% 33,471 0.04% 34,475 0.04% 35,509 0.04% 36,575 0.03% 37,672 0.03%
Outside Commissions-E-commerce - 0.00% 4,008 0.01% 28,887 0.06% 14,297 9,078 0.01% 9.350 0.01% 9,631 0.01% 9,919 0.01% 10,217 0.01% 10.524 0.01%
Professional Fees-Audit - 0.00% 38,972 0.09% 88,314 0.17% 85,015 61,641 0.09% 63.490 0.08% 65,395 0.07% 67,357 0.07% 69,377 0.07% 71,459 0.06%
Professional Fees-legal 0.00% 79,089 0.19% 78,185 0.15% 110,540 67,189 0.10% 69,275 0.09% m 71,353 0.08% 73,494 0.08% 75,699 0.07% 77,970 0.07%
Employee Education - 0.00% 21,322 0.05% 5,563 0.01% 6,247 1,854 0.00% 6,030 0.01% 6,211 0.01% ,; 6.397 0.01% 6,589 0.01% 6.787 0.01%
Other Professional Fees 418,827 1.04% 146,201 0.35% 62,145 0.12% 89,802 110,262 0.16% 93,999 0.12% 96,819 0.11% 99,724 0.10% 102,715 0.10% 105.797 0.09%
Vending lncome(Expense) 31,370 0.08% 35,763 0.09% 39,855 0.08% 42,787 50,641 0.07% 52,160 0.07% 53,725 0.06% 55,337 0.08%,i1i:' . 56,997 0.05% 58.707 0.05%
Employee Recognition 186,213 0.46% 118,529 0.29% 254,814 0.49% 233,330 198.570 0.29% 245,729 0.32% 253,101 0.29% 260,694 0.27%.,1. 268,515 0.26% 276,570 0.24%
Office SupplleslMinor Equipment 141,789 0.35% 73,212 0.18% 108,979 0.21% 94,441 113,794 0.17% 112,718 0.14% . 116,100 0.13% 119,583 0.12% . %. 123,170 0.12% 126,865 0.11%
Software Maintenance&Support 0.00% 597 0.00% 1,512 0.00% 6,477 7.793 0.01% 9,881 0.01% 10,177 0.01% 10,483 0.01% 10,797 0.01% 11,121 0.01%
Office Equipment Rental 43,403 0.11% 43,249 0.10% 52,969 0.10% 46,995 55,155 0.08% 62,921 0.08% 64,809 0.07% 66,753 0.07% 68,755 0.07% 70,818 0.06%
Repairs & Maintenance 14,904 0.04% 32,218 0.06% 43,482 0.08% 49,087 58,524 0.09% 46.030 0.06% 47,411 0.05% 48,833 0.05% 50,298 0.05% 51,807 0.05%
Internally Produced Supplies 207,675 0.52% 110,987 0.27% 152,786 0.29% 160,117 156,647 0.23% 1n,972 0.2:W. 183,311 0.21% 188,810 0.19% 194,475 0.19% 200,309 0.18%
NuQuest Management Fee 479,373 1.20% 451,800 1.09% 313.080 0.60% (0) 0.00% 0.00% - 0.00% 0.00% - 0.00% 0.00%
Telephone 145,795 0.36% 144,726 0.35% 131,303 0.25% 146,950 142,124 0.21% 151,540 0.19% 156,086 0.18% .. 160,769 0.17% 165,592 0.16% 170,560 0.15%
Depreciation 237.233 0.59% 285,625 0.69% 169,675 0.33% 142,864 119,332 0.17% 119,040 0.15% 122,612 0.14% 126,290 0.13% 130,079 0.12% 133,981 0.12%
Insurance 26,572 0.07% 44,976 0.11% 46,813 0.09% 66,091 64,794 0.12% 97,638 0.13% 107,402 0.12% 118,142 0.12% 129,956 0.12% . 142,952 0.13%
Officer Life Insurance 21,220 0.05% 21,441 0.05% 23,972 0.05% 17,552 2,296 0.00% 2,365 0.00% 2,436 0.00% .. 2.509 0.00% . 2,584 0.00% 2,662 0.00%
Office Rent 133,536 0.33% - 0.00% 517 0.00% - - 0.00% - 0.00% 0.00% 0.00% - . 0.00% 0.00%
Bank Service Fees 59,559 0.15% 29,732 0.07% 62,192 0.12% 25,032 43,205 0.06% 45,621 0.06% 46,990 0.05% 48,399 0.05% 49,851 0.05% 51,347 0.05%
Early Payment Discounts (9,364) -0.02% (5,174) -0.01% (5,931) -0.01% (3,664) (10,810) -0.02% (11,134) -0.01% '. (11,468) -0.01% : (11,812) -0.01% . (12,168) -0.01% (12,531) -0.01%
Misc 2,586 0.01% 27,947 0.07% (447) 0.00% (20,541) 2,685 0.00% 177 0.00% 182 0.00% 188 0.00% 193 0.00% 199 0.00%
Sales Tax Paid 0.00% 2,646 0.01% 0.00% - 0.00% - 0.00% '" : ~ 0.00% 0.00% '. - 0.00% 0.00%
Total S, G & A Expenses 9,147,103 22,82% 8,730,108 21.12% 11,172,054 21,55% 11,087,555 12,306,831 17.91% 13,952,645 17.91% 11 ..~tI 15,838,779 17.88% 17,428,283 17.96% 18,974,401 18.11% 20,653,020 18.26%
