<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    FORM 10-K

(Mark One)

     [X]  Annual Report Pursuant to Section 13 or 15(d) of the Securities
          Exchange Act of 1934.
          For the fiscal year ended December 31, 2002 or

     [_]  Transition Report Pursuant to Section 13 or 15(d) of the Securities
          Exchange Act of 1934.
          For the transition period from _________ to __________

                         COMMISSION FILE NUMBER 33-26991

                   ------------------------------------------

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             (Exact name of Registrant as specified in its charter)
<TABLE>
           DELAWARE                                    5033                     39-1413708
<S>                                        <C>                               <C>
(State or other jurisdiction of            (Primary Standard Industrial      (I.R.S. Employer
incorporation or organization)             Classification Code Number)       Identification No.)
</TABLE>

           ONE ABC PARKWAY,
           BELOIT, WISCONSIN                                            53511
(Address of principal executive offices)                              (Zip Code)


                                  608-362-7777
              (Registrant's telephone number, including area code)

                     ---------------------------------------

     SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
     NONE

     SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
     NONE

     Indicate by check whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes  X   No___
                                       ---

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]

     Indicate by  check mark whether the registrant is an accelerated filer
(as defined in Rule 12b-2 of the Act). Yes ___ No  X
                                                  ---

     The Registrant is filing this report pursuant to certain of its indenture
obligations and not as required under Section 13 or 15(d) of the Securities
Exchange Act of 1934.

<PAGE>

                                     PART I

ITEM 1. BUSINESS

     General

     American Builders & Contractors Supply Co., Inc. (the Company or ABC) is a
distributor of exterior building products and is the largest wholesale
distributor of roofing products and one of the largest wholesale distributors of
vinyl siding materials in the United States, operating 256 distribution centers
located in 44 states and the District of Columbia. ABC provides its customers
with access to what it believes to be the largest selection of roofing and vinyl
siding materials in the industry and with a knowledgeable staff capable of
providing product specific information, delivery capabilities to the job site,
as well as credit services and marketing support. For the year ended December
31, 2002, the Company generated net sales of $1.4 billion.

     The products distributed by the Company consist primarily of roofing and
siding materials, windows and related tools and accessories for residential and,
to a lesser extent, commercial applications. The Company markets these products
on a wholesale basis primarily to small and medium-sized contractors that are
involved in the replacement segment of the construction industry. ABC also
distributes products to builders and subcontractors involved in new construction
projects.

     ABC was founded in 1982 by Kenneth A. Hendricks, the stockholder, Chief
Executive Officer and Chairman of the Board, who as the owner of a successful
roofing business, saw a market for the Company's services. Since its inception,
ABC has experienced significant growth. The Company's net sales have increased
from $1.2 billion for the year ended December 31, 1998 to $1.4 billion for the
year ended December 31, 2002, representing a compound annual growth rate of
4.2%. In addition, comparable distribution center sales have grown at an average
annual rate of 4.1% over the same period.

     Products, Customers and Markets

     The roofing and vinyl siding products industry contains three primary
distribution channels: manufacturers' direct sales; mass merchandisers, such as
Home Depot; and wholesale distributors, such as the Company. Mass merchandisers
primarily sell products to homeowners and small contractors, tend to stock items
across a multitude of building supply categories and stock a relatively narrow
selection of non-premium grade roofing and siding products. Typically,
manufacturers do not sell products directly to retail customers or small
contractors.

     The products distributed by the Company consist primarily of roofing
products, including both steep slope (commonly referred to as residential) and
low slope (commonly referred to as commercial), siding products, windows, and
related tools, equipment and accessories. ABC provides its customers with what
it believes to be the largest selection of roofing and vinyl siding materials in
the industry. The products that the Company distributes can be classified in the
following five categories:

     Steep slope roofing products and accessories. The Company distributes a
broad selection of shingles, felt, roof tile, wood shakes, flashings, vents and
other roofing products to residential roofing contractors. Principal brands of
residential roofing products include CertainTeed(R), Elk(R), GAF(R),
Owens-Corning(R), and Tamko(R).

     Low slope roofing products and accessories. The Company distributes a broad
selection of modified bitumen, EPDM, hypalon, PVC, TPO, other rolled roofing,
felts, coatings, asphalt, flashings, vents, fasteners, roof insulation and other
roofing products to commercial roofing contractors. Principal brands of
commercial roofing products include Atlas(R), CertainTeed(R), Firestone(R),
GAF(R), Johns Manville(R), Mule-Hide(R), and US Intec(R). Mule-Hide, a wholly
owned subsidiary, primarily sells its private label roofing systems through
ABC's distribution centers.

     Siding products and accessories. The Company distributes a broad selection
of siding products to siding contractors. The Company's siding products consist
primarily of vinyl siding, soffits and accessories and, to a lesser extent,
gutters, fiber cement, aluminum and wood siding. Principal vinyl siding brands
include Alcoa(R), Amcraft(R), CertainTeed(R), Mastic(R), and Wolverine(R).
Amcraft, a wholly owned subsidiary, exclusively sells its private label siding
and accessories through ABC's distribution centers.

                                       2

<PAGE>

     Windows and accessories. The Company distributes a broad selection of
window products and accessories to residential window installers, including
vinyl, wood and aluminum window frames and single, double and triple glazed
windows. Principal window brands include CertainTeed(R), Weather-Shield(R), and
Amcraft(R). Amcraft exclusively sells its private label windows and accessories
through ABC's distribution centers.

     Other building products and accessories. The Company distributes a variety
of roofing and siding products to complement its primary product lines. Such
products include sheet metal, roofing and siding equipment, tools and other
related accessories.

     The following table sets forth certain information regarding the Company's
net sales by product for the years ended December 31, 2002, 2001 and 2000:

                                                     Total Net Sales
                                            ----------------------------------
         Product Categories                    2002        2001         2000
                                            ----------------------------------
                                                      (in millions)
         Steep slope                        $   816.4   $   800.6    $   720.1
         Low slope                              275.0       294.3        262.9
         Siding                                 217.5       176.7        156.0
         Windows                                 67.4        61.2         49.4
         Other                                   48.4        48.7         50.5
                                            ----------------------------------
            Total for all categories        $ 1,424.7   $ 1,381.5    $ 1,238.9
                                            ==================================

     The Company distributes these products on a wholesale basis primarily to
small and medium-sized contractors that are involved in the replacement segment
of the construction industry. ABC also distributes products to builders and
subcontractors involved in new construction projects.

     Sales and Marketing

     The Company's sales organization consists of outside sales personnel who
report directly to their local distribution center manager and are supported by
inside customer service representatives at the distribution center. A
substantial portion of each of the outside sales personnel pay is derived from
commissions. Additional support comes from a number of regional sales and
merchandising managers who educate the Company's sales personnel and customers
regarding technical specifications and marketability of certain products.

     Distribution Center Operations

     The Company operates 256 local distribution centers located in 44 states
and the District of Columbia. Since January 1, 2000 the Company has opened 31
distribution centers, closed 13 distribution centers and acquired an additional
56 distribution centers, while consolidating 18 distribution centers in
connection with its selective acquisition program. A typical distribution center
consists of showroom space, office space, warehouse and receiving space, secure
outdoor holding space and a loading dock. ABC's distribution centers range in
size from approximately 2,000 to approximately 110,000 square feet, with a
typical size of approximately 40,000 square feet.

     Each location is managed by a distribution center manager who oversees the
center's employees, including various sales and office personnel, as well as
delivery and warehouse personnel. The Company requires that each distribution
center develop a core merchandising strategy, but allows each distribution
center manager under the direction of the region staff and national director of
merchandising to alter the product mix of a given center to meet local market
demands. Distribution center employees' bonus levels are largely driven by
location profitability. The Company believes its incentive programs have
contributed significantly to its growth and have helped it to achieve an average
annual growth rate of comparable distribution center sales of 4.1% over the past
five years.

                                       3

<PAGE>

     The following table sets forth the Company's growth in terms of
distribution centers in each of the past three years:

                                                          2002    2001   2000
                                                        -----------------------

          Distribution centers on January 1                215     200    200
          Distribution centers acquired                     44       9      3
          Distribution centers opened                       15      11      5
          Acquired distribution centers consolidated       (16)     (2)     0
          Distribution centers closed                       (2)     (3)    (8)
                                                        -----------------------
          Distribution centers on December 31              256     215    200
                                                        =======================

     Competition

     The roofing and siding products distribution industry is highly competitive
and fragmented. The Company competes directly with a large number of local and
regional building products distributors and, in certain markets and product
categories, with a few national distributors. The Company also competes to a
lesser extent with mass-merchandisers, such as Home Depot, and with direct sales
from building products manufacturers.

     Purchasing

     ABC purchases its products directly from a wide variety of manufacturers,
including GAF, Elk Corporation of America, Tamko, CertainTeed, Owens-Corning
Fiberglass Corporation, Johns Manville Corporation and Alcoa Building Products,
Inc. Payment, discount and volume purchase programs are negotiated directly by
the Company with its major suppliers, with a significant portion of the
Company's purchases made from suppliers offering these programs. The Company
believes it is the largest or a significant customer to many of its primary
suppliers, and, as a result, is able to negotiate volume discounts and other
favorable terms. At 13.5% of the Company's 2002 product purchases, GAF
(including its subsidiaries U.S. Intec, and Leatherback) was the only supplier
which represented more than 10% of the Company's total purchases. The Company
typically purchases its products from manufacturers pursuant to individual
purchase orders, and does not generally enter into long-term contracts for the
purchase of products.

     Seasonality

     Because of cold weather conditions in many of the markets in which the
Company does business and the seasonal nature of the roofing and siding business
generally, the Company's revenues vary substantially throughout the year, with
its lowest revenues typically occurring in the months of December through
February.

     Employees

     As of December 31, 2002, the Company employed 3,535 full-time and 176
part-time employees, of whom 41 were members of unions. The Company's collective
bargaining agreements with its unions expire on various dates, from May 2003
through September 2005. The Company believes that its relations with its
employees are good.

                                       4

<PAGE>

     Environmental Matters

     A number of roofing materials are considered environmentally hazardous. The
Company typically handles and stores a variety of these materials at its
distribution center locations. The Company maintains appropriate environmental
compliance programs at each of its distribution centers and has never been the
subject of any material enforcement action by any governmental agency.

     Many of the Company's distribution centers are located in areas of current
or former industrial activity, where environmental contamination may have
occurred. Under various federal, state and local environmental laws, ordinances
and regulations, a current or previous owner or operator of real estate may be
required to investigate and remediate releases or threatened releases of
hazardous or toxic substances or petroleum products located at such property,
and may be held liable for property damage and for investigation and remediation
costs in connection with the contamination.

     The Company does not believe there are any material environmental
liabilities at any of its distribution center locations. Nevertheless, there can
be no assurance that the Company's knowledge is complete with regard to all
material environmental liabilities and it could subsequently discover potential
environmental liabilities arising from its sites or from neighboring facilities.

ITEM 2. PROPERTIES

     The Company operates both owned and leased branches in 44 states and the
District of Columbia. Its facilities range in size from approximately 2,000 to
110,000 square feet. This building space is used for warehousing and
distribution purposes and, to a lesser extent, for sales and administrative
purposes. The Company owns a 118,000 square foot office building where its
corporate offices are located in Beloit, Wisconsin. The Company believes its
facilities are adequately maintained and utilized and are suitable for the
purposes for which they are used. See Note 5 to the Consolidated Financial
Statements of the Company for a summary of payments due under the Company's
leases.

The following table sets the geographical location of the Company's distribution
centers as of December 31, 2002:

                                            Total Number
 Region                                     of Locations
 ----------------------------------------------------------

 Midwest                                          59
 Northeast                                        44
 Southwest                                        43
 Southeast                                        43
 Western                                          34
 Rocky Mountain                                   33
                                          -----------------
                                                 256
                                          =================

ITEM 3. LEGAL PROCEEDINGS

     The Company is a party to various litigation matters incidental to the
conduct of its business. The Company does not believe that the outcome of any of
the matters in which it is currently involved will have a material adverse
effect on its financial condition or results of operations.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     There were no matters submitted to a vote of security holders during 2002.

