Bus Shelters and Lincoln Road Directories AgreementsBUDGET AND PERFORMANCE IMPROVEMENT
Internal Audit Division INTERNAL AUDIT REPORT
TO:
VIA:
FROM:
DATE:
Jorge M. Gonzalez, City Manager a
Kathie G. Brooks, Budget and ~erf.o mance Improvement Director .p
James J. Sutter, Internal Audit<::. "1:j~
May 28, 2010
AUDIT:
PERIOD:
Bus Shelters and Lincoln Road Directories Agreements
October 1, 2005 through December 31, 2008
This report is the result of an audit performed on advertising revenues receipts from two agreements
with Clear Channel Adshel for citywide bus shelters and Lincoln Road area directory structures, in
accordance with our audit plan.
INTRODUCTION
On April18, 2001, the Mayor and City Commission authorized the execution of an agreement with
Clear Channel Adshel ("Contractor") pursuant to Request for Proposals (RFP) Number 112-99/00 to
construct, operate and maintain directory structures in the Lincoln Road area. The executed
agreement was for an initial term of five years with the option to renew automatically, at the end of
the initial term for five one-year terms. After approval of Resolution 2002-25064 by the Mayor and
the City Commission, the terms of the initial agreement were amended on November 13, 2002, to
add 10 additional street name signs and one directory structure, as well as to extend the initial term
for two years. The contractor agreed to pay the City on a quarterly basis a minimum annual
guarantee on an escalating scale.
A similar agreement with this Contractor was executed on October 17, 2001, to construct, operate
and maintain bus shelter structures and other street furniture throughout the City, pursuant to a
separately issued RFP number 107-99/00. This agreement was for an initial term of ten years
commencing on November 1, 2001, with the option to automatically renew for a five year term. The
Contractor agreed to pay the City on a quarterly basis a minimum annual guarantee plus a
percentage of revenue sharing, both on an escalating scale.
Revenue payments received by the City for the audit period are as follows:
FY 05-06 FY 06-07 FY 07-08 FY 08-09 (1) Grand Total
Bus Shelters $340,500.02 $415,146.15 $404,702.78 $119,330.50 $1,279,679.45
Lincoln Road $115,014.41 $146,417.21 $144,192.48 $ 27,256.16 $ 432,880.26
$455,514.43 $561,563.36 $548,895.26 $146,586.66 $1,712,559.71
(1) Amounts represent revenue receipts for only three months (October 2008-December 2008)
OVERALL OPINION
As a result of our testing during the audit, we were able to confirm that the Contractor is making
revenue payments to the City for bus shelters and Lincoln Road area, based on the net revenues
received from advertising contracts identified on their quarterly reports; is providing maintenance to
street furniture and Lincoln Road directories; and complying with other terms of the agreements.
However, results from our testing identified deficiencies in reference to the City's review of the
We are commitled Ia providing excellent public se1vice one/ sofety to oil who live, work, ond ploy in our vibronl, lropicol, historic community.
Internal Audit Report
Bus Shelters and Lincoln Road Directories Agreements
May 28, 2010
accuracy and timeliness of quarterly revenue receipts; inspection and maintenance of bus shelters;
and processing of revenue receipts by the Finance Department. Areas identified for corrective
action include the following:
1. Revenue payments made by the Contractor for Lincoln Road directory advertising were short
of Minimum Annual Guarantees by approximately $45,283 during the life of the agreement.
2. The Contractor consistently submitted the quarterly revenue payments under both agreements
past the established due date, which represents approximately $8,792 of uncollected late
charges for the City.
3. Several bus shelters inspected showed evidence of not being properly maintained by the
Contractor, as graffiti was not removed in a timely manner in accordance with the terms of the
agreements.
4. The Finance Department does not date-stamp payments when received from the Contractor.
Since there are established due dates, the City is failing to require or collect late payment
charges due from the Contractor. The accuracy of revenue payments based on percentage
guarantees is not being reviewed by Finance. Furthermore, payments received are not being
recorded to the EDEN system in a timely manner.
