##### Table of Contents



SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 10-K
 ANNUAL REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
 For the fiscal year ended April 30, 2006
 Commission
file number 0-10146
 SERVIDYNE, INC.
  Georgia
    
    58-0522129(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    identification No.)1945 The Exchange, Suite 300, Atlanta, GA
    
    30339-2029(Address of principal executive offices)
    
    (Zip Code)
   Title of each class:
    
    Name of each exchange on which registered:None
    
    None
  
  o NO þ
  o NO þ
  YES þ o
 þ
  o o Non-Accelerated Filer þ
  o NO þ




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TABLE OF CONTENTS  PART IITEM 1. BUSINESSITEM 1A. RISK FACTORSITEM 1B. UNRESOLVED STAFF COMMENTSITEM 2. PROPERTIESITEM 3. LEGAL PROCEEDINGSITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERSPART IIITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY AND RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIESITEM 6. SELECTED FINANCIAL DATAITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSUREITEM 9A. CONTROLS AND PROCEDURESITEM 9B. OTHER INFORMATIONPART IIIITEMS 10-14PART IVITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-KSIGNATURESEX-10.J FORM OF STOCK APPRECIATION RIGHTS AGREEMENTEX-21 LIST OF SUBSIDIARIESEX-23.A CONSENT OF DELOITTE & TOUCHE LLPEX-31.1 SECTION 302 CERTIFICATION OF THE CEOEX-31.2 SECTION 302 CERTIFICATION OF THE CFOEX-32.1 SECTION 906 CERTIFICATION OF THE CEOEX-32.2 SECTION 906 CERTIFICATION OF THE CFO    Table of Contents  
 PART I
 
        ® ® ® ® ® ® ®
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2




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PART I (continued)
   April 30,2006
    
    
    2005Energy and
Facilities
Solutions(1)
    
    $
    3,526,000
    
    
    
    $
    2,433,000Energy
Services(2)
    
    
    2,160,000
    
    
    
    
    2,665,000Real
Estate(3)
    
    
    6,058,000
    
    
    
    
    6,132,000Less: Intersegment Eliminations
    
    
    (548,000
    )
    
    
    
    (532,000
    )Total Backlog
    
    $
    11,196,000
    
    
    
    $
    10,698,000
 (1)
    
    The increase in backlog is primarily due to a substantial increase in energy engineering
consulting contracts. Backlog includes
contracts that can be cancelled with less than one years notice, with the assumption that such
cancellation provisions will not be
invoked. The cancellation rate for such contracts in the previous twelve months was approximately
9%.(2)
    
    The decrease in backlog is primarily due to a consulting services contract that was included in
prior year, fiscal 2005.(3)
    
    The decrease in backlog is primarily due to the absence of rental revenues from the Companys
former leaseback interest in a
shopping center in Bayonet Point, Florida, which interest was sold at a gain in April 2006.
      Alan R. Abrams(51)
    
    Officer since 1988
  Mark J. Thomas(50)
    
    Officer since 2003
  Melinda S. Garrett(50)
    
    Officer since 1990
  J. Andrew Abrams(46)
    
    Officer since 1988
  M. Todd Jarvis(40)
    
    Officer since 2006
  3




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The Companys business depends on the success of its relatively new building performance, energy
and
facilities services offerings. If the Company fails to develop these lines of business, its
prospects will be
adversely affected.
    
    
    the ability to develop new products and services for the Energy and Facilities Solutions and
Energy Services
Segments, and the ability to keep current products and services competitive;
    
    the ability to make profitable acquisitions and the ability to integrate them into existing
operations;
    
    hiring, training and retention of qualified personnel;
    
    the establishment of new relationships or expansion of existing relationships with customers and
suppliers; and
    
    the availability of capital.
  The Company is redeploying a portion of its capital previously invested in the Real Estate Segment
to develop
the Energy and Facilities Solutions and Energy Services Segments. The Company cannot guarantee that
the
return on investing these resources in the new segments, if any, will exceed the return that might
otherwise be
achievable from the Real Estate Segment.
   4




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PART I (continued)
  In recent years, net earnings have been driven significantly by gains from the sale of commercial
properties.
Without such gains, the Company might not be profitable in the
future.
   If the Company cannot find suitable acquisition candidates, or integrate completed acquisitions
successfully,
its prospects could be adversely affected.
    The Company may not be able to raise the additional capital necessary to implement its growth
strategy.
  5




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If the Company implements its growth strategy, but is unable to manage its growth, the
Companys sales and
profitability might be adversely affected.
  The Company is dependent upon key personnel, the loss of any of whom could adversely impair the
Companys
ability to conduct its business. In addition, the development of the Companys new businesses will
require the
addition of suitable personnel.
   The Company is subject to changing regulations regarding corporate governance and required public
disclosure
that have increased both the costs of compliance and the risks of noncompliance. As a smaller
public company,
these costs of compliance may affect the Company disproportionately as compared with larger
competitors.
     6




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PART I (continued)
   General economic and market risks.
 
    
    Changes in the national, regional and local economic climate;
    
    Local conditions such as an oversupply of properties or a reduction in demand for properties;
    
    The attractiveness of the properties to tenants;
    
    Competition from other available properties;
    
    Changes in market rental rates; and
    
    The need to periodically repair, renovate and re-lease space.
  Leasing risk.
 Uninsured losses and condemnation costs.
 Environmental issues.
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Any failure to sell income-producing properties on a timely basis could adversely affect the
Companys results
of operations.
  The Company might not be able to refinance its income-producing properties on a timely basis or on
acceptable terms.
   Failure
to adequately expand the Companys sales force may impede its growth.
   As more of the Companys sales efforts are targeted at larger enterprise customers, its sales cycle
may become
more time-consuming and expensive, the Company may encounter pricing pressure and implementation
challenges, and the Company may have to delay revenue recognition on these customers, all of which
could
harm the Companys business.
  8




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PART I (continued)
 The value to customers of the various energy efficiency products and services offered by the
Companys Energy
and Facilities Solutions Segment and Energy Services Segment is substantially impacted by the
prevailing
market prices of energy; if these prices were to decline, sales of the Companys energy efficiency
products and
service offerings might not grow, or could even decline.
  The Company may be subject to potential liabilities as a result of construction or design defects,
product
liability, or warranty claims made.
  A portion of the Companys revenues are derived from fixed price contracts, which could result in
losses
on contracts.
  The Company is largely dependent on the continued availability and satisfactory performance of its
subcontractors, whose potential unavailability or unsatisfactory performance could have a material
adverse
effect on the Companys business.
  The Company could be exposed to environmental liability related to the disposal of hazardous
materials.
  9




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If the Companys new comprehensive energy, infrastructure and productivity management Application
Software Provider (ASP) offerings are not widely accepted, the Companys operating results could
be harmed.
   
    
    reluctance by enterprises to migrate to an ASP product from more traditional products in
which the software and related data is hosted and controlled locally by the customer;
    
    the price and performance
of the Companys ASP offering;
    
    the level of customization the Company can offer;
    
    potential adverse publicity about the Company, its service or the viability, reliability or
security of ASP products generally from third party reviews, industry analyst reports or
adverse statements made by competitors.
  Defects or disruptions in the Companys comprehensive energy, infrastructure and productivity
management software solutions could diminish demand for these offerings and could potentially
subject the Company to substantial liability.
    If the Company were unable to develop enhancements and new features for the Energy and Facilities
Solutions and Energy Services Segments existing products and services, or were unable to develop
acceptable new products and services that kept pace with technological developments, the Companys
business might be harmed.
  10




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PART I (continued)
  If the Companys security measures are breached and unauthorized access is obtained to a customers
data, the offerings of the Energy and Facilities Solutions and Energy Services Segments may be
perceived as not being secure, customers may curtail or stop using the Companys products and
services, and the Company could incur significant liabilities.
  Any failure to protect the Companys intellectual property rights could impair the Companys
ability to protect proprietary technology and its brand.
     Because the Company recognizes revenue from its new ASP offerings over the term of customers
subscription agreements, downturns or upturns in sales may not be immediately reflected in the
Companys operating results .
  11




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Evolving regulation of the Internet may affect the Company adversely.
  
   
       Percentage
    
    
    
    
    
    
    
    
    
    Rental
    
    
    
    
    
    Principalof Square
    
    Calendar
    
    
    
    
    
    Income
    
    
    
    
    
    Amount ofLeasable
    
    Footage
    
    Year(s)
    
    
    
    
    
    Per Leased
    
    Debt
    
    DebtSquare
    
    Leased as of
    
    Placed in
    
    Rental
    
    Square
    
    Service
    
    OutstandingFeet in
    
    April 30,
    
    Service by
    
    Income
    
    Foot
    
    Payments
    
    as of April 30,Location
    
    Acres
    
    Building(s)
    
    2006
    
    Company
    
    2006
    
    2006(1)
    
    2006(2)
    
    2006(3)1075 W. Jackson
Street Morton,
IL(4)
    
    
    7.3
    
    
    
    92,120
    
    
    
    100
    
    
    
    1980, 1992
    
    
    $
    463,225
    
    
    $
    5.03
    
    
    $
    404,969
    
    
    $
    1,924,6882500 Airport
Thruway Columbus,
GA(4)(5)
    
    
    8.0
    
    
    
    87,543
    
    
    
    100
    
    
    
    1980, 1988
    
    
    
    441,286
    
    
    
    5.04
    
    
    
    391,090
    
    
    
    757,9088102 Blanding Blvd.
Jacksonville,
FL(6)
    
    
    18.8
    
    
    
    174,220
    
    
    
    93
    
    
    
    1999
    
    
    
    1,615,226
    
    
    
    9.97
    
    
    
    610,238
    
    
    
    7,546,486
 (1)
    
    Calculated by dividing fiscal 2006 rental income by leased square feet in building (as of
April 30, 2006).(2)
    
    Includes principal and interest.(3)
    
    The Companys liability for repayment is limited to its interest in the respective mortgaged
properties by exculpatory provisions.(4)
    
    Land is leased, not owned.(5)
    
    The center in Columbus, Georgia, is owned by Abrams-Columbus Limited Partnership, in which the
Companys subsidiary, Abrams Properties, Inc., serves as general partner and owns an 80% interest.(6)
    
    Originally developed by third parties in 1985.
 12




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PART I (continued)
  LeaseSquare
    
    Expiration
    
    OptionsAnchor Tenant(1)
    
    Footage
    
    Date
    
    to RenewHarbor Freight Tools
    
    
    12,500
    
    
    
    2012
    
    
    4 for 5 years eachPublix(2)
    
    
    85,560
    
    
    
    2010
    
    
    6 for 5 years eachOffice Depot
    
    
    22,692
    
    
    
    2008
    
    
    2 for 5 years each
 (1)
    
    A tenant is considered to be an Anchor Tenant if it leases 12,000 square feet or more for an
initial lease term in excess of five years.(2)
    
    Tenant has subleased the premises to Floor and Decor Outlets, but remains liable
under the lease until the lease expires.
     Percentage
    
    
    
    
    
    
    
    
    
    Rental
    
    
    
    
    
    Principalof Square
    
    Calendar
    
    
    
    
    
    Income
    
    
    
    
    
    Amount ofLeasable
    
    Footage
    
    Year(s)
    
    
    
    
    
    Per Leased
    
    Debt
    
    DebtSquare
    
    Leased as of
    
    Placed in
    
    Rental
    
    Square
    
    Service
    
    OutstandingFeet in
    
    April 30,
    
    Service by
    
    Income
    
    Foot
    
    Payments
    
    as of April 30,Location
    
    Acres
    
    Building(s)
    
    2006
    
    Company
    
    2006
    
    2006(1)
    
    2006(2)
    
    20061945 The Exchange
Atlanta, GA(3)
    
    
    3.12
    
    
    
    65,880
    
    
    
    100
    
    
    
    1997
    
    
    $
    1,311,886
    
    
    $
    19.91
    
    
    $
    443,614
    
    
    $
    4,627,9321501-1523 Johnson
Ferry Rd. Marietta,
GA(4)
    
    
    8.82
    
    
    
    121,476
    
    
    
    75
    
    
    
    1997
    
    
    
    1,457,275
    
    
    
    16.00
    
    
    
    538,925
    
    
    
    5,879,678
 (1)
    
    Calculated by dividing fiscal 2006 rental income by teased square feet in building (as of
April 30, 2006).(2)
    
    Includes principal and interest.(3)
    
    The Companys corporate headquarters building of which the Company leases approximately 25,928
square feet. Rental income includes $540,155 of intercompany rent at a competitive rate paid by the
Company and its operating segments. The building was originally developed by third parties in 1974
and acquired and re-developed by the Company in 1997.(4)
    
    The Company, through a subsidiary of its Real Estate Segment, is the lessee of 5,304 square
feet of space, under a master lease agreement to satisfy a condition required by the lender. As a
result, as of April 30, 2006, rental income includes $27,033 of intercompany rent at a competitive
rate paid by the Real Estate Segment. The office park was originally developed by third parties in
1980 and 1985.
  13