                                       5

<PAGE>

                                     PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

     There is no public market for the stock of the Company. There was one
holder of record of the Company's common stock as of December 31, 2002.

ITEM 6. SELECTED FINANCIAL DATA

     The following table sets forth the selected consolidated financial
information of the Company for each of the five years in the period ended
December 31, 2002. The information contained in the following table should be
read in conjunction with, and is qualified in its entirety by reference to, the
information set forth under the caption "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and the Company's audited
consolidated financial statements and related notes included elsewhere in this
report.

<TABLE>
<CAPTION>
                                                                     Year Ended December 31,
                                                                          (in thousands)
                                                  ---------------------------------------------------------------
                                                      2002        2001         2000        1999         1998
                                                  ---------------------------------------------------------------
<S>                                               <C>         <C>          <C>         <C>         <C>
Income Statement Data
Net sales                                         $1,424,705  $1,381,530   $1,238,937  $1,197,509  $1,162,110
Cost of sales                                      1,055,093   1,037,192      936,627     914,971     894,450
                                                  --------------------------------------------------------------
Gross profit                                         369,612     344,338      302,310     282,538     267,660

Operating expenses                                   312,770     280,647      262,719     244,627     239,968
Amortization of intangible assets                        369       1,611        1,601       1,686       1,735
Non-recurring charges                                      -           -            -       7,030       3,900
                                                  -------------------------------------------------------------
Operating income                                      56,473      62,080       37,990      29,195      22,057
Net interest expense                                 (14,383)    (18,979)     (24,693)    (22,413)    (24,532)
                                                  -------------------------------------------------------------
Income (loss) before provision for income taxes
     and extraordinary item                           42,090      43,101       13,297       6,782      (2,475)
Provision for income taxes (1)                           981         865          280         171         170
                                                  -------------------------------------------------------------
Income (loss) before extraordinary item               41,109      42,236       13,017       6,611      (2,645)
Extraordinary item                                         -           -        1,043          -           -
                                                  -------------------------------------------------------------
Net income (loss)                                 $   41,109  $   42,236   $   14,060  $    6,611  $   (2,645)
                                                  =============================================================
Balance Sheet Data (at end of period)
Accounts receivable, net                          $  209,813  $  167,253   $  142,768  $  143,864  $  149,103
Inventories                                          191,049     157,810      151,578     135,511     130,802
Total assets                                         562,640     449,633      417,270     408,458     412,901
Accounts payable and accrued liabilities             155,391     127,297      100,545     104,773     107,040
Long-term debt, less current maturities              296,857     236,929      271,480     270,429     281,658
Stockholder's equity                                 101,671      75,162       39,178      27,674      19,147
</TABLE>

(1)  Consists of certain state and local income taxes. As Subchapter S
     Corporations under the Internal Revenue Code of 1986, as amended (the
     Code), the Company and its subsidiaries are not subject to U.S. federal
     income taxes or most state income taxes. Instead, such taxes have been paid
     by Mr. Hendricks. The Company has made periodic distributions to Mr.
     Hendricks in respect of such tax liabilities in accordance with the terms
     of the Tax Allocation Agreement (as defined herein). See "Certain
     Relationships and Related Transactions."

                                       6

<PAGE>

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

     Results of Operations

     The following table summarizes the Company's historical results of
operations as a percentage of net sales for each of the three years ended
December 31, 2002:

<TABLE>
<CAPTION>
                                                       Year Ended December 31,
                                                 --------------------------------------
                                                     2002         2001        2000
                                                 --------------------------------------
<S>                                              <C>              <C>         <C>
          Income Statement Data

          Net sales                                  100.0%       100.0%      100.0%
          Cost of sales                               74.1         75.1        75.6
                                                 --------------------------------------
          Gross profit                                25.9         24.9        24.4

          Operating expenses                          21.9         20.3        21.2
          Amortization of intangible assets            0.0          0.1         0.1
                                                 --------------------------------------
          Total operating expenses                    21.9         20.4        21.3
                                                 --------------------------------------
          Operating income                             4.0%         4.5%        3.1%
                                                 ======================================
</TABLE>

     Comparison of the Year Ended December 31, 2002 to the Year Ended December
31, 2001

     Net sales for the year ended December 31, 2002 increased by 3.1%, or $43.2
million in 2002 to $1.42 billion as a result of an increase in the number of
distribution center locations. Comparable distribution center sales declined by
1.6% in 2002. The decrease in comparable distribution center sales is due to an
overall economic slowdown in the building products industry primarily in the
commercial, low slope, roofing market and not a loss of market share.

     Gross profit for the year ended December 31, 2002 increased by 7.3% in 2002
to $369.6 million from $344.3 million in 2001. Gross profit, as a percentage of
net sales in 2002 increased to 25.9% from 24.9% in 2001. Gross profit, as a
percentage of net sales, increased primarily due to a higher percentage of
distribution center warehouse sales versus "direct" sales (product shipped from
the vendor directly to the customer's job site), which have significantly lower
gross profit margins.

     Operating expenses for the year ended December 31, 2002 increased by 11.4%
in 2002 to $312.8 million from $280.6 million in 2001. As a percentage of net
sales, operating expenses increased to 21.9% in 2002 from 20.3% in 2001. The
increase in operating expenses is primarily due to the higher percentage of
distribution center warehouse sales, which require greater operating expense,
and to a lesser extent, the increase in operating expenses is due in part to the
one time start up costs of new locations, as well as the initial costs
associated with acquisitions and subsequent consolidations into existing
distribution centers.

      Amortization of intangible assets decreased to $0.4 million in 2002 from
$1.6 million in 2001. The decrease was due to the adoption of Statement of
Financial Accounting Standards (SFAS) No. 142 as of January 1, 2002. Under SFAS
No. 142, goodwill is no longer amortized, but instead, is reviewed for
impairment on an annual basis.

     Interest expense decreased by $4.3 million to $15.0 million in 2002 from
$19.3 million in 2001. The decrease is primarily due to decreased interest rates
on the Company's LIBOR based borrowings as well as a reduction in the Company's
average borrowings during the year.

                                       7

<PAGE>

     Comparison of the Year Ended December 31, 2001 to the Year Ended December
31, 2000

     Net sales for the year ended December 31, 2001 increased by 11.5%, or
$142.6 million in 2001 to $1.38 billion. Comparable distribution center sales
growth was 9.8% in 2001.

     Gross profit for the year ended December 31, 2001 increased by 13.9% in
2001 to $344.3 million from $302.3 million in 2000. This increase in gross
profit is primarily a result of profits associated with increased sales.

      Gross profit, as a percentage of net sales in 2001 increased to 24.9% from
24.4% in 2000. Management believes the improvement in gross profit percentage
relates primarily to strategic merchandising initiatives, including pricing,
purchasing, and incentive programs which began in 2000 at the distribution
centers to increase gross profit margin. The gross profit percentage increase is
also due in part to management's continued focus on improving gross profit
through increased sales of products with higher gross profit margins.

     Operating expenses for the year ended December 31, 2001 increased by 6.8%
in 2001 to $280.6 million from $262.7 million in 2000. As a percentage of net
sales, operating expenses decreased to 20.3% in 2001 from 21.2% in 2000.
Operating expenses as a percentage of net sales in 2001 are in line with
historic levels for the Company. A primary factor in the decrease of operating
expenses as a percentage of net sales is related to a comprehensive evaluation
and design of new operating and administrative processes undertaken by the
Company in 2000, during which the Company engaged a consulting firm, and added
internal project coordinators as well as financial analysts. This evaluation
resulted in the development and implementation of policies and programs enabling
more consistent merchandising, purchasing and pricing within local markets and
in turn improving gross profit, as well as streamlining internal processes.

     Amortization of intangible assets remained at $1.6 million in 2001 and
2000.

     Interest expense decreased by $5.7 million to $19.3 million in 2001 from
$25.0 million in 2000. The decrease is primarily due to decreased interest rates
on the Company's LIBOR based borrowings as well as a reduction in the Company's
average borrowings.

     Liquidity and Capital Resources

     Cash Flows from Operating Activities. Net cash provided by operations was
$56.0 million for the year ended December 31, 2002 compared to $60.6 million for
the year ended December 31, 2001 and $14.8 million for the year ended December
31, 2000. The decrease in 2002 from 2001 was principally due to a lesser
increase in accounts payable and an increase in the provision for doubtful
accounts, being partially offset by a smaller increase in accounts receivable
and an increase in inventories. The increase in 2001 over 2000 was principally
due to improved earnings and increased accounts payable being partially offset
by an increase in accounts receivable.

     Cash Flows from Investing Activities. Net cash used in investing activities
was $84.1 million, $20.4 million and $16.7 million for the years ended December
31, 2002, 2001 and 2000, respectively. The Company's investing activities
consist primarily of costs associated with capital expenditures and acquisitions
of businesses. Capital expenditures, comprised mainly of routine delivery
vehicle replacements, were $26.5 million, $15.8 million and $15.9 million for
the years ended December 31, 2002, 2001 and 2000, respectively. Other investing
activities include the acquisition of building products businesses. Acquisitions
of businesses were $58.3 million, $5.5 million and $2.5 million for the years
ended December 31, 2002, 2001 and 2000, respectively.

                                       8

<PAGE>

     Cash Flows from Financing Activities. Net cash provided by (used in)
financing activities was $28.7 million, $(39.1) million and $2.2 million for the
years ended December 31, 2002, 2001 and 2000, respectively. The Company's
financing activities consist primarily of the borrowings incurred in connection
with the growth of its existing distribution centers as well as acquisition of
building product businesses, repayment of debt with cash flows from operations
and, to a lesser extent, distributions to the Company's stockholder in respect
of tax liabilities related to the Company. The increase in the receivable from
affiliates in 2002 is a result of twelve new properties purchased by the
affiliates that are leased by the Company for its distribution center
operations.

     Liquidity. The Company's principal sources of funds are anticipated to be
cash flows from operating activities and borrowings under its revolving credit
agreement. The Company believes that these funds will provide the Company with
sufficient liquidity and capital resources to meet its financial obligations, as
well as to provide funds for the Company's working capital, capital expenditures
and other needs for the foreseeable future. No assurance can be given, however,
that this will be the case.

     Senior Subordinated Notes. As of December 31, 2002, the Company had $63.7
million of unsecured Senior Subordinated Notes outstanding bearing interest at
10 5/8%. These notes mature on May 15, 2007 and are subordinate to borrowings
under the revolving credit agreement. During 2001 and 2000, the Company
repurchased and retired $15.5 million and $11.6 million, respectively, of the
Senior Subordinated Notes. No repurchases of the Senior Subordinated Notes
occurred in 2002. The notes purchased in 2000 resulted in an extraordinary gain
of $1.0 million net of the write-off of the applicable unamortized deferred
financing costs and other expenses. The difference between the par value of the
notes repurchased in 2001 and the repurchase price, net of expenses and the
applicable portion of the unamortized deferred financing costs written off, was
not material.

     Revolving Credit Agreement. The Company is party to a credit agreement
which permits borrowings of up to $275 million under the revolving line of
credit (the Revolver), reduced by outstanding letters of credit. Debt
outstanding under the Revolver as of December 31, 2002 was $196.7 million and
borrowings under the Revolver are secured primarily by accounts receivable and
inventories. As amended in March 2002, the initial term of the Revolver expires
on June 30, 2005, but shall automatically extend for successive one-year
periods, unless written notice of termination is given by either party at least
sixty days prior to the end of a period.

     For information on the Company's contractual obligations for indebtedness,
operating leases and related obligations as of December 31, 2002, see Notes 3
and 5 of Notes to Consolidated Financial Statements.

     Critical Accounting Policies

     Accounts Receivable. The Company evaluates the collectibility of its
accounts receivable based on a number of factors. For larger accounts greater
than 90 days past due, an allowance for doubtful accounts is recorded based on a
customer's ability and likelihood to pay based on management's review of the
facts. A weighted average of these evaluations is applied to all smaller
accounts greater than 90 days past due. For all other customers, the Company
recognizes an allowance based on length of time the receivable is past due based
on historical experience.

