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NOTE 5 - LINE OF CREDIT:

The preparation of financial statements in conformity with generally accepted accounting principles, requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported revenues and expenses during the respective reporting periods. Actual results could differ from those estimates.

NOTE 6 - CONTINGENCIES AND COMMITMENTS:

The preparation of financial statements in conformity with generally accepted accounting principles, requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported revenues and expenses during the respective reporting periods. Actual results could differ from those estimates.

The Company leases certain transportation equipment under operating leases expiring in 1999. The terms of the lease provide for annual renewal options and contingent rental payments based upon mileage and adjustments of rental payments based on the Consumer Price Index. Minimum rental payments were $316,000, $255,000 and $263,000 in fiscal years 1998, 1997 and 1996, respectively. Contingent payments were $105,000 in 1998, $98,000 in 1997 and $95,000 in 1996. Future minimum lease payments are approximately $130,000 in 1999. The Company also leases certain other properties which do not result in material commitments.

NOTE 7 – SUBSEQUENT EVENTS:

In November 1998, the Board of Directors declared a 10% stock dividend. Net income and cash dividends per share are calculated based on the weighted average number of shares after giving retroactive effect to the stock dividend. The weighted average shares used for computing basic earnings per share in the accompanying statements of income were 11,369,812 for all periods presented.

In November 1998 the Company sold land and recognized a pre-tax gain of approximately $610,000.

Subject to approval by the Company’s shareholders, the Board of Directors adopted the 1999 Stock Incentive Plan (the “1999 Plan”) on January 11, 1999.