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Square
    
    Calendar Years
    
    Rental
    
    Rental Income
    
    RentFeet in
    
    Placed in Service
    
    Income
    
    Per Square Foot
    
    ExpenseLocation
    
    Acres
    
    Building(s)
    
    by Company
    
    2006
    
    2006(1)
    
    2006Orange Park, FL
    
    
    9.4
    
    
    
    84,180
    
    
    
    1976
    
    
    
    264,000
    
    
    
    3.14
    
    
    
    226,796Davenport, IA
    
    
    10.0
    
    
    
    84,180
    
    
    
    1977
    
    
    
    255,308
    
    
    
    3.03
    
    
    
    179,784Jacksonville, FL
    
    
    11.6
    
    
    
    97,032
    
    
    
    1979
    
    
    
    303,419
    
    
    
    3.13
    
    
    
    258,858Richfield, MN
    
    
    5.7
    
    
    
    74,217
    
    
    
    1979
    
    
    
    300,274
    
    
    
    4.05
    
    
    
    241,904
 (1)
    
    Calculated by dividing fiscal 2006 rental income by square feet in building (as of April
30, 2006).
    Calendar YearDevelopmentLocation
    
    Acres
    
    Completed
    
    Intended Use(1)Mundy Mill Road Oakwood, GA
    
    
    5.3
    
    
    
    1987
    
    
    Commercial development pads or up to four outlotsNorth Cleveland Avenue North Ft. Myers, FL
    
    
    1.9
    
    
    
    1993
    
    
    Two outlotsMetropolitan Parkway Atlanta, GA(2)
    
    
    3.6
    
    
    
    (3
    )
    
    Warehouse, industrial or commercial building, or loft redevelopment
 (1)
    
    Outlot as used herein refers to a small parcel of land platted separately
from a shopping center parcel, which is generally sold to, leased to, or developed as, a fast-food
restaurant, bank, small retail shops, or other commercial use.(2)
    
    Land and building, originally utilized by the Company as a manufacturing and warehouse
facility; owned by AFC Real Estate, Inc., formerly known as Abrams Fixture Corporation.(3)
    
    The Company assembled the property in a series of transactions. The building was developed by
third parties prior to 1960. The Company has entered into a contract to sell the property, at a
gain. The contract specifies a closing date in fiscal 2007. The sale is subject to customary
conditions, and there can be no assurance that the sale will close.
 14




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PART I (continued)
    
   
   
 PART II
 
 ITEM 5.
    
    MARKET FOR REGISTRANTS COMMON EQUITY AND RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES
OF EQUITY SECURITIES
 Market Prices
    
    Dividends Paid Per ShareFiscal 2006
    
    
    Fiscal 2005
    
    Fiscal 2006
    
    
    Fiscal 2005High
    
    Low
    
    
    High
    
    LowTrade
    
    Trade
    
    
    Trade
    
    TradeFirst Quarter
    
    $
    10.44
    
    
    $
    3.91
    
    
    
    $
    4.09
    
    
    $
    3.42
    
    
    $
    0.036
    
    
    
    $
    0.18Second Quarter
    
    
    8.07
    
    
    
    4.35
    
    
    
    
    3.68
    
    
    
    3.28
    
    
    
    0.036
    
    
    
    
    0.036Third Quarter
    
    
    5.15
    
    
    
    3.98
    
    
    
    
    6.18
    
    
    
    2.92
    
    
    
    0.036
    
    
    
    
    0.036Fourth Quarter
    
    
    6.00
    
    
    
    4.01
    
    
    
    
    6.91
    
    
    
    3.67
    
    
    
    0.036
    
    
    
    
    0.036
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Years Ended April 30,
    
    2006
    
    
    2005
    
    2004
    
    2003
    
    2002Net Earnings (Loss)(1)
    
    $
    525,766
    
    
    
    $
    1,800,358
    
    
    $
    (1,850,126
    )
    
    $
    (1,073,524
    )
    
    $
    811,774Net Loss Continuing Operations
    
    $
    (205,515
    )
    
    
    $
    (1,388,574
    )
    
    $
    (2,757,814
    )
    
    $
    (2,209,329
    )
    
    $
    (1,834,746
    )Net Earnings  Discontinued Operations
    
    $
    731,281
    
    
    
    $
    3,188,932
    
    
    $
    907,688
    
    
    $
    1,135,805
    
    
    $
    2,646,520Net Earnings (Loss) Per Share(1)*
    
    $
    .15
    
    
    
    $
    .51
    
    
    $
    (.56
    )
    
    $
    (.33
    )
    
    $
    .25Net Loss Per Share  Continuing Operations*
    
    $
    (.06
    )
    
    
    $
    (.39
    )
    
    $
    (.84
    )
    
    $
    (.68
    )
    
    $
    (.57
    )Net Earnings
Per Share Discontinued
Operations*
    
    $
    .21
    
    
    
    $
    .90
    
    
    $
    .28
    
    
    $
    .35
    
    
    $
    .82Consolidated Revenues Continuing Operations
    
    $
    18,689,728
    
    
    
    $
    21,631,570
    
    
    $
    12,325,556
    
    
    $
    10,523,063
    
    
    $
    10,968,909Weighted Average SharesOutstanding at
Year-End*
    
    
    3,531,089
    
    
    
    
    3,526,041
    
    
    
    3,292,137
    
    
    
    3,231,440
    
    
    
    3,247,213Cash Dividends Paid Per Share*
    
    $
    .14
    
    
    
    $
    .29
    
    
    $
    .14
    
    
    $
    .14
    
    
    $
    .14Shareholders Equity
    
    $
    20,946,748
    
    
    
    $
    20,913,411
    
    
    $
    19,997,527
    
    
    $
    21,257,952
    
    
    $
    22,778,876Shareholders Equity Per Share*
    
    $
    5.93
    
    
    
    $
    5.93
    
    
    $
    6.07
    
    
    $
    6.58
    
    
    $
    7.01Working Capital
    
    $
    8,652,086
    
    
    
    $
    10,450,202
    
    
    $
    7,207,333
    
    
    $
    7,638,091
    
    
    $
    9,875,096Depreciation and Amortization  Continuing
Operations(2)
    
    $
    1,376,378
    
    
    
    $
    1,622,494
    
    
    $
    1,739,225
    
    
    $
    1,402,540
    
    
    $
    2,182,487Total Assets
    
    $
    52,410,256
    
    
    
    $
    57,067,172
    
    
    $
    61,876,019
    
    
    $
    73,797,098
    
    
    $
    91,784,369Income-Producing Properties andProperty and
Equipment, net(3)
    
    $
    21,568,121
    
    
    
    $
    21,529,599
    
    
    $
    21,643,856
    
    
    $
    22,213,811
    
    
    $
    22,978,183Long-Term Debt(4)
    
    $
    21,289,542
    
    
    
    $
    22,523,516
    
    
    $
    22,118,717
    
    
    $
    21,154,042
    
    
    $
    21,556,295Total Liabilities
    
    $
    31,463,508
    
    
    
    $
    36,153,761
    
    
    $
    41,878,492
    
    
    $
    52,539,146
    
    
    $
    69,005,493Variable Rate Debt(4)(5)
    
    $
    930,000
    
    
    
    $
    1,000,000
    
    
    $
    1,000,000
    
    
    $
    
    
    
    $
    4,596,683Return on Average Shareholders Equity(1)
    
    
    2.5
    %
    
    
    
    8.8
    %
    
    
    (9.0
    )%
    
    
    (4.9
    )%
    
    
    3.6
    %
 *
    
    Adjusted for stock dividend(1)
    
    Includes continuing operations, discontinued operations and extraordinary items, if any.(2)
    
    Depreciation and amortization for certain sold income-producing properties have been
reclassified as discontinued operations and, therefore, are not included for all periods presented.(3)
    
    Does not include property held for sale, real estate held for future development or sale, or
sold income-producing properties that
have been reclassified as assets of discontinued operations.(4)
    
    Does not include mortgage debt associated with discontinued operations.(5)
    
    Includes short-term and long-term debt.
 
    Accounting for the Impairment or Disposal of Long-Lived Assets,
 16




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PART II (continued)
     
 CHART A
 Years Ended
    
    Increase
    
    Years EndedApril 30,
    

(Decrease)
    
    April 30,
    
    Increase2006
    
    
    2005
    
    Amount
    
    Percent
    
    2005
    
    2004
    
    Amount
    
    PercentEnergy and Facilities Solutions(1)
    
    $
    3,744
    
    
    
    $
    3,487
    
    
    $
    257
    
    
    
    7
    
    
    $
    3,487
    
    
    $
    2,962
    
    
    $
    525
    
    
    
    18Energy Services(2)
    
    
    7,868
    
    
    
    
    9,588
    
    
    
    (1,720
    )
    
    
    (18
    )
    
    
    9,588
    
    
    
    2,602
    
    
    
    6,986
    
    
    NAReal Estate(3)
    
    
    6,571
    
    
    
    
    8,397
    
    
    
    (1,826
    )
    
    
    (22
    )
    
    
    8,397
    
    
    
    6,631
    
    
    
    1,766
    
    
    
    27Total
    
    $
    18,183
    
    
    
    $
    21,472
    
    
    $
    (3,289
    )
    
    
    (15
    )
    
    $
    21,472
    
    
    $
    12,195
    
    
    $
    9,277
    
    
    
    76
 (1)
    
    In the current year, fiscal 2006, Energy and Facilities Solutions revenues increased
approximately $257,000 or 7%, compared to the same period in fiscal 2005, primarily due to:
 a)
    
    an increase in revenues related to energy engineering services of approximately $261,000; andb)
    
    an increase in revenues related to the installation of the Companys new Web/wireless
proprietary facility management software of approximately $96,000;partially offset by:c)
    
    a net decrease in revenues from legacy proprietary software products of $66,000.
 In the prior year, fiscal 2005, Energy and Facilities Solutions revenues increased approximately
$525,000 or 18%, compared to the same period in fiscal 2004,
primarily due to:
 a)
    
    an increase in revenues related to energy engineering services and proprietary Web/wireless
software products of approximately $630,000 derived from contributions from the acquired businesses
and assets of iTendant, Inc., and Building Performance Engineers, Inc., respectively, which were
acquired in April 2004 and May 2004, respectively; andb)
    
    a net increase in revenues from existing proprietary software products of approximately $49,000;partially offset by:c)
    
    a decrease in sales of computer hardware of approximately $154,000.
 (2)
    
    In the current year, fiscal 2006, Energy Services revenues decreased approximately $1,720,000
or 18%, compared to the same period in fiscal 2005, primarily due to:
 a)
    
    the revenues from one large contract in the education and government sector and one large
contract in the retail sector being included in the prior year, fiscal 2005;partially offset by:b)
    
    the recognition of approximately $660,000 in revenues in the first quarter of fiscal 2006 from a
consulting services contract that was substantially performed in prior periods and did not have any
current year associated costs and expenses (See Chart B).
  17




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##### Table of Contents



(3)
    
    In the current year, fiscal 2006, Real Estate revenues from continuing operations decreased
approximately $1,826,000 or 22%, compared to the same period in fiscal 2005, primarily due to:
 a)
    
    one-time revenues of $2,250,000 in prior year (fiscal 2005) from the sale of the Companys
former leaseback interest in a shopping center in Minneapolis, Minnesota, in September 2004; andb)
    
    an associated decrease in leaseback income of approximately $141,000 in the current year (fiscal
2006), related to the leaseback sale mentioned in (a) above;partially offset by:c)
    
    one-time revenues of $425,000 from the sale of the Companys former leaseback interest in a
shopping center in Bayonet Point, Florida, in April 2006; andd)
    
    an increase in rental income in fiscal 2006 of approximately $179,000 related to increased
occupancy.
 In the prior year, fiscal 2005, Real Estate revenues from continuing operations increased
approximately $1,766,000 or 27%, compared to the same period in fiscal 2004, primarily due to:
 a)
    
    one-time revenues of $2,250,000 from the sale of the Companys former leaseback interest in a
shopping center in Minneapolis, Minnesota, in September 2004. There were no leaseback sales in
fiscal 2004;partially offset by:b)
    
    an associated decrease in revenues of approximately $202,000 related to the leaseback sale
mentioned in (a) above; andc)
    
    a decrease in revenues of approximately $128,000 related to another
former leaseback that was assigned by the Company in October 2003 to the fee owner.
   