     Acquisition Purchase Price Allocation. The Company records assets and
liabilities, including goodwill and other intangibles, acquired through
acquisitions at estimated fair market value. When necessary, fair market value
is determined by an independent appraisal or quote to purchase a similar asset
from a third party. Lives are assigned to these assets based on the Company's
property and equipment policies stated in Note 1 of the audited consolidated
financial statements. Lives assigned to identifiable intangible assets are
either set by contractual agreements or determined by management based on the
facts and circumstances. Should the fair market value or actual useful life
differ from those estimated at the time of the acquisition, results from
operations, financial position and cash flows, could be materially impacted.

     Related Party Transactions. The Company transacts business with a number of
affiliated companies owned by Mr. Hendricks and his spouse, Diane Hendricks. The
Company believes that these transactions between ABC and related entities have
been conducted on an arm's length basis. See Item 13 and Note 6 to the
Consolidated Financial Statements.

                                        9

<PAGE>

     New Accounting Standards. In August 2002, the Financial Accounting
Standards Board (FASB) issued SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets," which addresses financial accounting and
reporting for the impairment of long-lived assets and for long-lived assets to
be disposed of, as well as the accounting and reporting of discontinued
operations. The Company adopted SFAS No. 144 effective January 1, 2002, and the
adoption of SFAS No. 144 did not have a significant impact on the Company's
results of operations, financial position or cash flows.

     In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statements
No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical
Corrections." SFAS No. 145 rescinds SFAS No. 4, "Reporting Gains and Losses from
Extinguishment of Debt." Any gain or loss on the extinguishment of debt that was
classified as an extraordinary item in prior periods that does not meet specific
criteria for classification as an extraordinary item shall be reclassified. The
provisions of SFAS No. 145, related to the rescission of SFAS No. 4, will be
adopted by the Company effective January 1, 2003.

     In July 2002, the FASB issued SFAS No. 146, "Accounting for Costs
Associated with Exit or Disposal Activities." SFAS No. 146 requires companies to
recognize costs associated with exit or disposal activities when they are
incurred rather than at the date of a commitment to an exit or a disposal plan.
Examples of costs covered by SFAS No. 146 include lease termination costs and
certain employee severance costs that are associated with a restructuring,
discontinued operation, plant closing, or other exit or disposal activity. SFAS
No. 146 is to be applied prospectively to exit or disposal activities initiated
after December 31, 2002. The Company does not expect that the adoption of SFAS
No. 146 will have a significant impact on the Company's results of operations,
financial position or cash flows.

     In November 2002, the FASB issued Interpretation No. 45, "Guarantor's
Accounting and Disclosure Requirements for Guarantees, Including Indirect
Guarantees of Indebtedness of Others," (the Interpretation) which expands on the
guidance for the accounting and disclosure of guarantees. Each guarantee meeting
the characteristics described in the Interpretation is to be recognized and
initially measured at fair value. In addition, guarantors will be required to
make significant new disclosures, even if the likelihood of the guarantor making
payments under the guarantee is remote, which represents another change from
general current practice. The Interpretation's disclosure requirements are
effective for financial statements ending after December 15, 2002, while the
initial recognition and initial measurement provisions are applicable on a
prospective basis to guarantees issued or modified after December 31, 2002. The
Company is currently evaluating the requirements and impact of this
Interpretation on the Company's financial position and results of operations.

     Seasonality

     Because of cold weather conditions in many of the markets in which the
Company does business and the seasonal nature of the roofing and siding business
generally, the Company's revenues vary substantially throughout the year, with
its lowest revenues typically occurring in the months of December through
February.

     Inflation

     The Company believes that inflation did not have a material impact on its
results of operations for the three years ended December 31, 2002.

                                       10

<PAGE>

     Forward Looking Statements

     This Management's Discussion and Analysis of Financial Condition and
Results of Operations (MD&A) contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended. Such
forward-looking statements are based on the beliefs of the Company's management
as well as on assumptions made by and information currently available to the
Company at the time such statements were made. When used in this MD&A, the words
"anticipate," "believe," "estimate," "expect," "intends" and similar
expressions, as they relate to the Company are intended to identify
forward-looking statements, which include statements relating to, among other
things: (i) the ability of the Company to continue to successfully compete in
the roofing and vinyl siding products market; (ii) the anticipated benefits from
the Company's comprehensive evaluation of new operating and administrative
processes (iii) the continued effectiveness of the Company's sales and marketing
strategy; and (iv) the ability of the Company to continue to successfully
develop and launch new distribution centers. Actual results could differ
materially from those projected in the forward-looking statements as a result of
the matters discussed herein and certain economic and business factors, some of
which may be beyond the control of the Company.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     The Company is exposed to market risk related to changes in interest rates.
The Company does not use derivative financial instruments for speculative or
trading purposes.

     Interest Rate Sensitivity. The Company's earnings are affected by changes
in short-term interest rates as a result of its borrowings under the Revolver.
If market interest rates for such borrowings average 1% more during 2003 than
they did during 2002, the Company's interest expense would increase, and income
before income taxes would decrease by approximately $1.6 million. This analysis
does not consider the effects of the reduced level of overall economic activity
that could exist in such an environment. Further, in the event of a change of
such magnitude, management could take actions to further mitigate its exposure
to the change. However, due to the uncertainty of the specific actions that
would be taken and their possible effects, the sensitivity analysis assumes no
changes in the Company's financial structure.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     The financial statements and schedules are listed in Part IV, Item 15 of
this Form 10-K.

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

     None.

                                       11

<PAGE>

                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     The following table sets forth certain information with respect to (i) each
member of the Company's Board of Directors (the Board), (ii) each executive
officer of the Company and (iii) certain key employees of the Company.

Name                     Age                      Position
--------------------------------------------------------------------------------
Kenneth A. Hendricks     61   Chief Executive Officer and Chairman of the Board
David Luck               53   President, Chief Operating Officer, and Director
Diane Hendricks          55   Executive Vice President, Secretary, and Director
Kendra Story             43   Chief Financial Officer, Treasurer, and Director
Robert Bartels           54   Senior Vice President of Manufacturing Operations
Kevin Hendricks          38   Vice President of Branch Operations
Keith Rozolis            43   Vice President of Strategic Marketing and Planning
Gil Aleman               59   Director
Kent Nelson              58   Director

     Kenneth A. Hendricks serves as Chief Executive Officer and Chairman of the
Board. Prior to July 1998 when Mr. David Luck was hired, Mr. Hendricks also
served as the President. Prior to 1982, Mr. Hendricks was the owner and operator
of a number of successful exterior building contracting businesses and real
estate businesses.

     David Luck has served as President and Chief Operating Officer since July
of 1998, and a director since May of 1999. Prior to joining ABC, he was the
President of Bridgestone/Firestone Retail Operations Division, and the Senior
Vice President of Bridgestone/Firestone, Inc. As president he was responsible
for 1,550 retail stores selling tires and automotive services. Mr. Luck spent
twenty-seven years with Bridgestone/Firestone and held a variety of positions
with increasing responsibilities.

     Diane Hendricks has served as Executive Vice President, Secretary and a
director of the Company since its inception. Ms. Hendricks is also President of
American Patriot Insurance Agency, Inc. Ms. Hendricks is primarily responsible
for overseeing insurance, personnel matters, bonus programs, profit sharing and
legal matters for the Company.

     Kendra Story has served as the Chief Financial Officer, Treasurer and a
director of the Company since its inception. Ms. Story is primarily responsible
for overseeing finance, accounting, internal audit and inventory management for
the Company.

     Robert Bartels has served as the Company's Senior Vice President of
Manufacturing Operations since April 2002, and also served as the Senior Vice
President of Operations from September of 1997 to March 2002, prior to which, he
was the Director of Purchasing since 1996. From 1971 to 1996, Mr. Bartels was
employed by several leading manufacturers in the building materials industry
with a variety of positions with increasing responsibilities, which included
national marketing and sales and as vice president of sales.

     Kevin Hendricks has served as the Company's Vice President of Branch
Operations since April 2002, prior to which, he was the Regional Director of
Midwest Operations since 1998. From 1985 to 1997, Mr. Hendricks was employed by
the Company in several capacities with increasing responsibilities including
branch manager.

     Keith Rozolis has served as the Vice President of Strategic Marketing and
Planning since July 1999. Prior to joining ABC, Mr. Rozolis was with
Bridgestone/Firestone Retail Operations division since 1993, where he served in
several capacities including a Director of Tire Marketing. He also directed key
strategic initiatives related to marketing, service, systems and process
reengineering, and collaborative internet strategies.

     Gil Aleman has served as a director of the Company since 1997. Since April
2001, Mr. Aleman has been the President and CEO of Apache Products Company.
Prior to joining Apache, Mr. Aleman served as the Director of Operations for
American Mortgage Capital Inc., a major lender for all types of mortgages. He
was also the President of the Celotex roofing division for Jim Walter
Corporation from 1985 to 1997. Prior to 1985, Mr. Aleman served as President of
Jim Walter Window Components, a division of Jim Walter Corporation.

                                       12

<PAGE>

     Kent Nelson has served as a director of the Company since 1997. Mr. Nelson
is currently Chief Executive Officer and President of TJ Adams Group, LLC, a
regional insurance broker, and is an adjunct professor of management at the
Graduate School of Business, Northern Illinois University. Prior to joining TJ
Adams Group, he most recently served as managing director of Marsh McLennan and
AON Risk Services.

     Kenneth and Diane Hendricks are husband and wife. Kendra Story is a
daughter of Mr. Hendricks and Kevin Hendricks is a son of Mr. Hendricks.

ITEM 11.  EXECUTIVE COMPENSATION

     The compensation of executive officers of the Company is determined by the
Board. The following Summary Compensation Table includes individual compensation
information for the Chief Executive Officer and each of the four other most
highly compensated executive officers of the Company in the year ended December
31, 2002 for services rendered in all capacities to the Company and its
subsidiaries during the year ended December 31, 2002.

<TABLE>
<CAPTION>
                                                                                             All Other
Name and Principal Position                                       Annual Compensation     Compensation (1)
----------------------------------------------------------------------------------------------------------------
                                                                  Annual       Bonus
<S>                                                               <C>          <C>        <C>
Kenneth A. Hendricks
   Chief Executive Officer and Chairman of the Board             $1,592,308   $         -        $110,940
David Luck
   President and Chief Operating Officer                            574,990       568,416          13,952
Diane M. Hendricks
   Executive Vice President and Secretary                           275,002             -          63,500
Kendra Story
   Chief Financial Officer and Treasurer                            225,000       284,208           3,197
Robert Bartels
   Senior Vice President of Manufacturing Operations                220,385       284,208           3,307
</TABLE>

  (1)  Consists of estimated amounts paid by the Company for automobiles,
       discretionary matching payments under the Company's 401(k) Profit Sharing
       Plan and insurance premiums, respectively, as follows: Mr. Hendricks-
       $1,812, $5,250 and $58,302; Mr. Luck-$9,250, $4,702 and $0; Ms.
       Hendricks-$2,175, $3,023 and $58,302 Ms. Story-$113, $3,083 and $0 and
       Mr. Bartels-$0, $3,307 and $0.

     Mr. Luck is party to an agreement with the Company dated May 18, 1998,
which provides for his employment through April 30, 2005. As part of the
agreement, Mr. Luck received a one-time bonus of $1,500,000, one half of which
was paid in 1998 and the other half in 1999. The one-time bonus is subject to
repayment under conditions specified in the agreement. The agreement provides a
bonus program and severance package, and also contains noncompetition and
nonsolicitation covenants covering the term of the agreement plus two years from
the date of termination.

     Mr. Bartels is party to an agreement with the Company dated November 30,
1998 and amended November 30, 1999, which provides for his employment for a five
year period commencing on January 1, 1999. The agreement provides a bonus
program and severance package, and also contains noncompetition and
nonsolicitation covenants covering the term of the agreement plus two years from
the date of termination.