5. The title of the general ledger account used to record revenue receipts from bus shelters and
Lincoln Road directory advertising does not properly reflect the use or purpose of the account.
Additional details regarding the above mentioned areas in need of correction have been provided on
the Findings, Recommendations, and Management Responses section of this report.
PURPOSE
The purpose of this audit is to determine whether the Contractor is complying with key terms and
provisions of their agreements with the City regarding bus shelters and street furniture, and directory
structures in the Lincoln Road area.
SCOPE
1. Determine compliance with the key provisions of the two agreements, regarding quarterly
revenue receipts, advertising, and insurance coverage, number of shelters I street furniture
and directories to be provided for bus shelters, street furniture and Lincoln Road directories.
2. Verify that the Finance Department is reviewing the accuracy and timeliness of revenue
receipts, and properly entering them into the City's Financial System.
3. Physically inspect bus shelters, street furniture and Lincoln Road directories to ensure proper
maintenance and cleanliness, in accordance with the agreement.
PROCESS DESCRIPTION
Bus shelters and street furniture are constructed or replaced, operated, and maintained as mutually
agreed between the City and the Contractor. The agreement for bus shelters and street furniture
calls for the installation and maintenance of 107 bus shelters and street furniture to consist of the
following: maximum of 180 bus benches; minimum of25 directory structures; minimum of 300 waste
receptacles; minimum of 50 bicycle racks; minimum of 20 multi-purposes pillars; and a minimum of
75 news paper rack. The initial agreement for Lincoln Road Directories specifies the installation and
maintenance of 10 directory structures and 10 street and block name signs. A subsequent
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Internal Audit Report
Bus Shelters and Lincoln Road Directories Agreements
May 28, 2010
amendment added an additional directory structure and 1 0 more street name signs.
All activities related to revenue generation from advertising are the responsibility of the Contractor,
who is to ensure that this is done in compliance with Federal, State, County and City laws, rule and
regulations. The City shall receive revenue payments by the 51h day of the month following the end
of each quarter, consisting of one quarter of the minimum annual guarantee, plus a percentage of
net revenue sharing.
Lincoln Road directory structures were constructed and are being operated and maintained by the
Contractor. Similarly, all advertising and compliance with laws, rule and regulations is the
responsibility of the Contractor. Revenue payments to the City are also to be submitted by the 51h
day of the month following the end of each quarter. These consist of one quarter of the minimum
annual guarantee per structure or a percentage of total net revenue for the quarter, whichever is
greater.
The Public Works Department, through its Special Projects Coordinator, oversees new construction
and/or replacement of bus shelters and street furniture, and Lincoln Road advertising directories.
Public Works also monitors contractor's maintenance of these structures, as well as reviews
quarterly revenue receipts and insurance coverage required under the terms of the agreement. This
specifies that bus shelters and street furniture "shall be maintained in a neat and clean condition and
in good repair at all times." The Contractor's maintenance program, included as part of the
agreement, describes monthly inspections of these structures, and cleaning on a weekly basis.
These include scheduled or instant repair requirements, graffiti and sticker removal, etc.
The Finance Department has the responsibility of ensuring that revenue payments are accurately
calculated and received from the Contractor within the established payment timeframe, as well as
collect payment of any revenue shortages and late payment fees.
FINDINGS, RECOMMENDATIONS, AND MANAGEMENT RESPONSES
1. Finding-Revenue payments made by the Contractor for Lincoln Road advertising were short
of Minimum Annual Guarantees.