 CHART B
 Percent ofSegment Revenuesfrom ContinuingOperations for YearsYears Ended April 30,
    
    Ended April 30,2006
    
    
    2005
    
    2004
    
    2006
    
    
    2005
    
    2004Energy and Facilities Solutions(1)
    
    $
    2,031
    
    
    
    $
    2,026
    
    
    $
    1,630
    
    
    
    54
    
    
    
    
    58
    
    
    
    55Energy Services(2)
    
    
    4,705
    
    
    
    
    6,395
    
    
    
    1,822
    
    
    
    60
    
    
    
    
    67
    
    
    
    70Real Estate(3)
    
    
    3,935
    
    
    
    
    4,290
    
    
    
    4,269
    
    
    
    60
    
    
    
    
    51
    
    
    
    64Total
    
    $
    10,671
    
    
    
    $
    12,711
    
    
    $
    7,721
    
    
    
    59
    
    
    
    
    59
    
    
    
    63
 (1)
    
    In the current year, fiscal 2006, the percentage of costs and expenses applicable to
revenues decreased, compared to the same period of fiscal 2005, primarily due to a better
utilization of capacity in energy engineering services, and for all periods presented this
improvement is a result of a change in the mix of services and products sold during the year.(2)
    
    In the current year, fiscal 2006, costs and expenses on a dollar basis decreased approximately
$1,690,000 or 26%, compared to the same period of fiscal 2005, primarily the result of a
corresponding decrease in revenues. On a percentage basis, costs and expenses decreased for fiscal
2006, compared to the same period of fiscal 2005, primarily due to:
 a)
    
    improved operational efficiencies on lighting installations; andb)
    
    the recognition of revenue from a consulting services contract in the first quarter of fiscal
2006, that had no current year costs and expenses.
  (3)
    
    In the current year, fiscal 2006, costs and expenses on a dollar basis from continuing
operations decreased $355,000 or 8%, compared to the same period of fiscal 2005, primarily due to:
 a)
    
    the absence of lease costs of $115,000 in fiscal 2006 as the result of the sale of the Companys
former leaseback interest in a shopping center located in Minneapolis, Minnesota, in September
2004; andb)
    
    a decrease in depreciation expense of approximately $150,000 primarily related to one of the
Companys owned shopping centers which was fully depreciated as of fiscal 2006.
  18




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##### Table of Contents



PART II (continued)
    
 CHART C
 Percent ofSegment Revenuesfrom ContinuingOperations forYears EndedYears Ended April 30,
    
    April 30,2006
    
    
    2005
    
    2004
    
    2006
    
    
    2005
    
    2004Energy and Facilities Solutions(1)
    
    $
    2,234
    
    
    
    $
    2,194
    
    
    $
    2,424
    
    
    
    60
    
    
    
    
    63
    
    
    
    82Energy Services(2)
    
    
    2,183
    
    
    
    
    2,221
    
    
    
    788
    
    
    
    28
    
    
    
    
    23
    
    
    
    30Real Estate(3)
    
    
    976
    
    
    
    
    1,401
    
    
    
    863
    
    
    
    15
    
    
    
    
    17
    
    
    
    13Parent(4)
    
    
    3,297
    
    
    
    
    3,516
    
    
    
    2,526
    
    
    
    18
    
    
    
    
    16
    
    
    
    21Total
    
    $
    8,690
    
    
    
    $
    9,332
    
    
    $
    6,601
    
    
    
    48
    
    
    
    
    43
    
    
    
    54
 (1)
    
    In the prior year, fiscal 2005, compared to the same period in fiscal 2004, SG&A expenses
on a dollar basis and percentage basis, decreased approximately $230,000 or 9%, primarily due to:
 a)
    
    a one-time expense of approximately $267,000 in fiscal 2004, related to a change in the
estimated useful life of one of the
Companys proprietary facility management software applications;b)
    
    a decrease in rent expense of
approximately $131,000 related to the Energy Facilities and Solutions Segment moving its main
offices to the Companys corporate headquarters;partially offset by:c)
    
    an increase in bad debt expense related to one customer of approximately $50,000; andd)
    
    an increase in personnel and personnel related costs of approximately $43,000.
 (2)
    
    The Energy Services Segment was formed in December 2003, and therefore, a comparison between
fiscal 2005 and 2004 would not be meaningful.(3)
    
    In the current year, fiscal 2006, SG&A expenses on a dollar and percentage basis were $425,000
or 30% lower, compared to the same period of fiscal 2005, primarily due to the legal costs and net
settlement costs that were incurred in fiscal 2005, related to the conclusion of arbitration
proceedings.In the prior year, fiscal 2005, compared to the same period in fiscal 2004, SG&A expenses from
continuing operations increased $538,000 or 62%, primarily due to:
 a)
    
    an increase in personnel and personnel related costs of $138,000; andb)
    
    an increase of $326,000 related to the legal fees and net settlement costs that resulted from
the conclusion of an arbitration matter involving the Companys former asset manager in December
2004.
 (4)
    
    In the current year, fiscal 2006, SG&A expenses on a dollar basis decreased $219,000 or 6%,
compared to the same period in 2005, primarily due to lower incentive compensation tied to the
achievement of Company-wide earnings and performance goals in fiscal 2006.In the prior year, fiscal 2005, SG&A expenses were lower on a percentage basis, compared to the
same period in 2004, primarily due to the increase in consolidated revenues. In the prior year,
fiscal 2005, SG&A expenses on a dollar basis increased $990,000 or 39%, compared to the same period
in 2004, primarily due to:
 a)
    
    an increase in incentive compensation of approximately $892,000 tied to the successful
achievement of Company-wide earnings and performance goals;
 19




---



##### Table of Contents



b)
    
    an increase in personnel and other personnel related costs of approximately $107,000;c)
    
    costs of approximately $222,000 that were previously incurred among the operating
segments, but are now aggregated at the Parent as a result of the restructuring in fiscal
2005 of formerly separate accounting functions to a consolidated shared services
accounting platform for all operating segments. The majority of these costs were
previously expensed at the former Construction Segment; andd)
    
    an increase of approximately $94,000 in consulting fees related to
the Sarbanes-Oxley Act of 2002; partially offset by:e)
    
    a decrease in legal and tax professional fees of approximately $111,000.
   As
    
    DiscontinuedRevenues
    

Reported(1)
    
    Operations
    
    Combined2006
    
    $
    18,689,728
    
    
    $
    6,053,459
    
    
    $
    24,743,1872005
    
    
    21,631,570
    
    
    
    13,041,952
    
    
    
    34,673,5222004
    
    
    12,325,556
    
    
    
    51,121,600
    
    
    
    63,447,1562003
    
    
    10,523,063
    
    
    
    77,601,457
    
    
    
    88,124,5202002
    
    
    10,968,909
    
    
    
    109,405,527
    
    
    
    120,374,4362001
    
    
    154,606,987
    
    
    
    299,847
    
    
    
    154,906,8342000
    
    
    174,579,492
    
    
    
    11,864,725
    
    
    
    186,444,2171999
    
    
    172,201,090
    
    
    
    12,567,350
    
    
    
    184,768,440
 As
    
    DiscontinuedCosts and Expenses
    

Reported(1)
    
    Operations
    
    Combined2006
    
    $
    10,670,851
    
    
    $
    4,873,975
    
    
    $
    15,544,8262005
    
    
    12,711,851
    
    
    
    8,087,656
    
    
    
    20,799,5072004
    
    
    7,720,445
    
    
    
    49,333,068
    
    
    
    57,053,5132003
    
    
    6,340,798
    
    
    
    72,532,887
    
    
    
    78,873,6852002
    
    
    7,373,396
    
    
    
    99,809,610
    
    
    
    107,183,0062001
    
    
    139,075,402
    
    
    
    
    
    
    
    139,075,4022000
    
    
    155,731,989
    
    
    
    11,721,592
    
    
    
    167,453,5811999
    
    
    157,525,283
    
    
    
    13,588,788
    
    
    
    171,114,071
 As
    
    DiscontinuedGross Profit Margin
    

Reported(1)
    
    Operations
    
    Combined2006
    
    
    42.91
    %
    
    
    19.48
    %
    
    
    37.18
    %2005
    
    
    41 .23
    %
    
    
    37.99
    %
    
    
    40.01
    %2004
    
    
    37.36
    %
    
    
    3.50
    %
    
    
    10.08
    %2003
    
    
    39.74
    %
    
    
    6.53
    %
    
    
    10.50
    %2002
    
    
    32.78
    %
    
    
    8.77
    %
    
    
    10.96
    %2001
    
    
    10.05
    %
    
    
    100.00
    %
    
    
    10.22
    %2000
    
    
    10.80
    %
    
    
    1.21
    %
    
    
    10.19
    %1999
    
    
    8.52
    %
    
    
    (8.13
    )%
    
    
    7.39
    %
 
 (1)
    
    Fiscal years 2006-2002 are as reported
in ITEM 6. SELECTED FINANCIAL DATA and fiscal years 2001-1999 are as reported in
the Form 10-K for the year in which it was filed with the Securities and Exchange Commission.
 20




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##### Table of Contents



PART
II (continued)
    Fiscal
2006
     Fiscal 2005
  Fiscal 2004
   Fiscal 2006
  Fiscal 2005
   21




---



##### Table of Contents



Fiscal 2004
       a)
    
    an increase in note receivables of approximately $510,000 largely related to services
performed on a consulting contract;b)
    
    cash payments of approximately $1,089,000 during fiscal 2006 related to the incentive
compensation generated by the successful achievement of fiscal 2005 Company-wide earnings
and performance goals in fiscal 2005; andc)
    
    current year losses from continuing operations of approximately $206,000.
  a)
    
    the release of approximately $8,272,000 in sales proceeds previously held in escrow for
the intended purpose of purchasing replacement properties to qualify the sales as Internal
Revenue Code Section 1031 federal tax deferred exchanges for the Companys former shopping
center located in Cincinnati, Ohio, which was sold in February 2005, and for the Companys
former shopping center located in Jackson, Michigan, which was sold in April 2005. The
Company ultimately did not purchase replacement properties with these proceeds;b)
    
    total proceeds of approximately $3,246,000 from three sales (two outlots in October
2005 and one 7.1 acre tract of land in April 2006) all located in North Fort Myers,
Florida, that were each sold at gains, and the sale of a 4.7 acre tract of land located in
Louisville, Kentucky, that was sold at a gain in December 2005;c)
    
    the proceeds from the maturity of a held-to-maturity
investment of $2,000,000;
 partially offset by:d)
    
    the deposit with a qualified intermediary of cash proceeds of approximately $3,660,000
from sales of real estate in order to qualify the sales for federal income tax deferrals
under the Internal Revenue Code Section 1031. In May 2006, the Company elected not to use a
portion of these proceeds related to the sale of the Companys former interest in a
leaseback property located in Bayonet Point, Florida, to purchase an income-producing
property, and as a result, approximately $419,000 in proceeds were released to the Company;e)
    
    additions to income-producing properties of approximately $724,000, primarily related
to tenant and building improvements; andf)
    
    additions to intangibles of approximately $867,000, primarily related to the software
development costs for one of the Companys new proprietary software solutions.
    22




---



##### Table of Contents



PART
II (continued)
 Secured Letter of Credit
  Repurchases of Common Stock
  Other Commitments and Contingencies
      Payments Due by PeriodLess Than
    
    
    
    
    
    
    
    
    
    More ThanContractual Obligations
    
    Total
    
    1 Year
    
    1-3 Years
    
    3-5 Years
    
    5 YearsMortgage notes payable(1)
    
    $
    26,988,632
    
    
    $
    2,394,470
    
    
    $
    9,416,353
    
    
    $
    2,952,080
    
    
    $
    12,225,729Operating leases(2)
    
    
    3,431,490
    
    
    
    832,776
    
    
    
    1,284,650
    
    
    
    818,026
    
    
    
    496,038Other long-term debt(3)
    
    
    2,360,005
    
    
    
    372,462
    
    
    
    552,718
    
    
    
    447,012
    
    
    
    987,813Long-term obligations
    
    
    1 26,000
    
    
    
    92,000
    
    
    
    34,000
    
    
    
    
    
    
    
    Total
    
    $
    32,906,127
    
    
    $
    3,691,708
    
    
    $
    11,287,721
    
    
    $
    4,217,118
    
    
    $
    13,709,580
 (1)
    
    Regularly scheduled principal amortization and interest payments and final payments due upon maturity. In
computing interest expense, the Company used the applicable contractual rate. All of the mortgage notes payable are
fixed rate debt instruments. The Companys liability for repayment of each of these mortgages is limited to its
interest in the respective mortgaged properties by exculpatory provisions.(2)
    
    Future minimum rental payments on
leaseback shopping centers and ground leases. The Companys liability for payment under each of the leases is
limited to its interest in the perspective leasebacks and ground leases.(3)
    
    In computing interest expense related
to variable rate debt, a coupon rate of 9.25% (prime rate at April 30, 2006, plus 1.5%) was used for all periods,
and for fixed rate debt, the applicable contractual rate was used for all periods.
    23




---



##### Table of Contents



REVENUE RECOGNITION
 Revenue Recognition.
  24




---



##### Table of Contents



PART II (continued)
   INCOME-PRODUCING PROPERTIES AND PROPERTY AND EQUIPMENT
   VALUATION OF GOODWILL AND OTHER INTANGIBLE ASSETS
  25