     For a description of the employment agreement entered into between Mr.
Hendricks and the Company, see "Certain Relationships and Related Transactions."

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     All of the Company's capital stock is owned beneficially and of record by
Mr. Hendricks. There are no outstanding options or other rights to purchase any
shares of the Company's capital stock.

                                       13

<PAGE>

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     ABC transacts business with a number of entities, including Corporate
Contractors, Inc. (CCI), Blackhawk Transportation, Inc. (Blackhawk), Amfinity
Capital, LLC (Amfinity), Water Tower Industrial Properties (Water Tower),
Hendricks Commercial Properties and it subsidiaries (HCP), Hendricks Carolina
Properties, LLC (Carolina), Cornell Felt Acquisition, LLC (Cornell), Patriot,
Ltd. (Patriot) and American Patriot Insurance Agency, Inc. (APIA) (collectively,
the Related Entities), which are owned by ABC's stockholder and his spouse. CCI
performs construction work such as interior renovations and additions at ABC
locations. Blackhawk provides transportation services for the Company. The
Company leases properties from Water Tower, Carolina, Cornell and HCP. Amfinity
provides business advisory services. APIA is an insurance broker who provides
services and arranges insurance for ABC. The Company believes that the
transactions between ABC and the Related Entities have been conducted on an
arm's-length basis.

     In connection with certain of the Company's acquisitions, the Company's
stockholder or his affiliates have purchased the real estate of the acquired
business, which the Company has then leased from Mr. Hendricks or his
affiliates. In addition, certain of the distribution centers opened by the
Company are located in facilities purchased by and leased from Mr. Hendricks or
his affiliates. These real estate purchases have historically been financed with
a combination of debt financing and equity, and a portion of the equity has
sometimes been funded by Mr. Hendricks or his affiliates with borrowings from
ABC. The aggregate amount of such borrowings from ABC outstanding as of December
31, 2002 was approximately $15.7 million and $4.9 million as of December 31,
2001. The Company and Mr. Hendricks currently intend to continue to acquire
properties for the Company's occupancy using such method of financing. At
December 31, 2002, the Company's debt agreements will permit it to lend up to
approximately $17.0 million to Mr. Hendricks or his affiliates in connection
with such transactions in the future. Interest is charged on such loans at a
rate comparable to the rate the Company pays on its Revolver. The maximum amount
of such borrowings at any time during the three years ended December 31, 2002,
occurred in December 2002 and aggregated $15.7 million.

     As described above, as of December 31, 2002, the Company leased 119
facilities from Mr. Hendricks or his affiliates compared to 110 facilities as of
December 31, 2001, and 106 facilities as of December 31, 2000. For the years
ended December 31, 2002, 2001 and 2000, the Company paid $14.2 million, $12.5
million, and $11.7 million, respectively, in lease payments to Mr. Hendricks or
his affiliates in respect of such properties. Annual payments due under these
leases are based on the prevailing market rates in the areas in which such
properties are located and are adjusted annually to reflect changes in the
consumer price index.

     As of December 31, 2002 and 2001, the Company had obligations outstanding
under guarantees and letters of credit in respect of debt of Mr. Hendricks and
his affiliates in the amounts of $6.3 million and $6.7 million, respectively.
Such guarantees are related to certain indebtedness of the Company which was
assumed by Mr. Hendricks. The maximum amount of such guarantees and letters of
credit at any time during the past three years occurred in October 2001 and
aggregated $6.7 million.

     Patriot, an insurance captive owned by Mr. and Mrs. Hendricks, provides
certain insurance coverage to the Company, as well as third party companies,
which is subsequently reinsured in part by third-party insurance carriers. APIA,
also owned by Mr. and Mrs. Hendricks, serves as a broker with respect to
insurance coverage for the Company and the Related Entities. The Company paid
APIA, net of reimbursements, $17.1 million, $14.8 million and $12.8 million in
2002, 2001 and 2000, respectively, for claim liabilities, as determined by an
independent actuarial service.

     During 1997, the Company entered into an employment agreement (Employment
Agreement) with Mr. Hendricks which provided for an annual salary of $1.0
million, subject to annual increases if approved by a majority of ABC's
independent directors, of up to 20.0% of his salary in the preceding year. His
Employment Agreement automatically renews unless ABC or Mr. Hendricks otherwise
elect.

     The Company has entered into a Tax Allocation Agreement with Mr. Hendricks
pursuant to which he will receive distributions from each of the Company and its
wholly owned subsidiaries with respect to taxes payable by Mr. Hendricks
associated with the operations of each entity.

                                       14

<PAGE>

ITEM 14.  CONTROLS AND PROCEDURES

     Within the 90 days prior to the date of this report, the Company carried
out an evaluation, under the supervision and with the participation of the
Company's management, including the Company's Chief Executive Officer and the
Chief Financial Officer, of the effectiveness of the design and operation of the
Company's disclosure controls and procedures pursuant to the Exchange Act Rules
13a-14. Based upon that evaluation, the Chief Executive Officer and Chief
Financial Officer concluded that the Company's disclosure controls and
procedures are effective in timely alerting them to material information
relating to the Company (including its consolidated subsidiaries) required to be
included in the Company's periodic SEC filings.

                                       15

<PAGE>

                                     PART IV

ITEM 15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a) (1.) FINANCIAL STATEMENTS

AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.

<TABLE>
<CAPTION>
                                                                                                            Page
                                                                                                            ----
<S>                                                                                                         <C>
 Report of Ernst & Young LLP, Independent Auditors                                                           17
 Consolidated Balance Sheets as of December 31, 2002 and 2001                                                18
 Consolidated Statements of Earnings for the years ended December 31, 2002, 2001 and 2000                    19
 Consolidated Statements of Stockholder's Equity for the years ended December 31, 2002, 2001 and 2000        20
 Consolidated Statements of Cash Flows for the years ended December 31, 2002, 2001 and 2000                  21
 Notes to Consolidated Financial Statements                                                                  22
</TABLE>

     (2.) FINANCIAL STATEMENT SCHEDULE

     Schedule II - Valuation and Qualifying Accounts

     All other schedules for which provision is made in the applicable
accounting regulation of the Securities and Exchange Commission are not required
under the related instructions or are not applicable and, therefore, have been
omitted.

     (3.) LISTING OF EXHIBITS

     See Exhibit Index submitted as a separate section of this report.

(b)  CURRENT REPORTS ON FORM 8-K

     During the quarter ended December 31, 2002, the Company had no current
filings on Form 8-K.

(c)  EXHIBITS

     See Exhibit Index submitted as a separate section of this report.

                                       16

<PAGE>

                REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS

The Board of Directors
American Builders & Contractors Supply Co., Inc.

     We have audited the accompanying consolidated balance sheets of American
Builders & Contractors Supply Co., Inc., and subsidiaries (the Company) as of
December 31, 2002 and 2001, and the related consolidated statements of earnings,
stockholder's equity and cash flows for each of the three years in the period
ended December 31, 2002. Our audits also included the financial statement
schedule listed in the index at Item 15(a). These financial statements and
schedule are the responsibility of the Company's management. Our responsibility
is to express an opinion on these financial statements and schedule based on our
audits.

     We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

     In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of the Company at
December 31, 2002 and 2001, and the consolidated results of its operations and
its cash flows for each of the three years in the period ended December 31,
2002, in conformity with accounting principles generally accepted in the United
States. Also, in our opinion, the related financial statement schedule, when
considered in relation to the basic financial statements taken as a whole,
presents fairly in all material respects the information set forth therein.

     As discussed in Note 7 to the financial statements, effective January 1,
2002, the Company changed its method of accounting for goodwill.

Milwaukee, Wisconsin
February 28, 2003

                                       17

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
                           CONSOLIDATED BALANCE SHEETS
               (in thousands, except per share and share amounts)

<TABLE>
<CAPTION>
                                                                                           December 31,
                                                                                        2002           2001
                                                                                     -------------------------
<S>                                                                                  <C>             <C>
 Assets (Note 3)
 Current assets:
      Cash                                                                           $   6,801       $   6,114
      Accounts receivable, less allowance for doubtful accounts of $9,245--
         2002 and $7,595--2001                                                         209,813         167,253
      Inventories                                                                      191,049         157,810
      Prepaid expenses and other                                                         3,188           3,017
                                                                                     -------------------------
           Total current assets                                                        410,851         334,194
 Property and equipment, net (Note 4)                                                   90,875          66,965
 Receivable from affiliates (Note 6)                                                    15,692           4,907
 Goodwill                                                                               38,851          36,551
 Other intangible assets, net (Note 7)                                                   4,534           4,875
 Security deposits                                                                       1,011             796
 Other assets                                                                              826           1,345
                                                                                     -------------------------
                                                                                     $ 562,640       $ 449,633
                                                                                     =========================
 Liabilities and stockholder's equity
 Current liabilities:
      Accounts payable                                                               $ 119,941       $  99,646
      Accrued payroll and benefits                                                      15,586          12,569
      Accrued liabilities                                                               19,864          15,082
      Current portion of long-term debt (Note 3)                                         8,721          10,245
                                                                                     -------------------------
           Total current liabilities                                                   164,112         137,542
 Long-term debt (Note 3)                                                               296,857         236,929
 Commitments and contingent liabilities (Notes 5, 6 and 8)
 Stockholder's equity:
      Common stock $0.01 par value; 1,000 shares authorized, 147.04 shares
         issued and outstanding                                                              -               -
      Additional paid-in capital                                                         3,779           3,779
      Retained earnings                                                                 97,892          71,383
                                                                                     -------------------------
           Total stockholder's equity                                                  101,671          75,162
                                                                                     -------------------------
                                                                                     $ 562,640       $ 449,633
                                                                                     =========================
</TABLE>

                             See accompanying notes.

                                       18

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
                       CONSOLIDATED STATEMENTS OF EARNINGS
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                  Year Ended December 31,
                                                           2002             2001            2000
                                                        -------------------------------------------
<S>                                                     <C>              <C>             <C>
 Net sales                                              $1,424,705       $1,381,530      $1,238,937
 Cost of sales                                           1,055,093        1,037,192         936,627
                                                        -------------------------------------------
 Gross profit                                              369,612          344,338         302,310

 Operating expenses                                        312,770          280,647         262,719
 Amortization of intangible assets                             369            1,611           1,601
                                                        -------------------------------------------
                                                           313,139          282,258         264,320
                                                        -------------------------------------------
 Operating income                                           56,473           62,080          37,990
 Other income (expense):
      Interest income                                          644              365             340
      Interest expense                                     (15,027)         (19,344)        (25,033)
                                                        -------------------------------------------
                                                           (14,383)         (18,979)        (24,693)
                                                        -------------------------------------------
 Income before provision for income taxes
        and extraordinary item                              42,090           43,101          13,297
 Provision for income taxes                                    981              865             280
                                                        -------------------------------------------
 Income before extraordinary item                           41,109           42,236          13,017
 Extraordinary item (Note 3)                                     -                -           1,043
                                                        -------------------------------------------
 Net income                                             $   41,109       $   42,236      $   14,060
                                                        ===========================================
</TABLE>

                             See accompanying notes.

                                       19

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
                 CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY
                                 (in thousands)

<TABLE>
<CAPTION>
                                               Common           Additional           Retained          Total Stock-
                                                Stock        Paid-in Capital         Earnings        holder's Equity
                                           -------------------------------------------------------------------------
<S>                                        <C>             <C>                  <C>                  <C>
Balance at December 31, 1999                       $   -         $  3,779             $  23,895         $     27,674
Net income                                             -                -                14,060               14,060
Distributions to stockholder                           -                -                (2,556)              (2,556)
                                           -------------------------------------------------------------------------
Balance at December 31, 2000                           -            3,779                35,399               39,178
Net income                                             -                -                42,236               42,236
Distributions to stockholder                           -                -                (6,252)              (6,252)
                                           -------------------------------------------------------------------------
Balance at December 31, 2001                           -            3,779                71,383               75,162
Net income                                             -                -                41,109               41,109
Distributions to stockholder                           -                -               (14,600)             (14,600)
                                           -------------------------------------------------------------------------
Balance at December 31, 2002                        $  -         $  3,779             $  97,892         $    101,671
                                           =========================================================================
</TABLE>

                             See accompanying notes.