~~Ef~1lD~I~~.,'::r..m~i~_f~mI#"'fi' ~~"., ~~!f~' ~m_,DR.~- - .]t_~:R:@?t. ..";"i;_~
.', .',-,' ---$' : '.~,,' ~';,. :~ ~ ., ~ " t
Non-Q ratin9 Income Ex enses
Gain (Loss) on FIXed Assets 195,782 0.49% 166,084 49,977 -0.06% (180,907) -0.26% -
Recoveries on Bad Debts . - 673 . . . . -
Net Gustafson Building Income (Expens - (143,122) -
Interest Income 1,418 6,350 - -
Other Income (Aexo Mgt Fees) 213,821 - - - -
Earnings of Subsidiary (218,326) (226,650) (243,119) (344,023) (400,080) (452,751)
Finance Charges Income (19,379) 10,106 12,800 14,517 15,487 . 16,542
Interest Expense (375,895) (289,810) (382,598) (448,462) (486,200) (527,577)
Other Expense - (5,290,878) (1.188,000) (1,156,000) (1,124,000)
Penalties & Fines .
Current Income Tax
Non-OperaUng Income (Expense)
(4,685,326) (4,868,100) (5,111,505) (5,367,080) (5,635,434) (5,917,206)
(10,854)
(164,080)
(155,621)
(471,213) (4,506,047) (5,015,881) (4,868,100) (5,111,505) (5,367,080) (5,635,434) (5,917,206)
Outside Prlnting-From NuQuest (4,448,254) (4,698,770) (4,868,100) (5,111,505) (5,367,080) (5,835,434) (5,917,206)
Outside Prlnting-other (204,055)
adjust for WIP-materlals (133,527)
Supplies-Internal Produced (MOH) (9,186) (22,397) (17,735) 0 0 0 0 0
1relght & postage (150,20B)
Supplies-Internal Produced (SGA) 50 (51) (15,403) (35,399) (15,642) 0 0 0 0 0
FORECAST CONS P
ROBERTJ.LOTHENBACH
PERSONAL FINANCIAL STATEMENT
As of: April 30, 2004 Page 1 of 2
Liquid Assets:
Cash 25,000
Cash - Building Account 131,600
Total Liquid Assets $ 156,600
Investment Assets:
Stocks & Mutuals - Investacorp 247,109
Private Placement 300,000
Private Placement - Nancy 200,000
Total Investment Assets $ 747,109
Retirement Assets:
Challenge Printing Inc. 401 k Plan 414,871
Total Retirement Assets $ 414,871
Financial Assets:
Challenge Printing, Inc. . 100% owned 55,800,000
Lothenbach Stables, Inc. 100% owned 2,000,000
Imagine Stables, Inc. 50% owned 5,000
Total Financial Assets $ 57,805,000
Real Estate Assets:
18313 Nicklaus Way
Eden Prairie, MN - Residence 2,900,000
7500 Golden Triangle Drive
Eden Prairie, MN - Commercial Property 4,200,000
7490 Golden Triangle Drive
Eden Prairie, MN - Commercial Property 3,500,000
Total Real Estate Assets $ 10,600,000
Personal Use Assets:
Personal Property 700,000
Total Personal Assets $ 700,000
TOTAL ASSETS $ 70,423,581
,
ROBERTJ.LOTHENBACH
PERSONAL FINANCIAL STATEMENT
As of: April 30, 2004 Page 2 of 2
LIABILITIES:
Mortgages Payable on Real Estate:
18313 Nicklaus Way
Eden Prairie, MN
Payable to Bank of America 1st 1,920,000
7500 Golden Triangle Drive
Eden Prairie, MN:
Payable to USBank 1,723,317
Payable to SBA 625,733
Ind. Dev. Rev. Bond Payable 1,030,000
3,379,049
7490 Golden Triangle Drive
Eden Prairie, MN:
Payable to American Family 2,528,341
Total Real Estate Mortgages $ 7,827,390
Deferred Income Taxes 3,000,000
TOTAL LIABILITIES $ 10,827,390
NET WORTH $ 59,596,191
Contingent Liabilities:
Guarantees of Notes Payable for
Challenge Printing, Inc. $3,400,000
Guarantees of Operating Leases
for Challenge Printing, Inc. $12,500,000
Guarantees of Operating Leases
for Flexographic Specialties 800,000
BUSINESS DEBT SCHEDULE (not applicable if included in audited financial statement)
Company Name Challenqe Printinq, Inc. Date As of 6/30/04
This schedule should include loans for contracts/notes payable and lines of credit, leases (not accounts payable or accrued liabilities).
