Exhibit 1 Operating Statements for Years Ending December 31, 2011–2013, and for First

Quarter 2014 (thousands of dollars)

2011 2012 2013 First Quarter 2014

Net sales $1,697 $2,013 $2,694 $ 718a

Cost of goods sold
Beginning inventory 183 239 326 418
Purchases 1,278 1,524 2,042 660
$1,461 $1,763 $2,368 $1,078
Ending inventory 239 326 418 556
Total cost of goods sold $1,222 $1,437 $1,950 $522
Gross profit 475 576 744 196
Operating expenseb 425 515 658 175
Interest expense 13 20 33 10
Net income before taxes $37 $41 $53 $11
Provision for income taxes 6 7 9 2
Net income $31 $34 $44 $9

Source: Case author.

a
In the first quarter of 2013 sales were $698,000 and net income was $7,000.
b
Operating expenses include a cash salary for Mark Cartwright of $75,000 in 2011, $85,000 in 2012, $95,000 in 2013, and
$22,000 in the first quarter of 2014. Cartwright also received some of the perquisites commonly taken by owners of
privately held businesses.

In thousands

2014 2015 2016 2017

Net sales 3600 4811 6429 8590
Total cost of goods sold 2589 3460 4624 6179
Gross profit 1011 1351 1805 2412
Operating expenseb 901 1204 1608 2149
EBITDA 110 147 196 263
D&A 0 0 0 0
EBIT 110 147 196 263
Taxes 18 25 33 44
EBIAT 92 122 164 219
D&A 0 0 0 0
Delta CAPEX -72.0 -96.2 -128.6 -171.8
Delta WC -135.6 -193.6 -258.7 -345.7
FCFF -116 -167 -224 -299
 2018 Sales Growth Rate 34%
11479
8257 2011 2012 2013 Average
3223 Gross Profit Margin 72% 71% 72% 72%
2872
351 2011 2012 2013 Average
0 OPEX 25% 26% 24% 25%
351
59 2011 2012 2013 Average
292 Taxes 16% 17% 17% 17%
0
-229.6
-462.0 2011 2012 2013 Average
-399 CAPEX 1 0.70% 0.63% 0.663%
CAPEX 2 14 17 15.5

2013 2014 2015 2016

Accounts receivable, 317 394 527 704
Inventory 418 550 734 981
Accounts payable 256 316 423 565
Accrued expenses 39 52 70 93
WC 440 576 769 1028
Delta WC -136 -194 -259

2011 2012 2013 Average

AR 10% 11% 12% 11%
Inventory 20% 23% 21% 21%
AP 10% 13% 13% 12%
AE 6% 6% 6% 6%
Expansion
2%

2017 2018
941 1258
1312 1753
755 1008
 125 167
1374 1836
-346 -462

Sales
COGS
COGS
OPEX
Exhibit 2 Balance Sheets at December 31, 2011–2013, and March 31, 2014 (thousands of
dollars)

2011 2012 2013 First Quarter 2014

Cash $58 $48 $41 $31

Accounts receivable, net 171 222 317 345
Inventory 239 326 418 556
Current assets $468 $596 $776 $932
Property, net 126 140 157 162
Total assets $594 $736 $933 $1,094

Notes payable, bank $ -- $146 $233 $247

Notes payable, Stark 105 -- -- --
Notes payable, trade -- -- -- 157
Accounts payable 124 192 256 243
Accrued expenses 24 30 39 36
Long-term debt, current portion 7 7 7 7
Current liabilities $260 $375 $535 $690
Long-term debt 64 57 50 47
Total liabilities $324 $432 $585 $737
Net worth 270 304 348 357
Total liabilities and net worth $594 $736 $933 $1,094

Source: Case author.