                                       20

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                                    Year Ended December 31,
                                                                              2002          2001           2000
                                                                        ---------------------------------------------
<S>                                                                     <C>              <C>           <C>
Operating activities
Net income                                                                $ 41,109       $ 42,236      $ 14,060
Adjustments to reconcile net income to cash
   provided by operating activities:
     Depreciation                                                           15,152         15,302        14,637
     Amortization                                                              369          1,611         1,601
     Amortization of deferred financing costs                                  315            623           360
     Provision for doubtful accounts                                        11,190          8,116         7,323
     Loss on disposal of property and equipment                                372            308         1,115
     Extraordinary item                                                          -              -        (1,043)
     Changes in operating assets and liabilities, net of acquisitions:
          Accounts receivable                                              (10,898)       (30,909)       (5,009)
          Inventories                                                      (11,832)        (3,478)      (14,949)
          Prepaid expenses and other                                            60           (117)          811
          Security deposits                                                    (56)            73          (129)
          Other assets                                                         519            159           272
          Accounts payable                                                   5,670         21,012        (3,863)
          Accrued liabilities                                                4,072          5,646          (400)
                                                                       ---------------------------------------------
               Cash provided by operating activities                        56,042         60,582        14,786

Investing activities
Additions to property and equipment                                        (26,514)       (15,757)      (15,895)
Proceeds from disposal of property and equipment                               693            855         1,733
Acquisitions of businesses                                                 (58,261)        (5,494)       (2,495)
                                                                       ---------------------------------------------
               Cash used in investing activities                           (84,082)       (20,396)      (16,657)

Financing activities
Net borrowings (payments) under line of credit                              39,475        (15,300)       14,578
Proceeds from long-term debt                                                21,000          1,388             -
Payments on long-term debt                                                  (6,020)       (17,461)      (11,727)
Net change in receivable from affiliates                                   (10,785)        (1,456)        1,868
Distributions to stockholder                                               (14,600)        (6,252)       (2,556)
Deferred financing costs                                                      (343)             -             -
                                                                       ---------------------------------------------
               Cash provided by (used in) financing activities              28,727        (39,081)        2,163
                                                                       ---------------------------------------------
Net increase in cash                                                           687          1,105           292
               Cash at beginning of year                                     6,114          5,009         4,717
                                                                       ---------------------------------------------
               Cash at end of year                                        $  6,801       $  6,114      $  5,009
                                                                       =============================================

Supplemental disclosures of cash flows information are as follows:
     Cash paid for interest                                               $ 14,590       $ 19,424      $ 24,744
     Cash paid for income taxes                                                931            565           280
</TABLE>

                             See accompanying notes.

                                       21

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                December 31, 2002

1. Nature of Business and Summary of Significant Accounting Policies

     Nature of Business

     The accompanying consolidated financial statements include the accounts of
American Builders & Contractors Supply Co., Inc. (ABC) and its wholly owned
subsidiaries (collectively, the Company). All significant intercompany profits,
transactions, and balances have been eliminated in consolidation.

     The Company is primarily engaged in the sale of roofing and siding products
throughout the United States. There were 256, 215 and 200 distribution center
locations at December 31, 2002, 2001 and 2000, respectively.

     Accounts Receivable

     The Company evaluates the collectibility of its accounts receivable based
on a number of factors. For larger accounts greater than 90 days past due, an
allowance for doubtful accounts is recorded based on a customer's ability and
likelihood to pay based on management's review of the facts. A weighted average
of these evaluations is applied to all smaller accounts greater than 90 days
past due. For all other customers, the Company recognizes an allowance based on
length of time the receivable is past due based on historical experience.

     Inventories

     Inventories, which consist primarily of purchased roofing and siding
products, are stated at the lower of cost (average cost basis) or market.

     Property and Equipment

     Property and equipment additions are capitalized at cost. Depreciation on
these assets is calculated using the straight-line method over the estimated
useful lives of the related assets or, in the case of leasehold improvements,
the life of the lease if shorter. Estimated useful lives are as follows:

       Buildings and improvements            31 - 39 years
       Aircraft                                   20 years
       Vehicles                               2 -  5 years
       Warehouse equipment                    5 - 15 years
       Office furniture and equipment         3 -  7 years
       Leasehold improvements                Life of the lease, maximum 10 years

     Goodwill

     Effective January 1, 2002, goodwill is no longer amortized but is reviewed
for impairment on an annual basis. Prior to January 1, 2002, goodwill was
amortized over 25 to 35 years using the straight-line method. Accumulated
amortization of goodwill is approximately $5,682,000.

     Other Intangible Assets

     Other intangible assets include noncompete agreements and deferred
financing costs which are amortized over the term of the respective agreements
or loans (ranging from 3 to 15 years).

                                       22

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

1. Nature of Business and Summary of Significant Accounting Policies (continued)

     Impairment of Long-Lived Assets

     Property and equipment and other intangible assets are reviewed for
impairment whenever events or changes in circumstances indicate that the
carrying amount may not be recoverable. If the sum of the expected undiscounted
cash flows is less than the carrying value of the related asset or group of
assets, a loss is recognized for the difference between the fair value and
carrying value of the asset or group of assets. Such analyses necessarily
involve significant judgment.

     Revenue Recognition

     The Company recognizes revenue upon delivery of product and transfer of
title to the customer, which typically occurs at the Company's distribution
center locations.

     Late Payment Charges

     Late payment charges are recorded in connection with past due receivable
balances and are classified as a reduction to operating expenses. Late payment
charges were approximately $5,389,000, $5,225,000 and $4,112,000 in 2002, 2001
and 2000, respectively.

     Shipping and Handling Costs

     The Company classifies shipping and handling costs, consisting of driver
wages and vehicle expenses, as operating expenses in the accompanying
consolidated statements of earnings. Shipping and handling costs were
approximately $66,151,000, $66,021,000 and $59,972,000 for 2002, 2001 and 2000,
respectively.

     Advertising Costs

     Advertising costs are expensed in the period incurred. Total advertising
expense was approximately $5,486,000, $4,869,000 and $4,761,000 for 2002, 2001
and 2000, respectively.

     Income Taxes

     ABC and its subsidiaries have elected to be treated as Subchapter S
Corporations for federal and state income tax purposes. As a result, the
Company's stockholder includes the taxable income of ABC and its subsidiaries in
his personal income tax returns. Accordingly, with the exception of the amounts
described in the following paragraph, the accompanying consolidated financial
statements include no provision or liability for income taxes.

     Certain states impose a corporate state tax on earnings of a Subchapter S
Corporation. Provisions of approximately $981,000, $865,000 and $280,000 have
been made for such income taxes in 2002, 2001 and 2000, respectively.

     Net income differs from the amount currently taxable to the Company's
stockholder due to certain items which are reported differently for financial
reporting purposes than for income tax purposes, principally inventory costs
capitalized, bad debts, depreciation and amortization.

                                       23

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

1. Nature of Business and Summary of Significant Accounting Policies (continued)

     Use of Estimates

     The preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires management to make
estimates and assumptions that affect the amounts reported in the financial
statements and accompanying notes. Actual results could differ from those
estimates.

     New Accounting Standards

     In August 2002, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets," which addresses financial
accounting and reporting for the impairment of long-lived assets and for
long-lived assets to be disposed of, as well as the accounting and reporting of
discontinued operations. The Company adopted SFAS No. 144 effective January 1,
2002, and the adoption of SFAS No. 144 did not have a significant impact on the
Company's results of operations, financial position or cash flows.

     In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statements
No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical
Corrections." SFAS No. 145 rescinds SFAS No. 4, "Reporting Gains and Losses from
Extinguishment of Debt." Any gain or loss on the extinguishment of debt that was
classified as an extraordinary item in prior periods that does not meet specific
criteria for classification as an extraordinary item shall be reclassified. The
provisions of SFAS No. 145, related to the rescission of SFAS No. 4, will be
adopted by the Company effective January 1, 2003.

     In July 2002, the FASB issued SFAS No. 146, "Accounting for Costs
Associated with Exit or Disposal Activities." SFAS No. 146 requires companies to
recognize costs associated with exit or disposal activities when they are
incurred rather than at the date of a commitment to an exit or a disposal plan.
Examples of costs covered by SFAS No. 146 include lease termination costs and
certain employee severance costs that are associated with a restructuring,
discontinued operation, plant closing, or other exit or disposal activity. SFAS
No. 146 is to be applied prospectively to exit or disposal activities initiated
after December 31, 2002. The Company does not expect that the adoption of SFAS
No. 146 will have a significant impact on the Company's results of operations,
financial position or cash flows.

     In November 2002, the FASB issued Interpretation No. 45, "Guarantor's
Accounting and Disclosure Requirements for Guarantees, Including Indirect
Guarantees of Indebtedness of Others," (the Interpretation) which expands on the
guidance for the accounting and disclosure of guarantees. Each guarantee meeting
the characteristics described in the Interpretation is to be recognized and
initially measured at fair value. In addition, guarantors will be required to
make significant new disclosures, even if the likelihood of the guarantor making
payments under the guarantee is remote, which represents another change from
general current practice. The Interpretation's disclosure requirements are
effective for financial statements ending after December 15, 2002, while the
initial recognition and initial measurement provisions are applicable on a
prospective basis to guarantees issued or modified after December 31, 2002. The
Company is currently evaluating the requirements and impact of this
Interpretation on the Company's financial position and results of operations.

                                       24

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

2. Business Acquisitions

     The following business acquisitions have been accounted for using the
purchase method. Operations of such acquisitions are included in the Company's
consolidated financial statements from the respective dates of acquisition.

2002 Acquisitions

     On December 16, 2002, the Company acquired certain assets consisting mainly
of inventories, accounts receivable, real estate and equipment, and assumed
certain liabilities from twenty-nine distribution centers of Wm. Cameron & Co.
for a total net purchase price of approximately $54,500,000 of which,
approximately $51,800,000 was paid at closing and the remaining is due in the
first quarter of 2003. These Wm. Cameron & Co. locations were engaged primarily
in the wholesale distribution of residential roofing, siding and window products
to customers located in Maryland, Virginia, the District of Columbia, Colorado,
Arizona, Utah, New Mexico, Oregon and California. The excess of cost over the
fair value of the net assets acquired is approximately $2,300,000.

     During 2002, the Company made five other relatively small acquisitions with
an aggregate cost of approximately $6,500,000. The cost of each of these
acquisitions approximated the fair value of the net assets acquired.

2001 Acquisitions

     In October 2001, the Company formed two new wholly owned subsidiaries,
Vande Hey Raleigh Roof Tile Manufacturing, Inc. and Vande Hey Roof Tile
Installation, Inc. These companies acquired certain assets and assumed certain
liabilities of a roof tile manufacturer and a related installation company for
approximately $3,800,000, which includes a $1,000,000 note to the sellers.

     In December 2001, the Company purchased certain assets and assumed certain
liabilities of Jim Houk Seamless Guttering and Supply, Inc., which was in the
business of manufacturing and distributing gutter supplies and accessories in
the Missouri, Oklahoma and Kansas markets, for approximately $2,600,000.

     The cost of each of these acquisitions approximated the fair value of the
net assets acquired.

     Unaudited pro forma financial information for the acquisitions in 2002 and
2001 is not presented because these acquisitions are not significant to the
Company's results of operations.

2000 Acquisitions

     On December 31, 2000, the Company acquired certain assets and assumed
certain liabilities of Central Building Supply, Inc. (Central) for a purchase
price of approximately $2,200,000. Central was engaged primarily in the
wholesale distribution of siding material and accessories in the Maryland
market. The Company made one other acquisition of assets during the year with a
purchase price of approximately $300,000. The cost of both acquisitions
approximated the fair value of the net assets acquired.

