Edward G Smith and Jan M. Smith - Page 3

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               Initially, Smith Floors’ operations were modest and limited            
          to flooring installation services.  Smith Floors would dispatch             
          its employees to a job site to install flooring materials that              
          had been ordered by and delivered to the general contractor.                
          Running its business in this fashion exposed Smith Floors to                
          operational disruptions arising from errors by contractors in               
          ordering flooring materials and scheduling installations.  To               
          avoid these disruptions, and to increase Smith Floors’ range of             
          services, petitioner decided to expand Smith Floors’ operations             
          by obtaining warehouse space which would allow Smith Floors to              
          acquire and hold the flooring materials that it would install               
          pursuant to its flooring installation contracts.                            
               Smith Floors operates its business out of an 8,500 square              
          foot commercial building in Riverside, California.  Smith Floors            
          uses 6,000 square feet of space as warehouse area and 2,500                 
          square feet of space as showroom and office areas.                          
               Smith Floors receives invitations to bid on jobs from                  
          architects, contractors, and developers.  Prior to submitting a             
          bid, Smith Floors receives floor plans for the job and                      
          specifications identifying the flooring materials to be                     
          installed.  Although petitioner makes product recommendations,              
          Smith Floors generally has no discretion as to manufacturer,                
          type, grade, or color of the flooring materials that it installs.           

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Last modified: May 25, 2011