---



##### Table of Contents



INCOME TAXES
  DISCONTINUED OPERATIONS
 Accounting for the Impairment or Disposal of Long-Lived
Assets,
 RECENT ACCOUNTING PRONOUNCEMENTS
 Accounting for Stock-Based Compensation, Accounting for Stock Issued to Employees.
     26




---



##### Table of Contents



PART
II (continued)
 
    Expected Maturity DateFiscal Year Ending April 30(Dollars in Thousands)There-
    
    
    
    
    
    Estimated2007
    
    2008
    
    2009
    
    2010
    
    2011
    
    after
    
    Total
    
    Fair ValueFixed rate debt
    
    $
    1,167
    
    
    
    6,951
    
    
    
    634
    
    
    
    693
    
    
    
    809
    
    
    
    11,273
    
    
    $
    21,527
    
    
    $
    21,394Average interest rate
    
    
    7.3
    %
    
    
    7.4
    %
    
    
    7.9
    %
    
    
    7.9
    %
    
    
    7.8
    %
    
    
    6.9
    %Variable
rate debt(1)
    
    $
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    930
    
    
    $
    930
    
    
    $
    930
 (1)
    
    Interest on variable rate debt is based on prime rate plus 1.5%.  27




---



##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
    
 28




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##### Table of Contents



CONSOLIDATED BALANCE SHEETS
 April 30,2006
    
    
    2005ASSETSCURRENT ASSETS:Cash and cash equivalents (Note 3)
    
    $
    7,329,805
    
    
    
    $
    1,402,645Restricted cash (Note 3)
    
    
    718,594
    
    
    
    
    8,272,399Short-term investment
    
    
    
    
    
    
    
    2,000,000Receivables:Trade accounts and notes, net of allowance for doubtful accounts of $11,061 in
2006, and $61,301 in 2005
    
    
    889,798
    
    
    
    
    589,977Contracts,
net of allowance for doubtful accounts of $0 in 2006, and $8,500 in
2005, including retained amounts of $171,303 in 2006, and $163,104 in 2005 (Note
5)
    
    
    1,519,509
    
    
    
    
    2,061,273Assets of discontinued operations (Note 4)
    
    
     
    
    
    
    
    142,981Costs and earnings in excess of billings (Note 5)
    
    
    286,824
    
    
    
    
    312,781Notes receivable (Note 15)
    
    
    902,505
    
    
    
    
    Deferred income taxes (Note 10)
    
    
    622,927
    
    
    
    
    552,953Other (Note 2)
    
    
    966,454
    
    
    
    
    851,953Total current assets
    
    
    13,236,416
    
    
    
    
    16,186,962INCOME-PRODUCING PROPERTIES, net (Notes 6 and 8)
    
    
    20,724,917
    
    
    
    
    20,693,372PROPERTY AND
EQUIPMENT, net (Note 7)
    
    
    843,204
    
    
    
    
    836,227RESTRICTED CASH (Note 3)
    
    
    3,241,310
    
    
    
    
    ASSETS OF DISCONTINUED OPERATIONS (Note 4)
    
    
    
    
    
    
    
    4,174,138OTHER ASSETS:Real estate held for future development or sale
    
    
    1,925,427
    
    
    
    
    3,692,731Intangible assets, net (Note 17)
    
    
    3,109,376
    
    
    
    
    2,794,558Goodwill (Note 17)
    
    
    5,458,717
    
    
    
    
    5,458,717Other (Note 2)
    
    
    3,870,883
    
    
    
    
    3,230,467$
    52,410,256
    
    
    
    $
    57,067,172LIABILITIES AND SHAREHOLDERS EQUITYCURRENT LIABILITIES:Trade and subcontractors payables, including retained amounts of $20,988 in
2006, and $13,903 in 2005
    
    $
    705,647
    
    
    
    $
    885,824Accrued expenses
    
    
    2,028,196
    
    
    
    
    1,789,502Accrued incentive compensation
    
    
    471,619
    
    
    
    
    1,089,369Billings in excess of costs and earnings (Note 5)
    
    
    211,676
    
    
    
    
    526,512Liabilities of discontinued operations (Note 4)
    
    
    
    
    
    
    
    326,188Current maturities of long-term debt
    
    
    1,167,192
    
    
    
    
    1,119,365Total current liabilities
    
    
    4,584,330
    
    
    
    
    5,736,760DEFERRED INCOME TAXES (Note 10)
    
    
    3,710,599
    
    
    
    
    3,460,151LIABILITIES OF DISCONTINUED OPERATIONS (Note 4)
    
    
    
    
    
    
    
    2,831,091OTHER LIABILITIES
    
    
    1,879,037
    
    
    
    
    1,602,243MORTGAGE NOTES PAYABLE, less current maturities (Note 8)
    
    
    19,806,542
    
    
    
    
    20,736,098OTHER LONG-TERM DEBT, less current maturities (Note 9)
    
    
    1,483,000
    
    
    
    
    1,787,418Total liabilities
    
    
    31,463,508
    
    
    
    
    36,153,761COMMITMENTS AND CONTINGENCIES (Notes 8, 9, and 18)SHAREHOLDERS EQUITY:Common
stock, $1 par value; 5,000,000 shares authorized;
3,695,336 issued and 3,532,180 outstanding at April 30, 2006,
(including 335,203 shares issued on October 11, 2005, as a stock
dividend)
3,357,601 issued and 3,209,113 outstanding at April 30, 2005
    
    
    3,695,336
    
    
    
    
    3,357,601Additional paid-in capital
    
    
    4,803,133
    
    
    
    
    3,067,982Deferred stock compensation
    
    
    (4,420
    )
    
    
    
    (14,162
    )Retained earnings
    
    
    13,227,076
    
    
    
    
    15,186,932Treasury stock (common shares) of 163,156 in 2006 (including 14,238 shares
issued on October 11, 2005, as a stock dividend) and 148,488 in 2005
    
    
    (774,377
    )
    
    
    
    (684,942
    )Total shareholders equity
    
    
    20,946,748
    
    
    
    
    20,913,411$
    52,410,256
    
    
    
    $
    57,067,172
 See accompanying notes to consolidated financial statements.
 29




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##### Table of Contents



CONSOLIDATED STATEMENTS OF OPERATIONS
 Years Ended April 30,2006
    
    
    2005
    
    2004REVENUES:Energy and facilities solutions
    
    $
    3,743,835
    
    
    
    $
    3,486,980
    
    
    $
    2,962,308Energy services
    
    
    7,867,644
    
    
    
    
    9,587,875
    
    
    
    2,602,025Rental income
    
    
    6,570,976
    
    
    
    
    8,397,425
    
    
    
    6,630,536Interest
    
    
    181,984
    
    
    
    
    79,436
    
    
    
    8,264Other
    
    
    325,289
    
    
    
    
    79,854
    
    
    
    122,42318,689,728
    
    
    
    
    21,631,570
    
    
    
    12,325,556COSTS AND EXPENSES:Energy and facilities solutions
    
    
    2,030,787
    
    
    
    
    2,026,179
    
    
    
    1,629,687Energy services
    
    
    4,704,677
    
    
    
    
    6,395,380
    
    
    
    1,821,869Rental property operating expenses, excluding interest
    
    
    3,935,387
    
    
    
    
    4,290,292
    
    
    
    4,268,88910,670,851
    
    
    
    
    12,711,851
    
    
    
    7,720,445Selling, general and administrative expenses
    
    
    8,689,500
    
    
    
    
    9,331,313
    
    
    
    6,600,411Loss on extinguishment of debt
    
    
    
    
    
    
    
    218,071
    
    
    
    Interest costs incurred
    
    
    1,589,144
    
    
    
    
    1,812,494
    
    
    
    2,262,11620,949,495
    
    
    
    
    24,073,729
    
    
    
    16,582,972GAINS ON SALE OF REAL ESTATE (Note 16), net of costs of sales of
$1,895,697 in 2006, $324,379 in 2005, and $0 in 2004
    
    
    1,928,290
    
    
    
    
    190,621
    
    
    
    LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
    
    
    (331,477
    )
    
    
    
    (2,251,538
    )
    
    
    (4,257,416
    )INCOME TAX BENEFIT (Note 10):Current
    
    
    46,505
    
    
    
    
    
    
    
    
    Deferred
    
    
    (172,467
    )
    
    
    
    (862,964
    )
    
    
    (1,499,602
    )(125,962
    )
    
    
    
    (862,964
    )
    
    
    (1,499,602
    )LOSS FROM CONTINUING OPERATIONS
    
    
    (205,515
    )
    
    
    
    (1,388,574
    )
    
    
    (2,757,814
    )DISCONTINUED OPERATIONS (Note 4):Loss from discontinued operations, adjusted for applicable income
tax benefit of $77,397 in 2006, $212,026 in 2005, and $629,463 in
2004
    
    
    (126,277
    )
    
    
    
    (421,039
    )
    
    
    (1,554,235
    )Gains on sale of income-producing real estate, adjusted for
applicable income tax expense of $525,600 in 2006, $1,977,390 in
2005, and $1,510,307 in 2004
    
    
    857,558
    
    
    
    
    3,609,971
    
    
    
    2,461,923EARNINGS FROM DISCONTINUED OPERATIONS
    
    
    731,281
    
    
    
    
    3,188,932
    
    
    
    907,688NET EARNINGS (LOSS)
    
    $
    525,766
    
    
    
    $
    1,800,358
    
    
    $
    (1,850,126
    )NET EARNINGS (LOSS) PER SHARE (Note 13):From continuing operations  basic and diluted
    
    $
    (.06
    )
    
    
    $
    (.39
    )
    
    $
    (.84
    )From discontinued operations  basic and diluted
    
    
    .21
    
    
    
    
    .90
    
    
    
    .28Net earnings (loss) per share  basic and diluted
    
    $
    .15
    
    
    
    $
    .51
    
    
    $
    (.56
    )
 See accompanying notes to consolidated financial statements.
 30




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##### Table of Contents



CONSOLIDATED STATEMENTS OF SHAREHOLDERS EQUITY
 AdditionalCommon Stock
    
    Paid-in
    
    Deferred Stock
    
    Retained
    
    TreasuryShares
    
    Amount
    
    Capital
    
    Compensation
    
    Earnings
    
    Stock
    
    TotalBALANCES at April
30, 2003
    
    
    3,060,239
    
    
    $
    3,060,239
    
    
    $
    2,153,505
    
    
    $
    (16,598
    )
    
    $
    16,734,753
    
    
    $
    (673,947
    )
    
    $
    21,257,952Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,850,126
    )
    
    
    
    
    
    
    (1,850,126
    )Common stock
acquired
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Common stock issued
    
    
    267,389
    
    
    
    267,389
    
    
    
    810,369
    
    
    
    (41,700
    )
    
    
    
    
    
    
    
    
    
    
    1,036,058Stock compensation
expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    31,443
    
    
    
    
    
    
    
    (5,836
    )
    
    
    25,607Cash dividends
declared 
$.14 per share
(adjusted
for stock dividend)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (471,964
    )
    
    
    
    
    
    
    (471,964
    )BALANCES at April
30, 2004
    
    
    3,327,628
    
    
    
    3,327,628
    
    
    
    2,963,874
    
    
    
    (26,855
    )
    
    
    14,412,663
    
    
    
    (679,783
    )
    
    
    19,997,527Net earnings
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,800,358
    
    
    
    
    
    
    
    1,800,358Common stock
acquired
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Common stock issued
    
    
    29,973
    
    
    
    29,973
    
    
    
    104,108
    
    
    
    (39,175
    )
    
    
    
    
    
    
    
    
    
    
    94,906Stock compensation
expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    51,868
    
    
    
    
    
    
    
    (5,159
    )
    
    
    46,709Cash dividends
declared 
$.29 per share
(adjusted
for stock dividend)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,026,089
    )
    
    
    
    
    
    
    (1,026,089
    )BALANCES at April
30, 2005
    
    
    3,357,601
    
    
    
    3,357,601
    
    
    
    3,067,982
    
    
    
    (14,162
    )
    
    
    15,186,932
    
    
    
    (684,942
    )
    
    
    20,913,411Net earnings
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    525,766
    
    
    
    
    
    
    
    525,766Common stock issued
    
    
    1,800
    
    
    
    1,800
    
    
    
    6,660
    
    
    
    (8,460
    )
    
    
    
    
    
    
    
    
    
    
    Stock compensation
expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    18,202
    
    
    
    
    
    
    
    (1,871
    )
    
    
    16,331Stock option
exercise
    
    
    732
    
    
    
    732
    
    
    
    2,196
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,928Cash dividends
declared
$.14 per share
(adjusted
for stock dividend)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (511,688
    )
    
    
    
    
    
    
    (511,688
    )Stock dividend
declared 
10% at market value
on
date declared
    
    
    335,203
    
    
    