                                       25

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

3. Long-Term Debt

     Long-term debt consists of the following:

                                                         December 31,
                                                    2002             2001
                                                ---------------------------
                                                        (in thousands)

          Revolving line of credit                $ 196,688       $ 157,213
          Senior Subordinated Notes                  63,650          63,650
          Equipment loans                            36,725          20,166
          Mortgage                                    4,734           6,145
          Aircraft loan                               3,781               -
                                                ---------------------------
                                                    305,578         247,174
          Less current maturities                     8,721          10,245
                                                ---------------------------
                                                  $ 296,857       $ 236,929
                                                ===========================

     The Company has a financing agreement with a group of banks (Revolver)
under which the Company may borrow, on a revolving credit basis, up to a maximum
of $275,000,000, reduced by outstanding letters of credit. As amended March 21,
2002, the initial term of the Revolver expires on June 30, 2005, but shall
automatically extend for successive one-year periods, unless written notice of
termination is given by either party at least sixty days prior to the end of a
period. At December 31, 2002, the Company had $62,836,000 of availability under
the Revolver. The average availability during 2002 was approximately $68,185,000
based on a percentage of eligible accounts receivable and inventories. Under the
amended terms of the Revolver, borrowings bear interest, at the Company's
option, at LIBOR plus 1.75% or at a base rate, as defined, plus 0.50%. The
weighted average interest rate on all borrowings outstanding under the Revolver
at each of December 31, 2002 and 2001 was 3.3%.

     The Company's 10 5/8% Senior Subordinated Notes are due in 2007. During
2001 and 2000, the Company repurchased and retired $15,450,000 and $11,550,000
of the Senior Subordinated Notes, respectively. The difference between par value
of the Senior Subordinated Notes repurchased in 2001 and the repurchase price,
net of expenses and the applicable portion of the unamortized deferred financing
fees written off, was not material. The notes repurchased in 2000 resulted in an
extraordinary gain of $1,043,000 net of the write-off of the applicable portion
of the unamortized deferred financing costs and other expenses. Funds used to
repurchase the Senior Subordinated Notes were obtained primarily from borrowings
under the Revolver.

     The Revolver and Senior Subordinated Notes contain various covenants,
including, among other things, provisions that place restrictions on ABC's
ability to merge or sell its business, repurchase stock, or pay dividends.
Additional provisions of the Revolver require the Company to maintain specific
fixed charge coverage and leverage ratios, and also requires that the Company's
stockholder continue to own at least 51% of the Company's common stock.

     In 2002, the Company secured three promissory notes collateralized by
specific equipment (delivery trucks, trailers and forklifts). The first note
with an initial principal balance of $10,000,000 requires monthly installments
of approximately $167,000 plus interest through October 2006, with a final
payment of $2,000,000 due in November 2006. The note bears interest at LIBOR
plus 2.3%. The remaining notes entered into during 2002 total $11,000,000 of
initial principal. These notes require monthly installments of approximately
$183,000 plus interest through November 2006, with final principal payments due
in December 2006. These notes bear interest at General Electric Capital
Corporation's 30-day commercial paper rate plus 2.35%.

                                       26

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

3. Long-Term Debt (continued)

     In 2002, the Company refinanced its mortgage on its corporate office with a
$4,800,000 note. The note requires monthly principal payments of approximately
$13,000 plus interest through July 2007, with a final payment due in August
2007. The note bears interest at the lower of LIBOR plus 2.0% or the lender's
prime rate, as defined in the note.

     In addition, in 2002, the Company purchased and financed an aircraft with a
loan of approximately $3,949,000. The loan requires scheduled average monthly
principal payments of approximately $23,000, plus interest through March 2007,
with a final payment in April 2007. The loan bears interest at LIBOR plus 2.2%.

     In 2001, the Company refinanced its previous equipment loans with a
$20,500,000 note, collateralized by specific equipment (delivery trucks,
trailers and forklifts). The note requires monthly principal payments of
$342,000 plus interest through October 2005, with a final payment in November
2005. The note bears interest at 6.45%.

     Substantially all of the Company's assets are collateral for the Company's
indebtedness. Future maturities of long-term debt as of December 31, 2002, are
as follows (in thousands):

              Year ending December 31,

                       2003                                      $  8,721
                       2004                                         8,732
                       2005                                       209,190
                       2006                                         8,521
                       2007                                        70,414
                                                               -------------
                                                                 $305,578
                                                               =============

4. Property and Equipment

     Property and equipment consists of the following:

                                                        December 31,
                                                     2002           2001
                                              -----------------------------
                                                       (in thousands)

           Land                                   $  4,966       $  3,556
           Buildings and improvements               15,760         13,598
           Aircraft                                  4,433              -
           Warehouse equipment                      15,971         13,745
           Vehicles                                 99,300         79,430
           Office furniture and equipment           13,824         12,920
           Leasehold improvements                   19,962         17,876
                                              -----------------------------
                                                   174,216        141,125
           Less accumulated depreciation            83,341         74,160
                                              -----------------------------
                                                  $ 90,875       $ 66,965
                                              =============================

5. Lease Commitments

     The Company conducts the majority of its operations in leased facilities
under operating leases expiring at various dates through 2012. Generally, the
leases provide that the Company pays all insurance, maintenance, and other costs
and expenses associated with use of the buildings. Some of the leases also
require the Company to pay real estate taxes.

                                       27

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

5. Lease Commitments (continued)

     As of December 31, 2002, the real estate for 119 of the distribution
centers was owned by a related party. The total rent expense for these
related-party leases was approximately $14,200,000, $12,532,000 and $11,742,000
for the years ended December 31, 2002, 2001 and 2000, respectively.

     Rent expense under all leases totaled $25,015,000, $21,884,000 and
$20,516,000 for the years ended December 31, 2002, 2001 and 2000, respectively.
Future minimum rental payments required as of December 31, 2002, under all
leases with initial or remaining terms of more than one year are as follows (in
thousands):

             Year ending December 31,
                      2003                              $ 26,820
                      2004                                23,178
                      2005                                20,385
                      2006                                18,301
                      2007                                16,143
                      Thereafter                          19,964
                                                  --------------
                                                       $ 124,791
                                                  ==============

6. Related-Party Transactions

     The Company is related to certain other affiliates by common ownership and
management. Transactions and balances with these entities are as follows at
December 31 or for the years ended December 31:

                                         2002     2001     2000
                                      ----------------------------
                                                  (in thousands)

           Accounts receivable        $    96  $    76   $    58
           Security deposits              323      314       314
           Sales                          215      211       120
           Purchases                    4,164    1,802     2,257
           Rent expense                14,200   12,532    11,742
           Interest income                613      329       300

     The noncurrent receivable from affiliates on the accompanying consolidated
balance sheets primarily represents advances to an affiliate to purchase real
estate to be used by the Company. Interest on the receivable from affiliates is
charged at a rate comparable to the interest rate the Company pays on its
Revolver.

     At December 31, 2002 and 2001, the Company had guaranteed debt of the
stockholder in the amounts of approximately $1,264,000 and $1,602,000,
respectively. Certain assets owned by the Company serve as collateral as part of
an overall guaranty of this debt by the Company. The Company also had
outstanding letters of credit of approximately $5,064,000 at December 31, 2002
and 2001 with respect to debt of the stockholder and affiliates.

     An insurance captive, owned by the stockholder and his spouse, provides
certain insurance coverage to the Company, which is subsequently reinsured in
part by third-party insurance carriers. The Company paid an insurance broker,
also owned by the stockholder and his spouse, net of reimbursements,
approximately $17,077,000, $14,782,000 and $12,832,000 in 2002, 2001 and 2000,
respectively, for claim liabilities, as determined by an independent actuarial
service. The Company has a $5,000,000 letter of credit outstanding at December
31, 2002 and 2001 with respect to its potential exposure under certain coverages
provided by the affiliated insurance captive.

                                       28

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

7. Goodwill and Other Intangible Assets

     The Company adopted SFAS No. 142, "Goodwill and Other Intangible Assets,"
as of January 1, 2002. In connection with the adoption of SFAS No. 142, the
Company completed the first step of the transitional goodwill impairment test,
which required the Company to compare the fair value of its reporting units to
the carrying value of the net assets of the respective reporting units as of
January 1, 2002. Based on this analysis, the Company has concluded that no
impairment existed at the time of adoption, or at the time of the annual
impairment test performed at December 31, 2002, and, accordingly, no impairment
charge has been recorded.

     The gross carrying value and accumulated amortization by major class of
other intangible assets are as follows (in thousands):

<TABLE>
<CAPTION>
                                         December 31, 2002                          December 31, 2001
                               --------------------------------------   --------------------------------------
                                 Gross Carrying      Accumulated           Gross Carrying       Accumulated
                                     Amount          Amortization              Amount          Amortization
                               --------------------------------------   --------------------------------------
<S>                                 <C>                <C>                    <C>                 <C>
Non-compete agreements              $4,650             $1,752                 $4,650              $1,410
Deferred financing costs             4,165              2,898                  3,933               2,694
Other                                  400                 31                    400                   4
                               --------------------------------------   --------------------------------------
                                    $9,215             $4,681                 $8,983              $4,108
                               ======================================   ======================================
</TABLE>

     The Company does not have any intangible assets deemed to have indefinite
lives. Amortization expense expected to be recognized for each of the next five
years ending December 31, is as follows (in thousands):

                            2003                  $ 740
                            2004                    740
                            2005                    679
                            2006                    593
                            2007                    447

     As required by SFAS No. 142, the results of operations for periods prior to
its adoption have not been restated. Had these provisions been adopted effective
January 1, 2000, the proforma net income would have been $43,532,000 and
$15,356,000 for the years ended December 31, 2001 and 2000, respectively.

8. Contingent Liabilities

     The Company is involved in various legal matters arising in the normal
course of business. In the opinion of management the amount of losses that may
be sustained, if any, would not have a material effect on the financial position
and results of operations of the Company.

9. Employee Benefit Plan

     The Company sponsors a 401(k) plan covering substantially all employees.
Contributions, which are at the discretion of the Company, approximated
$1,123,000 in 2002, $527,000 in 2001 and $408,000 in 2000.

                                       29

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

10. Fair Value of Financial Instruments

     The carrying value of cash, accounts receivable, accounts payable and
borrowings under the Revolver, equipment loans and mortgage and aircraft notes
payable approximated fair value at December 31, 2002 and 2000. The value of the
Senior Subordinated Notes, based on quoted market prices, is as follows:

                                        December 31,
                                     2002         2001
                                   ---------------------
                                       (in thousands)

          Par value                $63,650      $63,650
          Fair value                65,560       63,968

     Substantially all of the Company's accounts receivable are due from
contractors located throughout the United States. Credit is extended based on an
evaluation of the customer's financial condition and projects, where applicable,
and collateral is required in certain situations. Credit losses are provided for
in the consolidated financial statements and have consistently been within
management's expectations.

11. Summarized Financial Information about Guarantor Subsidiaries

     The following tables present consolidating financial information for 2002,
2001 and 2000 for: (a) ABC and (b) on a combined basis, the guarantors of the
Senior Subordinated Notes, which include all of the wholly owned subsidiaries of
the Company (Subsidiary Guarantors). Separate financial statements of the
Subsidiary Guarantors are not presented because the guarantors are jointly,
severally and unconditionally liable under the guarantees, and the Company
believes separate financial statements and other disclosures regarding the
Subsidiary Guarantors are not material to investors.