At the time the agreement between the City and the Contractor was signed for Lincoln Road
directory structures in April2001, these directory structures were not in place. When the initial
agreement was amended on November 2002, the initial term was extended from five to seven
years, but the amendment specifically stated that the commencement date remained the same
or April18, 2001. The Contractor agreed to pay the City the greater of an annual amount per
structure or a percentage of net advertising revenues, as summarized below:
YEAR Net Revenues
1 20%
2-3 25%
4-5 28%
6-7 30%
8-12 (extension) 30%
According to the Contractor, there were no advertising revenues until January 2003, since the
structures were in the development and construction phases, and the first revenue payment
was made for the quarter ending March 31, 2003. This payment was calculated based on the
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Internal Audit Report
Bus Shelters and Lincoln Road Directories Agreements
May 28, 2010
net revenue percentage for Year 1 (20 %) instead of the percentage for Year 2 (25 %).
According to our calculations (see Exhibit A), the impact of the Contractor's interpretation for
the first contract year represents a shortage of $47,236 in revenue payments to the City. It
should be noted that the Special Projects Coordinator in the Public Works Department made
an inquiry to the Contractor on July 2007, regarding the discrepancy of revenue percentages
in the payment calculation, but there was no follow-up to the response provided by the
Contractor. The Contractor contended that when the contract was signed, the Lincoln Road
directories did not exist and no revenues were being generated; that an amendment to the
original agreement adjusted the contract start date from April18, 2001 to November 15, 2002;
and that Clear Channel started receiving revenues in January 2003, at which time they began
following the revenue percentage sharing with the City.
Recommendation(s)
Since the Contractor is calculating quarterly revenues due to the City based on an incorrect
contract start date, the terms of the agreement and subsequent amendment, should be
brought to their attention, specifically the fact that the commencement date of the agreement
remained as April18, 2001, as stated on page 2 of the amendment to the agreement executed
November 13, 2002. In conjunction with this, the City should inform the Contractor of the
revenue shortage amount for the Lincoln Road directories and request payment of revenues
due.
Contractor's Response
Here is the correspondence from our July 2007 response mentioned above, which remains
our point of contention. Please note that since we did not receive a reply, we believed that the
issue was resolved.
Hi Leo,
We have reviewed your comments below and looked into the issue. We don't agree with
your assessment due to the following reasons:
1. The Lincoln Road Directories were not in existence when we entered into the contract,
thus no revenue was generated during the development and build-out period. The
directories were still to be designed, manufactured, and installed. In addition, shortly before
construction start, the city changed their previous instructions regarding permitting, which
added some more time to it.
2. While the agreement is dated April18, 2001 the City and our company agreed in Nov
2002 to adjust the contract start date to 11115/02 due to the facts listed above.
3. We then had to develop the business (i.e. market the opportunity to the advertising
industry, create sales demand, etc.) and did not have any revenues until January 1, 2003.
From then on, we followed the revenue percentage share exactly as listed in the
agreement. We believe that we have made all payments correctly.
Please let me know how we can further be of assistance or if you wish to discuss this
matter.
Regards,
Martina
City's Response (Public Works)
Contractor will be notified to pay balance due. The agreement, dated November 13, 2002,
extended the contract by two years, but it did not change the start date. The agreement
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Internal Audit Report
Bus Shelters and Lincoln Road Directories Agreements
May 28, 2010
extended the contract by two years in consideration of ten additional street name signs and
one additional two-sided directory structure to be placed at the intersection of James Avenue
and Lincoln Road, at no cost to the City.
Although Clear Channel did not generate revenue during the development and construction
period, the contract start date remained April 18, 2001. Therefore, the City's percentage of
total net revenues also begins with the contract's start date.
2. Finding -The Contractor consistently submitted late quarterly revenue payments.
Both agreements with the Contractor state that the City shall receive revenue payments no
later than the fifth day of the month after the close of the quarter. The agreements also state
that payments not made on or before the due date shall be subject to interest at a rate of 12 %
per annum, from the payment due date until the time the payment is received by the City. We
found that throughout the life of both agreements, the Contractor has consistently submitted
the payments late. For the calculation of late charges, we used the number of days from the
due date to the date the Contractor sent the payment, since the Finance Department does not
date stamp payments when received. The total of uncollected charges for late revenue
payments amounts to $8,792, consisting of $2,234 for the agreement on Lincoln Road
directory structures since April 2003 (see Exhibit A), and $6,558 for payments on the bus
shelter agreement since November 2002 (see Exhibit B).