    335,203
    
    
    
    1,726,295
    
    
    
    
    
    
    
    (1,973,934
    )
    
    
    (87,564
    )
    
    
    BALANCES at April
30, 2006
    
    
    3,695,336
    
    
    $
    3,695,336
    
    
    $
    4,803,133
    
    
    $
    (4,420
    )
    
    $
    13,227,076
    
    
    $
    (774,377
    )
    
    $
    20,946,748
 See accompanying notes to consolidated financial statements.
 31




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##### Table of Contents



CONSOLIDATED STATEMENTS OF CASH FLOWS
 Fiscal Year Ended2006
    
    
    2005
    
    2004Cash flows from operating activities:Net earnings
(loss)
    
    $
    525,766
    
    
    
    $
    1,800,358
    
    
    $
    (1,850,126
    )Earnings from discontinued operations, net of tax
    
    
    (731,281
    )
    
    
    
    (3,188,932
    )
    
    
    (907,688
    )Adjustments to reconcile net earnings (loss) to net
cash (used in) provided by operating activities:Gains on sale of real estate
    
    
    (1,928,291
    )
    
    
    
    (190,621
    )
    
    
    Depreciation and amortization
    
    
    1,376,378
    
    
    
    
    1,622,494
    
    
    
    1,739,225Deferred tax expense (benefit)
    
    
    180,474
    
    
    
    
    853,058
    
    
    
    (2,370,942
    )(Recovery of) provision for doubtful accounts, net
    
    
    (58,740
    )
    
    
    
    21,289
    
    
    
    15,893Loss on disposal of property & equipment
    
    
    17,232
    
    
    
    
    
    
    
    
    Loss on early extinguishment of debt
    
    
    
    
    
    
    
    218,071
    
    
    
    Changes in assets and liabilities, net of effect of acquisitions:Receivables, net
    
    
    301,463
    
    
    
    
    (959,098
    )
    
    
    10,643Notes receivable, net
    
    
    (509,568
    )
    
    
    
    
    
    
    
    Costs and earnings in excess of billings
    
    
    25,957
    
    
    
    
    201,138
    
    
    
    (385,240
    )Other current assets
    
    
    (99,432
    )
    
    
    
    (274,687
    )
    
    
    (180,747
    )Other assets
    
    
    (199,394
    )
    
    
    
    (462,495
    )
    
    
    (306,145
    )Trade and subcontractors payable
    
    
    (182,750
    )
    
    
    
    196,831
    
    
    
    (111,593
    )Accrued expenses
    
    
    166,848
    
    
    
    
    (271,005
    )
    
    
    625,154Accrued incentive compensation
    
    
    (617,750
    )
    
    
    
    1,089,369
    
    
    
    Billings in excess of costs and earnings
    
    
    (314,836
    )
    
    
    
    428,073
    
    
    
    (157,281
    )Other liabilities
    
    
    (84,887
    )
    
    
    
    43,460
    
    
    
    217,609Net cash (used in) provided by operating activities
    
    
    (2,132,811
    )
    
    
    
    1,127,303
    
    
    
    (3,661,238
    )Cash flows from investing activities:Proceeds from sale of real estate temporarily held in escrow
    
    
    8,272,399
    
    
    
    
    
    
    
    
    Deposit of cash proceeds from sale of real estate temporarily
held in escrow
    
    
    (3,659,904
    )
    
    
    
    (8,272,399
    )
    
    
    Proceeds from maturity of held-to-maturity investment
    
    
    2,000,000
    
    
    
    
    200,000
    
    
    
    Purchase of held-to-maturity investments
    
    
    (300,000
    )
    
    
    
    
    
    
    
    (2,200,000
    )Proceeds from sale of real estate held for future sale or development
    
    
    3,245,595
    
    
    
    
    515,000
    
    
    
    Additions to real estate held for sale or future development
    
    
    
    
    
    
    
    
    
    
    
    (17,686
    )Additions to income-producing properties, net
    
    
    (724,333
    )
    
    
    
    (459,243
    )
    
    
    (129,778
    )Additions to property, equipment and other, net
    
    
    (202,910
    )
    
    
    
    (469,661
    )
    
    
    (126,896
    )Additions to intangible assets, net
    
    
    (866,753
    )
    
    
    
    (605,041
    )
    
    
    (23,153
    )Acquisition, net of cash acquired
    
    
    
    
    
    
    
    (169,624
    )
    
    
    (3,209,862
    )Repayments received on notes receivable
    
    
    
    
    
    
    
    
    
    
    
    66,147Net cash provided by (used in) investing activities
    
    
    7,764,094
    
    
    
    
    (9,260,968
    )
    
    
    (5,641,228
    )Cash flows from financing activities:Scheduled debt repayments
    
    
    (1,122,770
    )
    
    
    
    (913,762
    )
    
    
    (896,666
    )Mortgage principal payoff
    
    
    
    
    
    
    
    (1,974,042
    )
    
    
    Deferred loan costs paid
    
    
    
    
    
    
    
    (50,000
    )
    
    
    Cash dividends
    
    
    (511,688
    )
    
    
    
    (1,026,089
    )
    
    
    (471,964
    )Proceeds from exercise of stock options
    
    
    2,928
    
    
    
    
    
    
    
    
    Net cash used in financing activities
    
    
    (1,631,530
    )
    
    
    
    (3,963,893
    )
    
    
    (1,368,630
    )Cash flows from discontinued operations:Operating activities
    
    
    (546,526
    )
    
    
    
    2,128,652
    
    
    
    2,185,094Investing activities
    
    
    5,360,366
    
    
    
    
    8,118,366
    
    
    
    21,226,613Financing activities
    
    
    (2,886,433
    )
    
    
    
    (3,126,494
    )
    
    
    (11,518,571
    )Net cash provided by discontinued operations
    
    
    1,927,407
    
    
    
    
    7,120,524
    
    
    
    11,893,136Net increase (decrease) in cash and cash equivalents
    
    
    5,927,160
    
    
    
    
    (4,977,034
    )
    
    
    1,222,040Cash and cash equivalents at beginning of period
    
    
    1,402,645
    
    
    
    
    6,379,679
    
    
    
    5,157,639Cash and cash equivalents at end of period
    
    $
    7,329,805
    
    
    
    $
    1,402,645
    
    
    $
    6,379,679Supplemental disclosure of noncash financing activities:Issuance of common stock under 2000 Stock Award Plan
    
    $
    8,460
    
    
    
    $
    39,175
    
    
    $
    41,700Supplemental schedule of cash flow information:Cash paid during the year for interest
    
    $
    2,004,677
    
    
    
    $
    1,996,986
    
    
    $
    2,457,694Cash paid (refunded) during the year for income taxes, net
    
    $
    141,771
    
    
    
    $
    58,488
    
    
    $
    (186,094
    )
 See accompanying notes to consolidated financial statements.
 32




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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (A) PRINCIPLES OF CONSOLIDATION AND BASIS OF PRESENTATION
   (B) USE OF ESTIMATES
  (C) REVENUE RECOGNITION
 Revenue Recognition.
   33




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##### Table of Contents



(D) CASH AND CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS
  (E) RESTRICTED CASH
  (F) INCOME-PRODUCING PROPERTIES AND PROPERTY AND EQUIPMENT
   (G) REAL ESTATE HELD FOR FUTURE DEVELOPMENT OR SALE
  (H) DEFERRED LOAN COSTS
  (I) IMPAIRMENT OF LONG-LIVED ASSETS AND ASSETS TO BE DISPOSED OF
  34




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##### Table of Contents



NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
  (J) INCOME TAXES
  (K) CAPITALIZED COMPUTER SOFTWARE
 Accounting for the Costs of
Computer Software Developed or Obtained for Internal Use,
 (L) GOODWILL AND OTHER INTANGIBLE ASSETS
  Computer software
    
    3 yearsProprietary facility management software applications
    
    5 yearsCustomer relationships
    
    5 yearsLease costs
    
    Over the term of the leaseLoan costs
    
    Over the term of the loan
 Goodwill and Other Intangible
Assets,
 (M) DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
 Accounting for Derivative Instruments and Hedging Activities,
 (N) DISCONTINUED OPERATIONS
 Accounting for the Impairment or Disposal of Long-Lived Assets,
 35




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##### Table of Contents



(0) OTHER CURRENT ASSETS
  2006
    
    
    
    2005Inventory
    
    $
    253,330
    
    
    
    $
    313,813Prepaid real estate taxes
    
    
    207,858
    
    
    
    
    170,999Prepaid insurance
    
    
    138,512
    
    
    
    
    82,168Deferred costs
    
    
    123,273
    
    
    
    
    Prepaid rent
    
    
    78,624
    
    
    
    
    106,997Deposits
    
    
    25,320
    
    
    
    
    25,320Prepaid consulting
    
    
    25,000
    
    
    
    
    25,000Other
    
    
    114,537
    
    
    
    
    127,656$
    966,454
    
    
    
    $
    851,953
 (P) OTHER ASSETS
  2006
    
    
    
    2005Cash surrender value of life insurance
    
    $
    1,605,863
    
    
    
    $
    1,428,753Deferred compensation plans
    
    
    1,731,825
    
    
    
    
    1,370,144Straight-line rent
    
    
    452,638
    
    
    
    
    408,070Notes receivable
    
    
    80,563
    
    
    
    
    23,500$
    3,870,889
    
    
    
    $
    3,230,467
 (Q) RECENT ACCOUNTING PRONOUNCEMENT
 Accounting for
Stock-Based Compensation, Accounting for
Stock Issued to Employees.
 (R) STOCK COMPENSATION
   2006
    
    
    
    2005
    
    
    2004Net earnings (loss), as reported
    
    $
    525,766
    
    
    
    $
    1,800,358
    
    
    $
    (1,850,126
    )Add: Stock-based compensation
    
    
    25,107
    
    
    
    
    52,397
    
    
    
    25,607Deduct: Total stock-based compensation expense as determined
under fair value based method for all awards, net of related
tax effects
    
    
    (113,999
    )
    
    
    
    (161,600
    )
    
    
    (178,084
    )Add: Forfeitures, net of related tax effects
    
    
    12,124
    
    
    
    
    50,760
    
    
    
    127,936Pro forma net earnings (loss)
    
    $
    448,998
    
    
    
    $
    1,741,915
    
    
    $
    (1,874,667
    )Net earnings (loss) per share:Basic and diluted  as reported
    
    $
    0.15
    
    
    
    $
    0.51
    
    
    $
    (0.56
    )Basic and diluted  pro forma
    
    $
    0.13
    
    
    
    $
    0.49
    
    
    $
    (0.57
    )
  36




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##### Table of Contents



NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
  2006
    
    
    2005
    
    2004Weighted
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    WeightedOptions to
    
    Average
    
    
    Options to
    
    Average
    
    Options to
    
    AveragePurchase
    
    Exercise
    
    
    Purchase
    
    Exercise
    
    Purchase
    
    ExerciseShares
    
    Price
    
    
    Shares
    
    Price
    
    Shares
    
    PriceOutstanding at beginning of year
    
    
    788,169
    
    
    $
    4.67
    
    
    
    
    723,353
    
    
    $
    4.56
    
    
    
    816,077
    
    
    $
    4.44Granted
    
    
    4,400
    
    
    
    4.77
    
    
    
    
    172,589
    
    
    
    4.86
    
    
    
    182,600
    
    
    
    4.64Forfeited
    
    
    (34,373
    )
    
    
    4.57
    
    
    
    
    (107,773
    )
    
    
    4.68
    
    
    
    (275,324
    )
    
    
    4.07Exercised
    
    
    (806
    )
    
    
    3.64
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Outstanding at end of year
    
    
    757,390
    
    
    
    4.68
    
    
    
    
    788,169
    
    
    
    4.67
    
    
    
    723,353
    
    
    
    4.56Vested at end of year
    
    
    757,390
    
    
    $
    4.68
    
    
    
    
    498,593
    
    
    $
    4.61
    
    
    
    281,153
    
    
    $
    4.61
    Number of
    
    Weighted AverageOutstanding and
    
    Remaining ContractualExercise Price
    
    Exercisable Options
    
    Life (Years)$3.64
    
    
    4,029
    
    
    
    .05$4.64
    
    
    648,340
    
    
    
    5.19$4.77
    
    
    4,400
    
    
    
    9.15$4.82
    
    
    74,800
    
    
    
    0.09$5.45
    
    
    25,821
    
    
    
    8.14
  2006
    
    
    2005
    
    2004Expected life (years)
    
    
    10
    
    
    
    
    10
    
    
    
    10Dividend yield
    
    
    3.70
    %
    
    
    
    3.86
    %
    
    
    4.01
    %Expected stock price volatility
    
    
    26
    %
    
    
    
    26
    %
    
    
    32
    %Risk-free interest rate
    
    
    4.52
    %
    
    
    