                                       30

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

11. Summarized Financial Information about Guarantor Subsidiaries (continued)

<TABLE>
<CAPTION>
Consolidating Balance Sheet
December 31, 2002
(in thousands)                                                       Subsidiary
                                                         ABC         Guarantors     Eliminations   Consolidated
                                                      --------------------------------------------------------
<S>                                                   <C>            <C>             <C>             <C>
Assets
Current assets:
     Cash                                             $   6,897      $     (96)      $       -       $   6,801
     Accounts receivable, less allowance
       for doubtful accounts                            207,849         11,242          (9,278)        209,813
     Inventories                                        190,971          2,703          (2,625)        191,049
     Intercompany advances                                2,873         (2,873)              -               -
     Prepaid expenses and other                           1,656          1,532               -           3,188
                                                      --------------------------------------------------------
          Total current assets                          410,246         12,508         (11,903)        410,851
Property and equipment, net                              84,491          6,384               -          90,875
Investment in subsidiaries                                4,927              -          (4,927)              -
Receivable from affiliates                               15,692              -               -          15,692
Goodwill                                                 38,851              -               -          38,851
Other intangible assets, net                              4,059            475               -           4,534
Security deposits                                         1,511           (500)              -           1,011
Other assets                                                741             85               -             826
                                                      --------------------------------------------------------
                                                      $ 560,518      $  18,952       $ (16,830)      $ 562,640
                                                      ========================================================
Liabilities and stockholder's equity
Current liabilities:
     Accounts payable                                 $ 124,068      $   5,151       $  (9,278)      $ 119,941
     Accrued payroll and benefits                        14,834            752               -          15,586
     Accrued liabilities                                 18,147          1,717               -          19,864
     Current portion of long-term debt                    8,460            261               -           8,721
                                                      --------------------------------------------------------
          Total current liabilities                     165,509          7,881          (9,278)        164,112
Long-term debt                                          293,338          3,519                         296,857
Commitments and contingent liabilities
Stockholder's equity:
     Common stock                                             -              -               -               -
     Additional paid-in capital                           3,779              1              (1)          3,779
     Retained earnings                                   97,892          7,551          (7,551)         97,892
                                                      --------------------------------------------------------
          Total stockholder's equity                    101,671          7,552          (7,552)        101,671
                                                      --------------------------------------------------------
                                                      $ 560,518      $  18,952       $ (16,830)      $ 562,640
                                                      ========================================================
</TABLE>

                                       31

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

11. Summarized Financial Information about Guarantor Subsidiaries (continued)

<TABLE>
<CAPTION>
Consolidating Balance Sheet
December 31, 2001
(in thousands)                                                           Subsidiary
                                                         ABC             Guarantors        Eliminations      Consolidated
                                                      ------------------------------------------------------------------
<S>                                                  <C>                <C>                <C>                <C>
Assets
Current assets:
     Cash                                             $   6,040          $      74          $       -          $   6,114
     Accounts receivable, less allowance
       for doubtful accounts                            166,746              8,337             (7,830)           167,253
     Inventories                                        158,067              2,183             (2,440)           157,810
     Intercompany advances                               (1,880)             1,880                  -                  -
     Prepaid expenses and other                           2,042                975                  -              3,017
                                                      ------------------------------------------------------------------
          Total current assets                          331,015             13,449            (10,270)           334,194
Property and equipment, net                              65,318              1,647                  -             66,965
Investment in subsidiaries                                4,186                  -             (4,186)                 -
Receivable from affiliates                                4,907                  -                  -              4,907
Goodwill                                                 36,551                  -                  -             36,551
Other intangible assets, net                              4,336                539                  -              4,875
Security deposits                                           796                  -                  -                796
Other assets                                              1,310                 35                  -              1,345
                                                      ------------------------------------------------------------------
                                                      $ 448,419          $  15,670          $ (14,456)         $ 449,633
                                                      ==================================================================
Liabilities and stockholder's equity
Current liabilities:
     Accounts payable                                 $ 100,908          $   6,568          $  (7,830)         $  99,646
     Accrued payroll and benefits                        12,161                408                  -             12,569
     Accrued liabilities                                 14,014              1,068                  -             15,082
     Current portion of long-term debt                    9,245              1,000                  -             10,245
                                                      ------------------------------------------------------------------
          Total current liabilities                     136,328              9,044             (7,830)           137,542
Long-term debt                                          236,929                  -                  -            236,929
Commitments and contingent liabilities
Stockholder's equity:
     Common stock                                             -                  -                  -                  -
     Additional paid-in capital                           3,779                  1                 (1)             3,779
     Retained earnings                                   71,383              6,625             (6,625)            71,383
                                                      ------------------------------------------------------------------
          Total stockholder's equity                     75,162              6,626             (6,626)            75,162
                                                      ------------------------------------------------------------------
                                                      $ 448,419          $  15,670          $ (14,456)         $ 449,633
                                                      ==================================================================
</TABLE>

                                       32

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

11. Summarized Financial Information about Guarantor Subsidiaries (continued)

Consolidating Statement of Earnings
Year Ended December 31, 2002
(in thousands)

<TABLE>
<CAPTION>
                                                            Subsidiary
                                                 ABC        Guarantors    Eliminations   Consolidated
                                            ----------------------------------------------------------
<S>                                         <C>            <C>            <C>            <C>
Net sales                                   $ 1,408,589    $    81,763    $   (65,647)   $ 1,424,705
Cost of sales                                 1,051,013         69,416        (65,336)     1,055,093
                                            ----------------------------------------------------------
Gross profit                                    357,576         12,347           (311)       369,612

Operating expenses                              303,219          9,678           (127)       312,770
Amortization of intangible assets                   305             64              -            369
                                            ----------------------------------------------------------
                                                303,524          9,742           (127)       313,139
                                            ----------------------------------------------------------
Operating income                                 54,052          2,605           (184)        56,473
Other income (expense):
     Interest income                                644              -              -            644
     Interest expense                           (14,866)          (161)             -        (15,027)
                                            ----------------------------------------------------------
                                                (14,222)          (161)             -        (14,383)
                                            ----------------------------------------------------------
Income before provision for income taxes
   and equity in earnings of subsidiaries        39,830          2,444           (184)        42,090
Provision for income taxes                          972              9              -            981
                                            ----------------------------------------------------------
                                                 38,858          2,435           (184)        41,109
Equity in earnings of subsidiaries                2,251              -         (2,251)             -
                                            ----------------------------------------------------------
Net income                                  $    41,109    $     2,435    $    (2,435)   $    41,109
                                            ==========================================================
</TABLE>

                                       33

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

11. Summarized Financial Information about Guarantor Subsidiaries (continued)

Consolidating Statement of Earnings
Year Ended December 31, 2001
(in thousands)

<TABLE>
<CAPTION>
                                                                     Subsidiary
                                                      ABC            Guarantors     Eliminations     Consolidated
                                                  ---------------------------------------------------------------
<S>                                               <C>                <C>            <C>              <C>
 Net sales                                        $  1,377,645       $   61,603      $ (57,718)      $  1,381,530
 Cost of sales                                       1,043,850           50,961        (57,619)         1,037,192
                                                  ---------------------------------------------------------------
 Gross profit                                          333,795           10,642            (99)           344,338

 Operating expenses                                    273,805            6,842              -            280,647
 Amortization of intangible assets                       1,601               10              -              1,611
                                                  ---------------------------------------------------------------
                                                       275,406            6,852              -            282,258
                                                  ---------------------------------------------------------------
 Operating income                                       58,389            3,790            (99)            62,080
 Other income (expense):
      Interest income                                      365                -              -                365
      Interest expense                                 (19,344)               -              -            (19,344)
                                                  ---------------------------------------------------------------
                                                       (18,979)               -              -            (18,979)
                                                  ---------------------------------------------------------------
 Income before provision for income taxes
    and equity in earnings of subsidiaries              39,410            3,790            (99)            43,101
 Provision for income taxes                                856                9              -                865
                                                  ---------------------------------------------------------------
                                                        38,554            3,781            (99)            42,236
 Equity in earnings of subsidiaries                      3,682                -         (3,682)                 -
                                                  ---------------------------------------------------------------
 Net income                                       $     42,236       $    3,781      $  (3,781)      $     42,236
                                                  ===============================================================
</TABLE>

                                       34

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

11. Summarized Financial Information about Guarantor Subsidiaries (continued)

Consolidating Statement of Earnings
Year Ended December 31, 2000

(in thousands)

<TABLE>
<CAPTION>
                                                                  Subsidiary
                                                      ABC         Guarantors    Eliminations      Consolidated
                                               ------------------------------------------------------------------
<S>                                                <C>              <C>           <C>              <C>
Net sales                                         $ 1,236,118      $ 55,874      $ (53,055)       $ 1,238,937
Cost of sales                                         942,862        46,452        (52,687)           936,627
                                              ------------------------------------------------------------------
Gross profit                                          293,256         9,422           (368)           302,310

Operating expenses                                    256,334         6,385              -            262,719
Amortization of intangible assets                       1,601             -              -              1,601
                                              ------------------------------------------------------------------
                                                      257,935         6,385              -            264,320
                                              ------------------------------------------------------------------
Operating income                                       35,321         3,037           (368)            37,990
Other income (expense):
     Interest income                                      340             -              -                340
     Interest expense                                 (25,033)            -              -            (25,033)
                                              ------------------------------------------------------------------
                                                      (24,693)            -              -            (24,693)
                                              ------------------------------------------------------------------
Income before provision for income taxes,
   equity in earnings of subsidiaries and
   extraordinary item                                  10,628         3,037           (368)            13,297
Provision for income taxes                                268            12              -                280
                                              ------------------------------------------------------------------
                                                       10,360         3,025           (368)            13,017
Equity in earnings of subsidiaries                      2,657             -         (2,657)                 -
                                              ------------------------------------------------------------------
Income before extraordinary item                       13,017         3,025         (3,025)            13,017
Extraordinary item                                      1,043             -              -              1,043
                                              ------------------------------------------------------------------
Net income                                        $    14,060      $  3,025      $  (3,025)       $    14,060
                                              ==================================================================
</TABLE>

                                       35

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

11. Summarized Financial Information about Guarantor Subsidiaries (continued)

Consolidating Statement of Cash Flows
Year Ended December 31, 2002
(in thousands)

<TABLE>
<CAPTION>
                                                                                   Subsidiary
                                                                         ABC       Guarantors    Eliminations  Consolidated
                                                                     ---------------------------------------------------------
<S>                                                                    <C>           <C>           <C>           <C>
Operating activities
Net income                                                             $ 41,109      $  2,435      $ (2,435)     $ 41,109
Adjustments to reconcile net income to cash provided
  by operating activities:
    Depreciation                                                         14,561           591             -        15,152
    Amortization                                                            305            64             -           369
    Amortization of deferred financing costs                                315             -             -           315
    Provision for doubtful accounts                                      11,190             -             -        11,190
    Loss on disposal of property and equipment                              367             5             -           372
    Changes in operating assets and liabilities:
        Accounts receivable                                              (9,441)       (2,906)        1,449       (10,898)
        Inventories                                                     (11,496)         (520)          184       (11,832)
        Prepaid expenses and other                                          617          (557)            -            60
        Security deposits                                                  (556)          500             -           (56)
        Other assets                                                     (4,185)        4,704             -           519
        Accounts payable                                                  8,536        (1,417)       (1,449)        5,670
        Accrued liabilities                                               3,079           993             -         4,072
                                                                     ---------------------------------------------------------
            Cash provided by operating activities                        54,401         3,892        (2,251)       56,042

Investing activities
Additions to property and equipment                                     (25,097)       (1,417)            -       (26,514)
Proceeds from disposal of property and
  equipment                                                                 660            33             -           693
Acquisitions of businesses                                              (58,261)            -             -       (58,261)
Investment in subsidiaries                                               (2,251)            -         2,251             -
                                                                     ---------------------------------------------------------
            Cash used in investing activities                           (84,949)       (1,384)        2,251       (84,082)

Financing activities
Net borrowings under line of credit                                      39,475             -             -        39,475
Proceeds from long-term debt                                             21,000             -             -        21,000
Payments on long-term debt                                               (4,851)       (1,169)            -        (6,020)
Net change in receivable from affiliates                                (10,785)            -             -       (10,785)
Distributions to stockholder                                            (13,091)       (1,509)            -       (14,600)
Deferred financing costs                                                   (343)            -             -          (343)
                                                                     ---------------------------------------------------------
            Cash provided by (used in) financing activities              31,405        (2,678)            -        28,727
                                                                     ---------------------------------------------------------
Net increase (decrease) in cash                                             857          (170)            -           687
            Cash at beginning of year                                     6,040            74             -         6,114
                                                                     ---------------------------------------------------------
            Cash at end of year                                        $  6,897      $    (96)     $      -      $  6,801
                                                                     =========================================================