Recommendation(s)
The Contractor should be informed and billed for the uncollected charges due to the City on
late revenue payments during the life of both agreements. If the City and Contractor feel that
the five day payment requirement is not feasible for these types of agreements, then
consideration should be given to amend the established due dates within the agreements.
Contractor's Response
The President of Clear Channel Adshel, had a personal conversation with the Public Works
Director very early in the contract period when we realized that the payment date should have
been much later then the 5th of the month. It was mutually agreed that it wasn't physically
possible to close the monthly books, reconcile revenue and cut a check and have it received
by the City, all by the 5th of the month. We both felt that this must have been a typo and
should have been the 25th, or at least the 15th. We then asked the contract be changed to
reflect a more realistic date and to prevent exactly what is happening now. The Public Works
Director said that in order to do that we would have to go before the City Commission and he
requested not to go before them for this. It was verbally agreed that we would send the
payment as soon as we could, following the end of each quarter.
City's Response (Public Works)
The Contractor will be advised that the payment due date remains the same. However, the
Contractor will also be advised that the City is willing to consider modifying the due date based
upon a review of the process required to calculate the amount due to the City.
Internal Audit Observation
Collection of late fees should be addressed with the contractor for both agreements. In
addition, any changes to the agreement should be approved by the City Commission.
3. Finding -Bus Shelters are not maintained as required by the agreement.
We selected a sample of 20 bus shelters of the 1 00 identified by the Public Works Department
and a current maintenance report summary prepared by the Contractor. The shelters were
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Internal Audit Report
Bus Shelters and Lincoln Road Directories Agreements
May 28, 2010
initially visited on March 24, 2009 through March 25, 2009 to inspect them for adequacy of
advertising display contents, accessibility, cleanliness/appearance, and public safety. A
follow-up inspection was done several days later on April 3, 2009, to allow time for
maintenance work to be done on those shelters where deficiencies were observed during the
initial inspection. We found eight shelters that had not received adequate maintenance by the
Contractor to remove graffiti on the glass panels, and painted or metal surfaces. The
Contractor's maintenance program requires the cleaning of bus shelters and street furniture
structures, including graffiti removal, to be done weekly. One of the bus shelters inspected is
in a poor state of repair, missing the back panels of the structure. The improper appearance
of bus shelters and street furniture presents a negative image of the City. We also inspected
all Lincoln Road directory displays for advertising content and appearance; these were all
adequate.
Recommendation(s)
The Contractor should comply with their maintenance program for the proper maintenance
and appearance of the bus shelters. We also recommend that the City periodically conduct
their own inspections of these structures and street furniture to ensure the Contractor is
complying with their obligations under the agreement.
Contractor's Response
Currently, Clear Channel Outdoor is in the final stages of completing the street furniture
program. Within this program we are obtaining new bus shelter sites along with converting all
existing structures to the new design. In 2009, a program was implemented to repaint and
replace the glass of the structures pending conversion to the new design. The manufacturer,
Daytech, of the old style units is no longer in business and replacement parts for this particular
model are nonexistence. We make every effort to maintain these old units with existing
materials until we have the opportunity to complete the conversions. The bus shelters are
maintained on a weekly basis and on occasion, we are notified by the Public Works
Department of various maintenance issues, which are addressed and repaired within a 24
hour period.
City's Response (Public Works)
The Public Works Department performs periodic inspections to verify compliance with the
agreement. When deficiencies are found, they are communicated to the Contractor for
correction. The Public Works Department has increased the frequency of its 2009/10 fiscal
year inspections to address cleanliness and graffiti issues.