    4.45
    %
    
    
    4.51
    %
    37




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##### Table of Contents



Accounting for the Impairment or Disposal of Long-Lived Assets,
 Allocation of Interest to Discontinued Operations.
 CONSTRUCTION SEGMENT
  REAL ESTATE SALES OF INCOME-PRODUCING PROPERTIES
   2006
    
    
    2005
    
    2004REVENUES:Construction
    
    $
    40
    
    
    
    $
    145,513
    
    
    $
    25,502,080Rental properties
    
    
    553,419
    
    
    
    
    1,896,439
    
    
    
    3,819,520Total revenues
    
    
    553,459
    
    
    
    
    2,041,952
    
    
    
    29,321,600COSTS AND EXPENSES:Construction costs and expenses
    
    
    150,411
    )
    
    
    
    114,734
    
    
    
    25,093,339Rental property operating expenses, including depreciation
    
    
    390,571
    
    
    
    
    1,271,428
    
    
    
    2,123,388Real Estate interest expense and loan prepayment fees
    
    
    319,983
    
    
    
    
    1,117,462
    
    
    
    675,182Construction selling, general & administrative
    
    
    96,990
    
    
    
    
    171,393
    
    
    
    3,613,389Total costs and expenses
    
    
    757,133
    
    
    
    
    2,675,017
    
    
    
    31,505,298Operating loss from discontinued operations
    
    
    (203,674
    )
    
    
    
    (633,065
    )
    
    
    (2,183,698
    )Income tax benefit
    
    
    (77,397
    )
    
    
    
    (212,026
    )
    
    
    (629,463
    )Operating loss from discontinued operations, net of tax
    
    
    (126,277
    )
    
    
    
    (421 ,039
    )
    
    
    (1,554,235
    )Gains on sale of income-producing real estate
    
    
    1,383,158
    
    
    
    
    5,587,361
    
    
    
    3,972,230Income tax expense
    
    
    525,600
    
    
    
    
    1,977,390
    
    
    
    1,510,307Gains on sale of income-producing real estate, net of tax
    
    
    857,558
    
    
    
    
    3,609,971
    
    
    
    2,461,923Earnings from discontinued operations, net of tax
    
    $
    731,281
    
    
    
    $
    3,188,932
    
    
    $
    907,688
 38




---



##### Table of Contents



NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
 Balances atAssets of Discontinued Operations
    
    April 30, 2006
    
    
    April 30, 2005Receivables
    
    $
    
    
    
    
    $
    101,257Other current assets
    
    
    
    
    
    
    
    41,724Income-producing properties
    
    
    
    
    
    
    
    3,720,273Intangible assets
    
    
    
    
    
    
    
    369,714Other assets
    
    
    
    
    
    
    
    84,151$
    
    
    
    
    $
    4,317,119
 Balances atLiabilities of Discontinued Operations
    
    April 30, 2006
    
    
    April 30, 2005Trade and subcontractors payables
    
    $
    
    
    
    
    $
    76,723Accrued expenses
    
    
    Current maturities of long-term debt
    
    
    
    
    
    
    
    55,342Mortgage notes payable
    
    
    
    
    
    
    
    2,831,091$
    
    
    
    
    $
    3,157,279
   2006
    
    
    2005Costs and earnings in excess of billings:Accumulated costs and earnings
    
    $
    1,377,857
    
    
    
    $
    411,692Amounts billed
    
    
    1,091,033
    
    
    
    
    98,911$
    286,824
    
    
    
    $
    312,781Billings in excess of costs and earnings:Amounts billed
    
    $
    2,837,690
    
    
    
    $
    5,208,720Accumulated costs and earnings
    
    
    2,626,014
    
    
    
    
    4,682,208$
    211,676
    
    
    
    $
    526,512
   EstimatedUseful Lives
    
    2006
    
    
    2005Land
    
    
    N/A
    
    
    $
    6,347,719
    
    
    
    $
    6,347,719Buildings and improvements
    
    7-39 years
    
    
    24,604,506
    
    
    
    
    24,089,130$
    30,952,225
    
    
    
    $
    30,436,849Less  accumulated depreciation and amortization
    
    
    
    
    
    
    10,227,308
    
    
    
    
    9,743,477$
    20,724,917
    
    
    
    $
    20,693,372
    EstimatedUseful Lives
    
    2006
    
    
    2005Building and tenant improvements
    
    3-39 years
    
    $
    490,804
    
    
    
    $
    531,983Furniture, Fixtures and Equipment
    
    3-10 years
    
    
    1,231,543
    
    
    
    
    1,054,656Vehicles
    
    3-5 years
    
    
    147,126
    
    
    
    
    150,501$
    1,869,473
    
    
    
    $
    1,737,140Less  accumulated depreciation
    
    
    
    
    
    
    1,026,269
    
    
    
    
    900,913$
    843,204
    
    
    
    $
    836,227
 39




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##### Table of Contents



Year Ending April 30,
    
    Owned
    
    
    Leaseback2007
    
    $
    4,145,000
    
    
    $
    1,123,0002008
    
    
    3,544,000
    
    
    
    1,017,0002009
    
    
    2,067,000
    
    
    
    868,0002010
    
    
    1,716,000
    
    
    
    743,0002011
    
    
    1,245,000
    
    
    
    567,000Thereafter
    
    
    2,855,000
    
    
    
    1,002,000$
    15,572,000
    
    
    $
    5,320,000
  Owned Rental Properties
    
    
    LeasebackMortgage Payments
    
    
    Centers RentalYear Ending April 30,
    
    Principal
    
    
    Interest
    
    
    Payments2007
    
    $
    930,150
    
    
    $
    1,464,320
    
    
    $
    833,0002008
    
    
    6,672,627
    
    
    
    1,249,943
    
    
    
    682,0002009
    
    
    593,929
    
    
    
    899,854
    
    
    
    602,0002010
    
    
    608,140
    
    
    
    852,886
    
    
    
    449,0002011
    
    
    658,930
    
    
    
    832,124
    
    
    
    369,000Thereafter
    
    
    11,272,916
    
    
    
    952,813
    
    
    
    496,000$
    20,736,692
    
    
    $
    6,251,940
    
    
    $
    3,431,000
  40




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##### Table of Contents



NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
 SECURED LETTER OF CREDIT
  DEBT RESTRUCTURING IN FISCAL 2005
     2006
    
    
    
    2005Note payable, net of discount ($70,000 at April 30, 2006), bearing
interest at the prime rate plus 1.5% (9.25% at April 30, 2006); interest only
payments due monthly; matures December 18, 2011; secured by all general assets
of The Wheatstone Energy Group, LLC
    
    $
    930,000
    
    
    
    $
    1,000,000Note payable bearing interest at 6.0%; interest due annually on January
31, and principal payments due in installments as defined in the agreement
commencing on January 31, 2006; matures on January 31, 2008
    
    
    387,000
    
    
    
    
    516,000Note payable bearing interest at 6.8%; interest due annually on December
31, beginning December 31, 2004, and principal payments due annually in
installments as defined in the agreement commencing on December 19, 2008;
matures on December 19, 2011
    
    
    295,000
    
    
    
    
    295,000Note payable, net of discount ($4,875 at April 30, 2006), with an imputed
interest rate of 6.0%; principal payments due in two installments on May 26,
2005, and May 26, 2006
    
    
    74,625
    
    
    
    
    144,750Note payable, net of discount ($1,749 at April 30, 2006), with an imputed
interest rate of 6.0%; principal payments due annually in installments as
defined in the agreement, commencing on December 26, 2004; matures on December
26, 2006
    
    
    33,417
    
    
    
    
    61,668Capital lease obligation; monthly payments of $3,578 through July 2005
    
    
    
    
    
    
    
    10,557Various notes payables with interest rates ranging from 8.3% to 10.75%;
maturity dates ranging from September 2005 to November 2005
    
    
    
    
    
    
    
    16,989Total other long-term debt
    
    
    1,720,042
    
    
    
    
    2,044,964Less current maturities
    
    
    237,042
    
    
    
    
    257,546Total other long-term debt, less current maturities
    
    $
    1,483,000
    
    
    
    $
    1,787,418
  Fiscal Year Ending April 30,2007
    
    $
    237,0422008
    
    
    278,0002009
    
    
    40,0002010
    
    
    85,0002011
    
    
    150,000Thereafter
    
    
    930,000Total
    
    $
    1,720,042
 41




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##### Table of Contents



Current
    
    
    Deferred
    
    
    TotalYear ended April 30, 2006Federal
    
    $
    46,505
    
    
    $
    (152,578
    )
    
    $
    (106,073
    )State and local
    
    
    
    
    
    
    (19,889
    )
    
    
    (19,889
    )$
    46,505
    
    
    $
    (172,467
    )
    
    $
    (125,962
    )Year ended April 30, 2005Federal
    
    $
    
    
    
    $
    (730,157
    )
    
    $
    (730,157
    )State and local
    
    
    
    
    
    
    (132,807
    )
    
    
    (132,807
    )$
    
    
    
    $
    (862,964
    )
    
    $
    (862,964
    )Year ended April 30, 2004Federal
    
    $
    
    
    
    $
    (1,262,823
    )
    
    $
    (1,262,823
    )State and local
    
    
    
    
    
    
    (236,779
    )
    
    
    (236,779
    )$
    
    
    
    $
    (1,499,602
    )
    
    $
    (1,499,602
    )
  2006
    
    
    
    2005
    
    
    2004Computed expected tax benefit
    
    $
    (112,702
    )
    
    
    $
    (765,523
    )
    
    $
    (1,447,521
    )Decrease in income taxes resulting from:State and local income taxes, net of federal income tax benefit
    
    
    (13,260
    )
    
    
    
    (90,062
    )
    
    
    (170,297
    )Valuation allowance
    
    
    
    
    
    
    
    (46,667
    )
    
    
    282,045Other
    
    
    
    
    
    
    
    39,288
    
    
    
    (163,829
    )$
    (125,962
    )
    
    
    $
    (862,964
    )
    
    $
    (1,499,602
    )
  2006
    
    
    
    2005Deferred income tax assets:Items not currently deductible for tax purposes:Net operating loss carryforwards, federal and state(1)
    
    $
    1,451,135
    
    
    
    $
    2,335,982Valuation allowance
    
    
    (236,098
    )
    
    
    
    (236,098
    )Income producing properties and property and equipment, principally
because of differences in depreciation and capitalized interest
    
    
    842,202
    
    
    
    
    893,838Capitalized costs
    
    
    86,881
    
    
    
    
    96,003Accrued directors fees
    
    
    187,899
    
    
    
    
    166,480Bad debt reserve
    
    
    32,592
    
    
    
    
    62,889Deferred compensation plan
    
    
    467,184
    
    
    
    
    439,286Compensated absences
    
    
    52,121
    
    
    
    
    56,876Other accrued expenses
    
    
    425,981
    
    
    
    
    460,279Other
    
    
    329,306
    
    
    
    
    378,874Gross deferred income tax assets
    
    
    3,639,203
    
    
    
    
    4,654,409Deferred income tax liabilities:Income producing properties and property and equipment, principally
because of differences in depreciation and capitalized interest
    
    
    944,959
    
    
    
    
    778,165Gain on real estate sales structured as tax-deferred like-kind exchanges
    
    
    5,605,180
    
    
    
    
    6,594,993Other
    
    
    176,736
    
    
    
    
    188,449Gross deferred income tax liability
    
    $
    6,726,875
    
    
    
    $
    7,561,607Net deferred income tax liability
    
    $
    3,087,672
    
    
    
    $
    2,907,198
 (1)
    
    The federal net operating loss carryforwards expire in various years beginning after
fiscal 2015. The majority of the state operating loss carryforwards expire in various years
beginning after fiscal 2009.
  42




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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
           43




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##### Table of Contents



For the Year Ended April 30, 2006Earnings (Loss)
    
    
    Shares
    
    
    Per Share(Numerator)
    
    
    (Denominator)
    
    
    AmountBasic EPSloss from continuing operations
    
    $
    (205,515
    )
    
    
    3,531,089
    
    
    $
    (0.06
    )Basic EPSearnings from discontinued operations
    
    
    731,281
    
    
    
    3,531,089
    
    
    
    0.21Effect of dilutive securities
    
    
    Diluted EPSnet earnings
    
    $
    525,766
    
    
    
    3,531,089
    
    
    $
    0.15
 For the Year Ended April 30, 2005Earnings (Loss)
    
    
    Shares
    
    
    Per Share(Numerator)
    
    
    (Denominator)
    
    
    AmountBasic EPSloss from continuing operations
    
    $
    (1,388,574
    )
    
    
    3,526,041
    
    
    $
    (0.39
    )Basic EPSearnings from discontinued operations
    
    
    3,188,932
    
    
    
    3,526,041
    
    
    
    0.90Effect of dilutive securities
    
    
    
    
    
    
    
    
    
    
    Diluted EPSnet earnings
    
    $
    1,800,358
    
    
    