CREDITOR ORIGINAL ORIGINAL TERM or PRESENT INTEREST MONTHL Y COLLATERAL LOAN
NamelAddress DATE AMOUNT MATURITY BALANCE RATE PAYMENT or SECURITY PURPOSE*
Aeel. No.USS 6/29/01 $9,000,000 10/31/04 $3,700,000 Var., 1 mo. NIA Assets of Operating
Line of Credit Annual Rene Libor + 2% Business Capital
#3378360060
/3999
Aeel. No. USS 7/30/02 750,000 3 years $249,984 5.45% $20,834 + Equipment Equipment
NIP
#3378360060 interest Purchase
Aeel. No. City of 5/2/96 $1,340,000 15 yrs, $630,000 Variable $90,000 Letter of Credit Building
EP, IRS NIP
#279538e12 5/31/11 annual pmt purchase
.
Aeel. NO.Wells 12/28/01 $200,430 5 yrs $108,873 6.95% $3,964 Equipment Equipment
Fargo NIP
#1410982880 #001- Purchase
0043067-
700
Aeel. No. USS 7/30/02 $300,000 4 yrs $150,000 5.98% $6,250 = Equipment Equipment
NIP
#3378363999 interest Purchase
Aeel. No. Wells 5/30/02 $312,430 5yrs $194,903 6.75% $6,150 Equipment Equipment
Fargo NIP #001- Purchase
#1410982880 0043067-701
AeeL No. Key 9/24/03 $204,370 7 yrs $184,691 4.23% $2,806 Lease Equipment
Corp Leasing
#9456690002 #880002283 Purchase
5
TOTAL PRESENT BALANCE $5,218,451
(Total must agree with balance shown on Interim Balance Sheet)
*Line of credit, equipment purchase, etc.
8-20
w-u- II
Full Name: Robert J. Lothenbach
Title: President and Chief Executive Officer
Biography
President and sole owner of Challenge Printing, Inc. since 1988, Bob
has built one of the more amazing success stories in the printing
industry in the last 15 years. Starting in a space no bigger than a
garage stall, Challenge Printing will close 2002 with sales in excess
of $62MM. Lothenbach operated a press while in high school and
started selling print soon after. He co-owned Crosstown Printers, a
local commercial sheetfed company, for seven years prior to starting
Challenge.
Bob was voted Minnesota's Entrepreneur of the Year in 1993 and his
companies have been heralded in the Twin Cities printing industry as
pace setters for customer service, on-time deliveries and embracing
of new technologies.
Full Name: Joseph E. Hanneman,CP A
Title: Chief Financial Officer
Date of Birth: 5-29-60
Experience:
Challenge Printing. Inc.. Eden Prairie MN
1999 - Present
. Chief Financial Officer
. Responsibilities include all financial aspects as well as IT
Detector Electronics Corp. -$100M Manufacturer
1990 - 1999
. Chief Financial Officer
. Financial and IT, some operations
. Acquisitions and Divestitures
John H. Crowther-Insurance Brokerage
1985 - 1990
. Regional Controller
Deloitte & Touche
1982 - 1985
. Senior Auditor
. Auditor
Started career with the big four (formerly 8) Public Accounting
Firms
CPA (Certified Public Accountant) 1982
Education:
University of Iowa
With honors
BBA in Accounting
Member of PIFE (Printing Industry Financial Executives)
Full Name: James J. Gustafson
Title: General ManagerNP of Operations
Experience:
Challenge Printing. Inc.. Eden Prairie MN
2002 - Present
. General ManagerNP of Operations
Challenge Printing. Inc.. Eden Prairie MN
1998 - 2002
. Production Manager
Banta Direct Marketing. Chanhassen MN
. Offset Manager (1/1997 -1/998)
. Prep Manager (8/1995 -1/1997)
. Scheduling Manager (1/1995 - 8/1995)
. Customer Service Representative (4/1994 - 1/1995)
Litho Specialties Inc.
1/1993 - 4/1994
. Pre-press Assistant
Color Express. Inc.