4. Finding -Quarterly revenue receipts are not being processed in a proper or timely manner.
The Contractor submits quarterly payments for advertising revenues due for bus shelters
(customer # C 12269) and Lincoln Road directories (customer # C 12269A) to the Revenue
Supervisor in the Finance Department. Financial Analysts in the Department prepare payment
vouchers with the information received from the Contractor (transmittal letter, quarterly
revenue reports, and check payments) and include the date they process the payments.
However, none of these documents are being stamped to evidence date received. Although
the payment due date and the revenue guarantee terms are detailed on the payment voucher,
the Finance Department does not take any action when these requirements are not met by the
Contractor. Both agreements require revenue payments to be received on or before the 5th
day of the month following the close of a quarter. Additionally, these revenue payments are
not being recorded on the City's Financial System in a timely manner, since the posting date
ranges from 5 to 63 days for customer C 12269 and from 3 to 50 days for customer C 12269A.
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Internal Audit Report
Bus Shelters and Lincoln Road Directories Agreements
May 28, 2010
Recommendation(s)
The Finance Department should date-stamp payment correspondence from the Contractor to
accurately document when these are received. This date should be reflected on the payment
vouchers prepared by the Financial Analyst(s). The terms of the agreements regarding due
date should be verified by Finance, and any discrepancies identified should be addressed
accordingly.
City's Response (Finance)
The Finance Department will date-stamp payment correspondence from the Contractor to
document when payments are received. The date will be reflected on the payment vouchers
prepared by the financial analyst responsible for recording these transactions. The Finance
Department Collections Supervisor along with the Contract Manager from the Public Works
Department will monitor payments from the Contractor and address late payments accordingly.
5. Finding -.General Ledger account is incorrectly titled.
The title for general ledger account# 011-8000-362400-Rent-Bus Shelters-Taxable-does
not properly reflect the purpose and use of this account, since revenues received for Bus
Shelters, as well as Lincoln Road directories are posted to the account. Additionally, these
revenues are not taxable, although both agreements state that payments submitted by the
Contractor were to include applicable Florida State Sales and Use taxes. It appears that tax
payments were being initially sent together with the revenue payments. However, since
February 2003, the Contractor informed the City that advertising revenues were not taxable by
the State. The City acknowledged and agreed with the Contractor on this issue.
Recommendation ( s)
The Finance Department should evaluate whether it wants to continue posting Lincoln Road
area advertising revenues to the same general ledger account set up for bus shelters
revenues, or modify the account title to properly reflect the two areas. In addition, the title's
reference to taxable should be removed.
City's Response (Finance)
The reference in the general ledger title to "taxable" has been removed. Currently, Finance
Department Revenue staff record Lincoln Road area advertising revenues to the same general
ledger account set up for bus shelters revenues as originally requested by staff managing the
contracts. Revenue staff will coordinate, with the Public Works Department and Chief
Accountant's Office, to create an additional general ledger account to separately record the
revenues for the aforementioned activities. Accounts were added May 12, 2010.
EXIT CONFERENCE
An exit conference call was held on January 19, 2010 with Paul Newman, Vice President of
Finance, Clear Channel Outdoor -Miami, James Sutter, Internal Auditor and Luis Lopez, Audit
Consultant. Their written management responses were received on February 11, 2010 whereby
they disagreed to findings one and two and stated their position. Finally, management responses
were received from affected City departments on March 20, 2010 and May 27, 2010 so that the audit
report could be issued shortly thereafter.
JJS:LL:II
Audit performed by Luis Lopez, Internal Audit Contractor
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Internal Audit Report
Bus Shelters and Lincoln Road Directories Agreements
May 28, 2010
F:\obpi\$AUD\INTERNAL AUDIT FILES\DOCOS-09\REPORTS-FINAL\Bus Shelters-Lincoln Rd Directories.doc
cc: Jorge Gomez, Assistant City Manager
Fred Beckman, Public Works Director
Fernando Vazquez, City Engineer
Patricia D. Walker, Chief Financial Officer
Paul Newman, Vice President of Finance, Clear Channel Outdoor-Miami.