    3,526,041
    
    
    $
    0.51
 For the Year Ended April 30, 2004Earnings (Loss)
    
    
    Shares
    
    
    Per Share(Numerator)
    
    
    (Denominator)
    
    
    AmountBasic EPSloss from continuing operations
    
    $
    (2,757,814
    )
    
    
    3,292,137
    
    
    $
    (0.84
    )Basic EPSearnings from discontinued operations
    
    
    907,688
    
    
    
    3,292,137
    
    
    
    0.28Effect of dilutive securities
    
    
    
    
    
    
    
    
    
    
    Diluted EPSnet loss
    
    $
    (1,850,126
    )
    
    
    3,292,137
    
    
    $
    (0.56
    )
  ® ® ® ® ® ® ®
  44




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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
   Fiscal
    
    Fiscal
    
    Fiscal2006
    
    2005
    
    2004The Kmart Corporation
    
    
    13
    %
    
    
    21
    %
    
    
    24
    %Customer 2
    
    NA
    
    
    13
    
    
    NACustomer 3
    
    NA
    
    
    11
    
    
    NA
    Energyand Facilities
    
    
    Energy
    
    
    RealSolutions
    
    
    Services(1)
    
    
    Estate(2)
    
    
    Parent
    
    
    Eliminations
    
    
    Consolidated2006Revenues from unaffiliated
customers
    
    $
    3,743,835
    
    
    $
    7,867,644
    
    
    $
    10,394,963
    
    
    $
    
    
    
    $
    
    
    
    $
    22,006,442Interest and other income
    
    
    1,486
    
    
    
    28,141
    
    
    
    1,083,364
    
    
    
    34,424
    
    
    
    (640,142
    )
    
    
    507,273Intersegment revenue
    
    
    
    
    
    
    
    
    
    
    517,197
    
    
    
    
    
    
    
    (517,197
    )
    
    
    Total revenues
    
    $
    3,745,321
    
    
    $
    7,895,785
    
    
    $
    11,995,524
    
    
    $
    34,424
    
    
    $
    (1,157,339
    )
    
    $
    22,513,715Net earnings (loss)
    
    $
    (562,801
    )
    
    $
    326,149
    
    
    $
    3,150,288
    
    
    $
    (3,058,031
    )
    
    $
    690,248
    
    
    $
    545,853Segment assets
    
    $
    7,107,180
    
    
    $
    6,850,033
    
    
    $
    45,230,775
    
    
    $
    28,987,785
    
    
    $
    (35,765,517
    )
    
    $
    52,410,256Goodwill(3)
    
    $
    2,286,901
    
    
    $
    3,171,816
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    5,458,717Interest expense(3)
    
    $
    4,776
    
    
    $
    81,512
    
    
    $
    1,527,855
    
    
    $
    615,343
    
    
    $
    (640,142
    )
    
    $
    1,589,144Depreciation and amortization(3)
    
    $
    349,612
    
    
    $
    66,203
    
    
    $
    875,362
    
    
    $
    85,201
    
    
    $
    
    
    
    $
    1,376,378Capital expenditures(3)
    
    $
    90,903
    
    
    $
    44,381
    
    
    $
    745,376
    
    
    $
    46,583
    
    
    $
    
    
    
    $
    927,243
 Energy andFacilities
    
    
    Energy
    
    
    RealSolutions
    
    
    Services(1)
    
    
    Estate(2)
    
    
    Parent
    
    
    Eliminations
    
    
    Consolidated2005Revenues from unaffiliated
customers
    
    $
    3,486,980
    
    
    $
    9,587,875
    
    
    $
    8,912,425
    
    
    $
    
    
    
    $
    
    
    
    $
    21,987,280Interest and other income
    
    
    
    
    
    
    17,615
    
    
    
    350,064
    
    
    
    29,781
    
    
    
    (238,170
    )
    
    
    159,290Intersegment revenue
    
    
    14,867
    
    
    
    
    
    
    
    500,736
    
    
    
    
    
    
    
    (515,603
    )
    
    
    Total revenues
    
    $
    3,501,847
    
    
    $
    9,605,490
    
    
    $
    9,763,225
    
    
    $
    29,781
    
    
    $
    (753,773
    )
    
    $
    22,146,570Net earnings (loss)
    
    $
    (570,909
    )
    
    $
    294,505
    
    
    $
    4,030,540
    
    
    $
    (2,832,509
    )
    
    $
    963,847
    
    
    $
    1,885,474Segment assets
    
    $
    4,825,361
    
    
    $
    7,015,713
    
    
    $
    45,976,925
    
    
    $
    22,153,647
    
    
    $
    (22,904,474
    )
    
    $
    57,067,172Goodwill(3)
    
    $
    2,286,901
    
    
    $
    3,171,816
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    5,458,717Interest expense(3)
    
    $
    8,222
    
    
    $
    144,186
    
    
    $
    1,680,119
    
    
    $
    215,695
    
    
    $
    (235,728
    )
    
    $
    1,812,494Depreciation and amortization(3)
    
    $
    342,887
    
    
    $
    127,138
    
    
    $
    1,014,464
    
    
    $
    138,080
    
    
    $
    
    
    
    $
    1,622,569Capital expenditures(3)
    
    $
    76,984
    
    
    $
    55,289
    
    
    $
    459,243
    
    
    $
    337,388
    
    
    $
    
    
    
    $
    928,904
 45




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##### Table of Contents



Energy andFacilities
    
    
    Energy
    
    
    RealSolutions
    
    
    Services(1)
    
    
    Estate(2)
    
    
    Parent
    
    
    Eliminations
    
    
    Consolidated2004Revenues from unaffiliated
customers
    
    $
    2,962,308
    
    
    $
    2,602,025
    
    
    $
    6,630,536
    
    
    $
    
    
    
    $
    
    
    
    $
    12,194,869Interest and other income
    
    
    
    
    
    
    13,445
    
    
    
    89,457
    
    
    
    27,785
    
    
    
    
    
    
    
    130,687Intersegment revenue
    
    
    13,600
    
    
    
    32,044
    
    
    
    470,008
    
    
    
    3,076
    
    
    
    (518,728
    )
    
    
    Total revenues
    
    $
    2,975,908
    
    
    $
    2,647,514
    
    
    $
    7,190,001
    
    
    $
    30,861
    
    
    $
    (518,728
    )
    
    $
    12,325,556Net earnings
(loss)
    
    $
    (677,062
    )
    
    $
    (39,621
    )
    
    $
    2,836,016
    
    
    $
    (2,530,192
    )
    
    $
    745,104
    
    
    $
    334,245Segment assets
    
    $
    4,842,959
    
    
    $
    5,746,891
    
    
    $
    45,935,012
    
    
    $
    27,401,519
    
    
    $
    (22,050,362
    )
    
    $
    61,876,019Goodwill(3)
    
    $
    1,963,248
    
    
    $
    3,034,994
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    4,998,242Interest expense(3)
    
    $
    1,491
    
    
    $
    44,750
    
    
    $
    2,198,330
    
    
    $
    17,545
    
    
    $
    
    
    
    $
    2,262,116Depreciation and amortization(3)
    
    $
    497,179
    
    
    $
    45,374
    
    
    $
    1,049,482
    
    
    $
    147,190
    
    
    $
    
    
    
    $
    1,739,225Capital expenditures(3)
    
    $
    18,233
    
    
    $
    9,282
    
    
    $
    129,778
    
    
    $
    99,381
    
    
    $
    
    
    
    $
    256,674
 (1)
    
    The Energy Services Segment was formed in December 2003.(2)
    
    The Company is in the business of creating long-term value by periodically realizing gains
through the sale of income-producing properties and the sale of real estate held for future
development or sale and, therefore, the Real Estate Segments net earnings includes earnings from
discontinued operations, pursuant to SFAS 144, that resulted from the sales of certain
income-producing properties and the revenues and earnings in continuing operations that resulted
from the gain on sale of other real estate assets.(3)
    
    Does not include amounts associated with discontinued operations.
  For the Year Ended April 30,2006
    
    
    
    2005
    
    
    2004Consolidated segment revenues
    
    $
    22,513,715
    
    
    
    $
    22,146,570
    
    
    $
    12,325,556Revenues on sale of real estate held for sale
    
    
    (3,823,987
    )
    
    
    
    (515,000
    )
    
    
    Total consolidated revenues
    
    $
    18,689,728
    
    
    
    $
    21,631,570
    
    
    $
    12,325,556
  For the Year Ended April 30,2006
    
    
    
    2005
    
    
    2004Consolidated Segment net earnings
    
    $
    545,853
    
    
    
    $
    1,885,474
    
    
    $
    334,245Discontinued Construction Segment net loss
    
    
    (20,087
    )
    
    
    
    (170,761
    )
    
    
    (3,177,382
    )Eliminations related to Construction Segment
    
    
    
    
    
    
    
    85,645
    
    
    
    993,011Total consolidated net earnings (loss)
    
    $
    525,766
    
    
    
    $
    1,800,358
    
    
    $
    (1,850,126
    )
  Fiscal 2006
  Fiscal 2005
   46




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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
 Fiscal 2004
      2005
    
    
    2004BPE
    
    
    ITEN
    
    
    Prestley Mill
    
    
    TWEG
    
    
    Estimated Useful LifeCurrent assets
    
    $
    
    
    
    $
    64,599
    
    
    $
    
    
    
    $
    933,982Property, furniture and equipment
    
    
    8,727
    
    
    
    22,560
    
    
    
    
    
    
    
    253,493
    
    
    Various (25 years)Land
    
    
    
    
    
    
    
    
    
    
    609,000
    
    
    
    
    
    
    IndefiniteBuilding
    
    
    
    
    
    
    
    
    
    
    2,555,975
    
    
    
    
    
    
    39 yearsTenant improvements
    
    
    
    
    
    
    
    
    
    
    725,592
    
    
    
    
    
    
    Over life of leaseLease costs
    
    
    
    
    
    
    
    
    
    
    470,833
    
    
    
    
    
    
    Over life of leaseCustomer relationships
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    218,000
    
    
    5 yearsTrademarks
    
    
    
    
    
    
    106,399
    
    
    
    
    
    
    
    280,000
    
    
    IndefiniteNon-compete agreements
    
    
    16,222
    
    
    
    7,247
    
    
    
    
    
    
    
    3,000
    
    
    2 yearsComputer software
    
    
    
    
    
    
    854,879
    
    
    
    
    
    
    
    42,438
    
    
    35 yearsGoodwill
    
    
    313,035
    
    
    
    228,240
    
    
    
    
    
    
    
    3,171,816
    
    
    IndefiniteTotal assets acquired
    
    
    337,984
    
    
    
    1,283,924
    
    
    
    4,361,400
    
    
    
    4,902,729Current liabilities
    
    
    
    
    
    
    174,136
    
    
    
    
    
    
    
    1,032,404Debt
    
    
    
    
    
    
    
    
    
    
    2,941,469
    
    
    
    1,890,000Total liabilities assumed
    
    
    
    
    
    
    174,136
    
    
    
    2,941,469
    
    
    
    2,922,404Net assets acquired
    
    $
    337,984
    
    
    $
    1,109,788
    
    
    $
    1,419,931
    
    
    $
    1,980,325
   Fiscal 2006
  47




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##### Table of Contents



Fiscal 2005
    48




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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
  Fiscal 2004
    April 30, 2006Gross Carrying
    
    
    AccumulatedAmortized intangible assets:
    
    Amount
    
    
    AmortizationProprietary facility management software applications
    
    $
    2,464,564
    
    
    $
    867,130Computer software
    
    
    427,210
    
    
    
    401,825Real estate lease costs
    
    
    1,150,800
    
    
    
    709,327Customer relationships
    
    
    218,000
    
    
    
    101,733Deferred loan costs
    
    
    751,547
    
    
    
    546,441Other
    
    
    55,609
    
    
    
    40,605$
    5,067,730
    
    
    $
    2,667,061Unamortized intangible assets:Trademark
    
    $
    708,707
    
    
    $
    
 April 30, 2005Gross Carrying
    
    
    AccumulatedAmortized intangible assets:
    
    Amount
    
    
    AmortizationProprietary facility management software applications
    
    $
    1,698,896
    
    
    $
    590,042Computer software
    
    
    409,197
    
    
    
    364,127Real estate lease costs
    
    
    1,105,117
    
    
    
    617,762Customer relationships
    
    
    218,000
    
    
    
    58,133Deferred loan costs
    
    
    751,547
    
    
    
    505,125Other
    
    
    55,609
    
    
    
    17,326$
    4,238,366
    
    
    $
    2,152,515Unamortized intangible assets:Trademark
    
    $
    708,707
    
    
    $
    Aggregate amortization expense for all amortized intangible assetsFor the year ended April 30, 2006
    
    
    
    
    
    $
    553,669For the year ended April 30, 2005
    
    
    
    
    