9/1991 - 6/1993
. Management Trainee
Education:
81. Thomas.University. 81. Paul MN
Bachelor of Arts - Business Finance
Full Name: Christopher D. Bixler
Title: National Sales Manager
Date of Birth: 6-4-68
Experience:
Challenge Printing. Inc.. Eden Prairie MN
June 2002- Present
. National Sales Manager
Holden Graphic Services - Minneapolis MN
August 2000 - June 2002
. Senior Sales Manager
. Regional Sales Manager
Wallace Corporation - Lisle . IL
Jan - 1991 - July 2000
. Manager Sales & Customer Service - Hillside Printing Div.
. District Sales Manager - Direct Sales Force
. Sales Representative - Commercial Print Division
Education:
Western Illinois University
Major in Communications - BA
Minor in Marketing and Psychology
Full Name: Chris J. Lehan
Title: Director Print Services
Date of Birth: 2-26-63
Experience:
Challenge Printing. Inc.. Eden Prairie MN
June 2003 - Present
. Director Print Services
UV Color. Roseville MN
7/2001 - 6/2003
. Prepress Manager
The Bureau. Minneapolis MN
10/2000 - 7/2001
. Prepress Manager
Gannett Offset. Maple Grove MN
10/1997 - 9/2000
. Prepress Manager
Reynolds Printing. Eden Prairie MN
6/1995 - 10/1997
. PrepressManager
Clarinda Color. S1. Paul MN
8/1994 - 5/1995
. Systems Manager
Education:
University of Wisconsin. River Falls
Bachelor of Science in Graphic Arts, Minor in Sociology
Summa Cum Laude
Academic and Athletic All-American
NOTICE OF FIRST SOURCE AGREEMENT
* Complete when State Funds are in excess of $200,000
Per Minnesota Statutes 268.66, a business or private enterprise receiving loans from the State of Minnesota
in a mounts over $200,000 must enter into a First Source Agreement with the Minnesota Department of
Employment and Economic Development (DEED) to use the WorkForce Centers as its first source for
recruiting, referring and placing of employees. It is the State=s desire to assure employment opportunities
for unemployed and economically disadvantaged residents of the state that arise from these programs.
The steps that will be followed to complete the First Source requirements have been simplified to assure a
minimum amount of paperwork for the employer.
1. At the time of award by the Business Finance Unit, the Loan Officer will provide written notification to
the WorkForce Services Division of the DEED (St. Paul) by providing the name and address of the
business as well as the contact person and phone number along with the number of jobs to be
created as a result of the project.
2. The Workforce Services Division will contact the appropriate WorkForce Center nearest to the
business location and send a copy of the First Source Agreement to the local Center along with the
information provided by the Business Finance Unit.
3. The Work Force Center representative will contact the business to schedule a meeting with the
business contact to negotiate and sign the First Source Agreement. Note: the employer must only
list job openings in the State and only for those job classifications that are specified in the DEED
project. Managerial positions or job openings to be filled by internal promotion need not be listed.
4. The business will then notify the WorkForce Center of job openings ten days prior to the anticipated
hiring date. Job descriptions will be entered into the Job Bank computer for screening and referral of
qualified job applicants. Within five days, the WorkForce Center will notify the business of the
number of applicants referred.
5. The applicants will contact the business to arrange an interview. The business will make all
decisions on whom they will hire.
The First Source Agreement is designed to help businesses find new employees by providing a free and
simple method of recruiting and hiring qualified candidates. If you have questions please contact Jim
Henderson with the MN Department of Employment and Economic Development located at 390 North
Robert Street, St. Paul, Minnesota 55101. His telephone number is (651) 296-3443.
--------------------------------------------------------~---------------------------------------------------.--.
I HAVE READ THE ABOVE INFORMATION AND I WILL SIGN A FIRST SOURCE AGREEMENT AS A
CONDITION TO RECEIVING A LOAN IN EXCESS OF $200,000 FROM THE MN DEPARTMENT OF
EMPLOYMENT AND ECONOMIC DEVELOPMENT.
Signature and Title of Business Contact Date
Phone Number
8-21
NOTICE TO COMPANY
The data you supply in this application to the Minnesota Department of Employment and Economic
Development will be used to assess your company=s qualifications for a business loan. We will not be able
to process the application without this information. If an award is provided for the project, the information
contained in the application will become a matter of public record with the exception of those items protected
under the Minnesota Government Data Practices Act found in Minnesota Statutes 1997, Chapte(13.
----------------------------------------
I have read the above statement and I agree to supply the information requested to the Minnesota
Department of Employment and Economic Development, Division of Business and Community Development
with full knowledge of the information provided herein. 'certify the information contained herein is true and
accurate.
Signature of Company Official Position
Date
8-22