Page 8 of 10
Internal Audit Report
Bus Shelters and Lincoln Road Directories Agreements
May 28, 2010
Exhibit A-Lincoln Road Advet·tising
(I) (2)
Period Revenue Contract •y., CCA % Payment
Year(s) Guarantee Year I' aid Due
4/18/0 l-I 20% 4/30/02
May-Dec 02 25%
2
Jan 03-Mar 03 50,965 25% 20% 12,741
Apr 03-J un 03 68,240 2&3 25% 20% 15,691
I
.lul 03-Sep 03 95,860 25% 20% 23,965
Oct 03-Dec 03 55,698 25% 20% 13,925
3
Jan 04-Mar 04 46,150 25% 25% 10,897
Apr-04 22,325 25% 25% 5,581
May 04-Jun 04 49,275 28% 2 25% 13,797
Jul 04-Sep 04 68,300
4
28% 25% 19,124
Oct 04-Dec 04 65,074 28% 25% 18,221
Jan 05-Mar 05 77,700 28% 25% 21,756
Apr 05-Jun 05 98,300 4&5 28% 25% 27,524
3
Jul 05-Sep 05 96,550 28% 25% 27,034
Oct 05-Dec 05 90,900 28% 25% 25,452
5
Jan 06-Mar 06 96,480 28% 28% 27,014
Apr-06 38,800 28% 28% 10,864
May 06-Jun 06 62,300 30% 4 28% 18,690
Jul 06-Sep 06 134,950
6
30% 28% 39,667
Oct 06-Dee 06 131,525 30% 28% 39,458
Jan 07-Mar 07 129,007 30% 28% 38,702
Apr 07-Jun 07 125,877 6&7 30% 28% 37,110
5
Jul 07-Scp 07 138,842 30% 28% 41,653
Oct 07-Dcc 07 143,187 7 30% 28% 42,956
Jan 08-Mar 08 126,085 30% 30% 37,826
Apr 08-Jun OS 125,056 7 & 8 30% 30% 37,517
6
Jul 08-Sep 08 98,137
8
30% 30% 28,758
Oct 08-Dec 08 90,854 30% 30'% 27,256
(l) Contract year used by Clear Channel Adshcl (CCA) in revenue sharing calculations.
(2) Payment due and sent amounts arc net of costs for maps and mall directories.
(2)
Payment
Sent
0.00
0.00
10,193
12,279
19,172
11,140
!0,897
17,900
17,075
16,269
19,425
24,575
24,138
22,725
27,014
28,308
36,967
36,827
36,122
34,593
38,876
40,092
37,825
37,517
28,758
27,256
(3) No difTerenee is noted due to percentage rate guanmteed to percentage rate paid being equal.
(4) Late Charge is calculated based on payment sent, 12% per annum, days late and 365 year base.
(*) Quarterly revenue was estimated based on payment amount posted to EDEN.