    
    561,029For the year ended April 30, 2004
    
    
    
    
    
    
    416,893Estimated amortization expense for all amortized intangible assets for the fiscal years endedApril 30, 2007
    
    
    
    
    
    $
    689,795April 30, 2008
    
    
    
    
    
    
    638,332April 30, 2009
    
    
    
    
    
    
    547,864April 30, 2010
    
    
    
    
    
    
    348,477April 30, 2011
    
    
    
    
    
    
    218,272
  49




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##### Table of Contents



Balance as of April 30, 2004
    
    $
    4,998,242Goodwill acquired and adjustments during the year
    
    
    460,475Balance as of April 30, 2005
    
    
    5,458,717Goodwill acquired and adjustments during the year
    
    
    Balance as of April 30, 2006
    
    $
    5,458,717
        Fiscal Year Ended April 30, 2006First Quarter
    
    
    Second Quarter
    
    
    Third Quarter
    
    
    Fourth QuarterTotal revenues from continuing operations
    
    $
    4,609
    
    
    $
    4,651
    
    
    $
    4,544
    
    
    $
    4,886Gross profit from continuing operations
    
    
    2,146
    
    
    
    1,880
    
    
    
    1,885
    
    
    
    2,107Net earnings (loss)
    
    
    (337
    )
    
    
    (23
    )
    
    
    494
    
    
    
    392Net earnings (loss) per share  basic and diluted
    
    
    (0.10
    )
    
    
    (0.01
    )
    
    
    0.14
    
    
    
    0.11
 Fiscal Year Ended April 30, 2005First Quarter
    
    
    Second Quarter
    
    
    Third Quarter
    
    
    Fourth QuarterTotal revenues from continuing operations
    
    $
    4,472
    
    
    $
    6,752
    
    
    $
    4,761
    
    
    $
    5,646Gross profit from continuing operations
    
    
    1,382
    
    
    
    3,697
    
    
    
    1,644
    
    
    
    2,197Net earnings (loss)
    
    
    (1,105
    )
    
    
    521
    
    
    
    (248
    )
    
    
    2,633Net earnings (loss) per share  basic and diluted
    
    
    (0.30
    )
    
    
    0.15
    
    
    
    (0.07
    )
    
    
    0.75
     50




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##### Table of Contents



CostsInitial Cost to Company
    
    CapitalizedBuilding
    
    Subsequent toand
    
    AcquisitionDescription
    
    Encumbrances
    
    Land
    
    Improvements
    
    ImprovementsINCOME-PRODUCING PROPERTIES:Kmart  Morton, IL
    
    $
    1,924,688
    
    
    $
    18,005
    
    
    $
    2,767,764
    
    
    $
    Kmart  Columbus, GA
    
    
    757,908
    
    
    
    11,710
    
    
    
    2,356,920
    
    
    
    10,078Leaseback Shopping Center  Davenport, IA
    
    
    
    
    
    
    
    
    
    
    2,150
    
    
    
    193,261Leaseback Shopping Center  Jacksonville, FL
    
    
    
    
    
    
    
    
    
    
    42,151
    
    
    
    Leaseback Shopping Center  Orange Park, FL
    
    
    
    
    
    
    
    
    
    
    127,487
    
    
    
    35,731Office BuildingAtlanta, GA
    
    
    4,627,932
    
    
    
    660,000
    
    
    
    4,338,102
    
    
    
    869,434Office ParkMarietta, GA
    
    
    5,879,678
    
    
    
    1,750,000
    
    
    
    6,417,275
    
    
    
    1,345,610Shopping Center  Jacksonville, FL
    
    
    7,546,486
    
    
    
    3,908,004
    
    
    
    5,170,420
    
    
    
    689,15320,736,692
    
    
    
    6,347,719
    
    
    
    21,222,269
    
    
    
    3,143,267REAL ESTATE HELD FOR FUTURE DEVELOPMENT OR SALE:Land  Oakwood, GA
    
    
    
    
    
    
    234,089
    
    
    
    
    
    
    
    543,330Land North Ft. Myers
    
    
    
    
    
    
    464,329
    
    
    
    
    
    
    
    345,144Land and Building  Atlanta, GA(4)
    
    
    
    
    
    
    92,226
    
    
    
    722,033
    
    
    
    
    
    
    
    790,644
    
    
    
    722,033
    
    
    
    888,474$
    20,736,692
    
    
    $
    7,138,363
    
    
    $
    21,944,302
    
    
    $
    4,031,741
  Real Estate
    
    Accumulated Depreciation2006
    
    
    2005
    
    2004
    
    2006
    
    
    2005
    
    2004BALANCE AT BEGINNING OF YEAR
    
    $
    38,577,901
    
    
    
    $
    45,509,783
    
    
    $
    64,516,511
    
    
    $
    10,471,525
    
    
    
    $
    11,911,108
    
    
    $
    15,784,645ADDITIONS DURING YEARReal estate
    
    
    724,334
    
    
    
    
    621,296
    
    
    
    4,940,289
    (8)
    
    
    
    
    
    
    
    
    
    
    
    Depreciation from continuing
operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    692,787
    
    
    
    
    817,124
    
    
    
    838,204Depreciation from discontinued
operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    170,525
    
    
    
    
    218,330
    
    
    
    97,934Transfers
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    724,334
    
    
    
    
    621,296
    
    
    
    4,940,289
    
    
    
    863,312
    
    
    
    
    1,035,454
    
    
    
    936,138DEDUCTIONS DURING YEARAccumulated depreciation on
properties sold or transferred
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    614,979
    (6)
    
    
    
    2,475,037
    (7)
    
    
    4,809,675
    (9)Carrying value of real estate sold,
transferred, or retired
    
    
    5,932,033
    (6)
    
    
    
    7,553,178
    (7)
    
    
    23,947,017
    (9)
    
    
    
    
    
    
    
    
    
    
    
    5,932,033
    
    
    
    
    7,553,178
    
    
    
    23,947,017
    
    
    
    614,979
    
    
    
    
    2,475,037
    
    
    
    4,809,675BALANCE AT CLOSE OF YEAR
    
    $
    33,370,202
    
    
    
    $
    38,577,901
    
    
    $
    45,509,783
    
    
    $
    10,719,858
    
    
    
    $
    10,471,525
    
    
    $
    11,911,108
 51




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##### Table of Contents



Life on WhichGross Amounts at Which Carried at Close of Year
    
    
    
    
    
    
    
    
    
    
    
    
    
    Depreciation InBuilding
    
    
    
    
    
    
    
    
    
    Net
    
    
    
    
    
    
    
    
    
    Latest Earningsand
    
    Capitalized
    
    
    
    
    
    Accumulated
    
    
    Date(s) of
    
    Date
    
    Statement IsLand
    
    Improvements
    
    Interest
    
    Total(1)
    Depreciation
    
    Construction
    
    Acquired
    
    Computed$
    18,005
    
    
    $
    2,767,764
    
    
    $
    
    
    
    $
    2,785,769
    
    
    $
    2,767,764
    
    
    
    1980, 1992
    
    
    
    
    
    
    25 years11,710
    
    
    
    2,366,998
    
    
    
    238,970
    
    
    
    2,617,678
    
    
    
    2,605,495
    
    
    
    1980, 1988
    
    
    
    
    
    
    25 years
    
    
    
    195,411
    
    
    
    
    
    
    
    195,411
    
    
    
    188,138
    
    
    
    1995
    
    
    
    
    
    
    7 years
    
    
    
    42,151
    
    
    
    
    
    
    
    42,151
    
    
    
    22,761
    
    
    
    1994
    
    
    
    
    
    
    25 years
    
    
    
    163,218
    
    
    
    
    
    
    
    163,218
    
    
    
    163,218
    
    
    
    1995
    
    
    
    
    
    
    7 years660,000
    
    
    
    5,207,536
    
    
    
    
    
    
    
    5,867,536
    
    
    
    1,518,690
    
    
    
    1974, 1997
    (2)
    
    
    1997
    
    
    39 years1,750,000
    
    
    
    7,762,885
    
    
    
    
    
    
    
    9,512,885
    
    
    
    1,993,808
    
    
    
    1980, 1985
    (3)
    
    
    1997
    
    
    39 years3,908,004
    
    
    
    5,859,573
    
    
    
    
    
    
    
    9,767,577
    
    
    
    967,434
    
    
    
    1985
    (3)
    
    
    1999
    
    
    39 years6,347,719
    
    
    
    24,365,536
    
    
    
    238,970
    
    
    
    30,952,225
    
    
    
    10,227,308777,419
    
    
    
    
    
    
    
    16,644
    
    
    
    794,063
    
    
    
    
    
    
    
    
    
    
    
    1987
    
    
    809,655
    
    
    
    
    
    
    
    
    
    
    
    809,655
    
    
    
    
    
    
    
    
    
    
    
    1993
    
    
    92,226
    
    
    
    722,033
    
    
    
    
    
    
    
    814,259
    
    
    
    492,550
    
    
    
    
    (5)

    
    
    1960, 1968
    
    
    1,679,300
    
    
    
    722,033
    
    
    
    16,644
    
    
    
    2,417,977
    
    
    
    492,550$
    8,027,019
    
    
    $
    25,087,569
    
    
    $
    255,614
    
    
    $
    33,370,202
    
    
    $
    10,719,858
  (1)
    
    The aggregated cost for land and building and improvements for federal income tax purposes at
April 30, 2006, is $26,294,006.(2)
    
    Developed by others in 1974, redeveloped by the Company in 1997.(3)
    
    Developed by others.(4)
    
    Vacant; former manufacturing facility.(5)
    
    Original building constructed by others prior to 1960.(6)
    
    Primarily represents the sale of the professional medical office building in Douglasville,
Georgia, three parcels in North Fort Myers, Florida, and one parcel in Louisville, Kentucky.(7)
    
    Primarily represents the sale of a shopping center in Cincinnati, Ohio and Jackson, Michigan.(8)
    
    Primarily represents the acquisition of the professional medical office building in
Douglasville, Georgia.(9)
    
    Primarily represents the sale of a shopping center in North Fort Myers, Florida.
 52




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##### Table of Contents



PART III
 
    53




---



##### Table of Contents



PART IV
 
    
  
    (1)  (2) (5)  (3)  (4)  (6)  (7)  (7)  (8)  (9)
 
  (1)
    
    This exhibit is incorporated by reference to the Companys Form 10-K for the year ended April
30, 1985 (SEC File No. 
0-10146).(2)
    
    This exhibit is incorporated by reference to the Companys Form 10-K for the year ended April
30, 1997 (SEC File No. 
0-10146).(3)
    
    This exhibit is incorporated by reference to the Companys Form 10-K for the year ended April
30, 1991 (SEC File No. 
0-10146).(4)
    
    This exhibit is incorporated by reference to the Companys Form 10-K for the year ended April
30, 1993 (SEC File No. 
0-10146).(5)
    
    This exhibit is incorporated by reference to the Companys Form 10-K for the year ended April
30, 1998 (SEC File No. 
0-10146).(6)
    
    This exhibit is incorporated by reference to the Companys Form S-8 filed September 29, 2000
(SEC File No. 0-10146).(7)
    
    This exhibit is incorporated by reference to the Companys Form 10-K for the year ended April
30, 2001 (SEC File No. 
0-10146).(8)
    
    This exhibit is incorporated by reference to the Companys Form 10-K for the year ended April
30, 2003 (SEC File No. 
0-10146).(9)
    
    This exhibit is incorporated by reference to the Companys Form 10-Q for the quarter ended
October 31, 2005 (SEC File No. 0-10146).#
    
    Management compensatory plan or arrangement.
 (B)
    
    The Company hereby files as exhibits to this Annual Report on Form 10-K the exhibits set forth
in Item 15(A)3 hereof.(C)
    
    The Company hereby files as financial statement schedules to this Annual Report on Form 10-K
the financial statement schedules set forth in Item 15(A)2 hereof.




54



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##### Table of Contents



SERVIDYNE, INC.Dated: July 26, 2006
    By:

/s/ Alan R. AbramsAlan R. AbramsChief Executive Officer  Dated: July 26, 2006

/s/ Alan R. AbramsAlan R. AbramsChairman of the Board of Directors,

Chief Executive Officer Dated: July 26, 2006

/s/ J. Andrew AbramsJ. Andrew AbramsDirector Dated: July 26, 2006
    /s/ David L. AbramsDavid L. AbramsDirector Dated: July 26, 2006
    /s/ Samuel E. AllenSamuel E. AllenDirector Dated: July 26, 2006
    /s/ Gilbert L. DanielsonGilbert L. DanielsonDirector Dated: July 26, 2006
    /s/ Melinda S. GarrettMelinda S. GarrettDirector Dated: July 26, 2006
    /s/ Robert T. McWhinney, Jr.Robert T. McWhinney, Jr.Director Dated: July 26, 2006

/s/ Mark J. ThomasMark J. ThomasChief Financial Officer  55