Page 9 of 10
(4)
Difference Date Days Late
Paid Late Charge
2,548 04/15/03 lO 34
3,412 07/16/03 ll 44
4,793 10/!7/03 12 76
2,785 0 l/14/04 9 33
(3) 04/13/04 8 29
1,478 07/15/04 10 59
2,049 10/13/04 8 45
1,952 Reports not available (*)
2,331 04/14/05 9 57
2,949 071!4/05 9 73
2,896 l0/13/05 8 63
2,727 0 l/17/06 12 90
(3) 04/20/06 15 133
1,246 38,918.00 15 140
2,700 10/30/06 25 304
2,631 0 l/17/07 12 145
2,580 04/!7/07 12 143
2,517 071!9/07 14 159
2,777 101!8/07 13 166
2,864 Ol/15/08 10 132
(3) 041!4/08 9 ll2
(3) 07/l0/08 5 62
(3) lOll 0/08 5 47
(3) Ol/15/09 10 90
Internal Audit Report
Bus Shelters and Lincoln Road Directories Agreements
May 28, 2010
Exhibit B-Bus Shelters
Amount Revenue Sharing Payment Payment Other Pmts
Period Guarantee Revenues •y., Amount Due Sent or Credits
Nov 0 1-Jan 02 15,000 Reports 10% -
15,000 Not 10% Reports Not Available
Available -
May-Jul 02 15,000 10%
Aug-Oct 02 15,000 262,585 10% 26,259 41,259 26,259 16,707
Nov 02-Jan 03 30,000 220,660 10% 22,066 52,066 22,066 30,000
Feb-Apr 03 30,000 270,578 IO'X. 27,058 57,058 57,058
May-Jul 03 30,000 260,901 10% 26,090 56,090 40,753 15,337
Aug-Sep 03 20,000 106,182 10% 10,618 30,618 6,526 (24,092)
Oct-Dec 03 30,000 267,978 10% 26,798 56,798 50,096 (6,702)
Jan-Mar 04 30,000 222,200 10% 22,220 52,220 52,220
Apr-Jun 04 30,000 300,407 10% 30,041 60,041 60,041
Jui-Scp 04 30,000 286,374 10% 28,637 58,637 58,637
Oct04 85,909 10% 8,59!
30,000 73,940 62,157 1!,783
Nov -Dec 04 235,660 !5% 35,349
Jan-Mar 05 30,000 254,430 15% 38,165 68,165 68,164
Apr-Jun 05 30,000 277,748 !5% 41,662 71,662 71,662
.lui-Sept 05 30,000 329,467 15% 49,420 79,420 79,420
Oct-Dec 05 30,000 418,665 15% 62,800 92,800 92,800
Jan-Mar 06 30,000 354,481 15% 53,!72 83,172 83,!72
Apr-.ltm 06 30,000 385,53! 15% 57,830 87,830 87,830
Jui-Sep 06 30,000 311,323 15% 46,698 76,698 76,699
Oct06 204,264 !5% 30,640
30,000 106,566 95,084 !!,482
Nov-Dec 06 229,630 20% 45,926
Jan-Mar 07 30,000 216,279 20% 43,256 73,256 73,256
Apr-.ltm 07 30,000 5!2,547 20% 102,509 132,509 132,509
Jul-Scp 07 30,000 364,077 20% 72,815 102,815 102,815
Oct-Dec 07 30,000 451,823 20% 90,365 120,365 120,365
Jan-Mar 08 30,000 243,540 20% 48,708 78,708 78,708
Apr-Jun 08 30,000 478,25! 20% 95,650 125,650 125,650
Jul-Sep 08 30,000 249,90! 20% 49,980 79,980 79,980
Oct-Dec 08 50,000 346,653 20%. 69,331 119,331 69,331 50,000
(*) Late Charge is calculated based on payment sent, 12% per annum, clays late and 365 year base.
Page 10 of 10
Date Days (*)Late
Paid Late Charge
11/20/02 15 129
02/18/03 13 94
05/13/03 8 150
Reports Not Available
10/27/03 22 47
01/15/04 10 165
04/13/04 8 137
07/!5/04 10 197
l 0/!3/04 8 !54
01/!3/05 8 163
04/!4/05 9 202
07/14/05 9 2!2
10/13/05 8 209
Ol/!7/06 !2 366
04/20/06 !5 410
07/20/06 15 433
10/28/06 23 580
Ol/17/07 12 375
04117/07 12 289
07/19/07 14 6!0
I 0/18/07 !3 439
0 l/15/08 lO 396
04/14/08 9 233
07/!0/08 5 207
10/10/08 5 131
Ol/15/09 !0 228