Supplemental disclosures of cash flows
  information are as follows:
            Cash paid for interest                                     $ 14,429      $    161      $      -      $ 14,590
            Cash paid for income taxes                                      922             9             -           931
</TABLE>

                                       36

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

  11. Summarized Financial Information about Guarantor Subsidiaries (continued)

Consolidating Statement of Cash Flows
Year Ended December 31, 2001
(in thousands)

<TABLE>
<CAPTION>
                                                                          Subsidiary
                                                                ABC       Guarantors     Eliminations    Consolidated
                                                            ---------------------------------------------------------
<S>                                                         <C>           <C>            <C>             <C>
Operating activities
Net income                                                  $   42,236    $    3,781     $     (3,781)   $     42,236
Adjustments to reconcile net income to cash provided
  by operating activities:
    Depreciation                                                15,045           257                -          15,302
    Amortization                                                 1,601            10                -           1,611
    Amortization of deferred financing costs                       623             -                -             623
    Provision for doubtful accounts                              8,116             -                -           8,116
    Loss on disposal of property and equipment                     302             6                -             308
    Changes in operating assets and liabilities:
        Accounts receivable                                    (31,661)         (269)           1,021         (30,909)
        Inventories                                             (3,807)          230               99          (3,478)
        Prepaid expenses and other                                (129)           12                -            (117)
        Security deposits                                           73             -                -              73
        Other assets                                            (2,476)        2,635                -             159
        Accounts payable                                        21,795           238           (1,021)         21,012
        Accrued liabilities                                      5,462           184                -           5,646
                                                            ---------------------------------------------------------
            Cash provided by operating activities               57,180         7,084           (3,682)         60,582

Investing activities
Additions to property and equipment                            (15,449)         (308)               -         (15,757)
Proceeds from disposal of property and
   equipment                                                       835            20                -             855
Acquisitions of businesses                                      (2,692)       (2,802)               -          (5,494)
Investment in subsidiaries                                      (3,682)            -            3,682               -
                                                            ---------------------------------------------------------
            Cash used in investing activities                  (20,988)       (3,090)           3,682         (20,396)

Financing activities
Net payments under line of credit                              (15,300)            -                -         (15,300)
Proceeds from long-term debt                                     1,388             -                -           1,388
Payments on long-term debt                                     (17,461)            -                -         (17,461)
Net change in receivable from affiliates                        (1,456)            -                -          (1,456)
Distributions to stockholder                                    (1,974)       (4,278)               -          (6,252)
                                                            ---------------------------------------------------------
            Cash used in financing activities                  (34,803)       (4,278)               -         (39,031)
                                                            ---------------------------------------------------------
Net increase (decrease) in cash                                  1,389          (284)               -           1,105
            Cash at beginning of year                            4,651           358                -           5,009
                                                            ---------------------------------------------------------
            Cash at end of year                             $    6,040    $       74     $          -    $      6,114
                                                            =========================================================

Supplemental disclosures of cash flows
   information are as follows:
        Cash paid for interest                              $   19,424    $        -     $          -    $     19,424
        Cash paid for income taxes                                 556             9                -             565
</TABLE>

                                       37

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

11. Summarized Financial Information about Guarantor Subsidiaries (continued)

Consolidating Statement of Cash Flows
Year Ended December 31, 2000
(in thousands)

<TABLE>
<CAPTION>
                                                                                   Subsidiary
                                                                         ABC       Guarantors    Eliminations  Consolidated
                                                                     -------------------------------------------------------
<S>                                                                    <C>           <C>           <C>           <C>

Operating activities
Net income                                                           $   14,060   $   3,025     $   (3,025)     $  14,060
Adjustments to reconcile net income to cash provided
  by operating activities:
    Depreciation                                                         14,402         235              -         14,637
    Amortization                                                          1,601           -              -          1,601
    Amortization of deferred financing costs                                360           -              -            360
    Provision for doubtful accounts                                       7,323           -              -          7,323
    Loss on disposal of property and equipment                            1,089          26              -          1,115
    Extraordinary item                                                   (1,043)          -              -         (1,043)
    Changes in operating assets and liabilities:
        Accounts receivable                                              (4,983)         45            (71)        (5,009)
        Inventories                                                     (15,500)        183            368        (14,949)
        Prepaid expenses and other                                          547         264              -            811
        Security deposits                                                  (129)          -              -           (129)
        Other assets                                                      6,273      (4,454)        (1,547)           272
        Accounts payable                                                 (6,307)      2,373             71         (3,863)
        Accrued liabilities                                                (647)        247              -           (400)
                                                                     -------------------------------------------------------
            Cash provided by operating activities                        17,046       1,944         (4,204)        14,786

Investing activities
Additions to property and equipment                                     (15,752)       (143)             -        (15,895)
Proceeds from disposal of property and
   equipment                                                              1,698          35              -          1,733
Acquisitions of businesses                                               (2,495)          -              -         (2,495)
Investment in subsidiaries                                               (2,657)          -          2,657              -
                                                                     -------------------------------------------------------
            Cash used in investing activities                           (19,206)       (108)         2,657        (16,657)

Financing activities
Net borrowings (payments) under line of credit                           14,578      (1,547)         1,547         14,578
Payments on long-term debt                                              (11,727)          -              -        (11,727)
Net change in receivable from affiliates                                  1,868           -              -          1,868
Distributions to stockholder                                             (2,556)          -              -         (2,556)
                                                                     -------------------------------------------------------
            Cash provided by (used in) financing
              activities                                                  2,163      (1,547)         1,547          2,163
                                                                     -------------------------------------------------------
Net increase in cash                                                          3         289              -            292
            Cash at beginning of year                                     4,648          69              -          4,717
                                                                     -------------------------------------------------------
            Cash at end of year                                      $    4,651   $     358     $        -      $   5,009
                                                                     =======================================================

Supplemental disclosures of cash flows
   information are as follows:
        Cash paid for interest                                       $   24,744   $       -     $        -      $  24,744
        Cash paid for income taxes                                          268          12              -            280
</TABLE>

                                       38

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

12. Quarterly Results of Operations (Unaudited)

<TABLE>
<CAPTION>
                                                    Year ended December 31, 2002
                                       ------------------------------------------------------
                                       1st Quarter    2nd Quarter  3rd Quarter    4th Quarter
                                       ------------------------------------------------------
                <S>                    <C>            <C>          <C>            <C>
                Net sales              $   266,362    $   390,313  $   416,397    $   351,633
                Gross profit                66,041         98,210      107,080         98,281
                Net income (loss)           (4,249)        12,545       20,843         11,970

<CAPTION>
                                                    Year ended December 31, 2001
                                       ------------------------------------------------------
                                       1st Quarter    2nd Quarter  3rd Quarter    4th Quarter
                                       ------------------------------------------------------
                <S>                    <C>            <C>          <C>            <C>
                Net sales              $   247,483    $   370,828  $   409,262    $   353,957
                Gross profit                59,553         89,324      101,522         93,939
                Net income (loss)           (6,562)        12,145       20,573         16,080
</TABLE>

                                       39

<PAGE>

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this Report on Form 10-K to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Beloit, State of Wisconsin, on March 20, 2003.

                            AMERICAN BUILDERS & CONTRACTORS
                            SUPPLY CO., INC.


                                 By: /s/ Kenneth A. Hendricks
                                     -------------------------
                                 Kenneth A. Hendricks
                                 Chief Executive Officer, Chairman of the Board


                                 By: /s/ David Luck
                                     -----------------
                                 David Luck
                                 Chief Operating Officer, Director


                                 By: /s/ Diane M. Hendricks
                                     -------------------------
                                 Diane M. Hendricks
                                 Executive Vice President, Director


                                 By: /s/ Kendra A. Story
                                     ----------------------
                                 Kendra A. Story
                                 Chief Financial Officer, Treasurer, Director

                                       40

<PAGE>

Section 302 Certification Requirements

CERTIFICATIONS

I, Kenneth A. Hendricks, certify that:

1.   I have reviewed this annual report on Form 10-K of American Builders &
     Contractors Supply Co., Inc.;

2.   Based on my knowledge, this annual report does not contain any untrue
     statement of a material fact or omit to state a material fact necessary to
     make the statements made, in light of the circumstances under which such
     statements were made, not misleading with respect to the period covered by
     this annual report;

3.   Based on my knowledge, the financial statements, and other financial
     information included in this annual report, fairly present in all material
     respects the financial condition, results of operations and cash flows of
     the registrant as of, and for, the periods presented in this annual report;

4.   The registrant's other certifying officers and I are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

     a) designed such disclosure controls and procedures to ensure that material
     information relating to the registrant, including its consolidated
     subsidiaries, is made known to us by others within those entities,
     particularly during the period in which this annual report is being
     prepared;

     b) evaluated the effectiveness of the registrant's disclosure controls and
     procedures as of a date within 90 days prior to the filing date of this
     annual report (the "Evaluation Date"); and

     c) presented in this annual report our conclusions about the effectiveness
     of the disclosure controls and procedures based on our evaluation as of the
     Evaluation Date;

5.   The registrant's other certifying officers and I have disclosed, based on
     our most recent evaluation, to the registrant's auditors and the audit
     committee of registrant's board of directors (or persons performing the
     equivalent function):

     a) all significant deficiencies in the design or operation of internal
     controls which could adversely affect the registrant's ability to record,
     process, summarize and report financial data and have identified for the
     registrant's auditors any material weaknesses in internal controls; and

     b) any fraud, whether or not material, that involves management or other
     employees who have a significant role in the registrant's internal
     controls; and

6.   The registrant's other certifying officers and I have indicated in this
     annual report whether or not there were significant changes in internal
     controls or in other factors that could significantly affect internal
     controls subsequent to the date of our most recent evaluation, including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.

Date:  March 20, 2003

/s/ Kenneth A. Hendricks
-----------------------------
[Signature]
Chief Executive Officer

                                       41

<PAGE>

Section 302 Certification Requirements

CERTIFICATIONS

I, Kendra A. Story, certify that:

1.   I have reviewed this annual report on Form 10-K of American Builders &
     Contractors Supply Co., Inc.;

2.   Based on my knowledge, this annual report does not contain any untrue
     statement of a material fact or omit to state a material fact necessary to
     make the statements made, in light of the circumstances under which such
     statements were made, not misleading with respect to the period covered by
     this annual report;

3.   Based on my knowledge, the financial statements, and other financial
     information included in this annual report, fairly present in all material
     respects the financial condition, results of operations and cash flows of
     the registrant as of, and for, the periods presented in this annual report;

4.   The registrant's other certifying officers and I are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

     a) designed such disclosure controls and procedures to ensure that material
     information relating to the registrant, including its consolidated
     subsidiaries, is made known to us by others within those entities,
     particularly during the period in which this annual report is being
     prepared;

     b) evaluated the effectiveness of the registrant's disclosure controls and
     procedures as of a date within 90 days prior to the filing date of this
     annual report (the "Evaluation Date"); and

     c) presented in this annual report our conclusions about the effectiveness
     of the disclosure controls and procedures based on our evaluation as of the
     Evaluation Date;

5.   The registrant's other certifying officers and I have disclosed, based on
     our most recent evaluation, to the registrant's auditors and the audit
     committee of registrant's board of directors (or persons performing the
     equivalent function):

     a) all significant deficiencies in the design or operation of internal
     controls which could adversely affect the registrant's ability to record,
     process, summarize and report financial data and have identified for the
     registrant's auditors any material weaknesses in internal controls; and

     b) any fraud, whether or not material, that involves management or other
     employees who have a significant role in the registrant's internal
     controls; and

6.   The registrant's other certifying officers and I have indicated in this
     annual report whether or not there were significant changes in internal
     controls or in other factors that could significantly affect internal
     controls subsequent to the date of our most recent evaluation, including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.

Date:  March 20, 2003

/s/ Kendra A. Story
------------------------------
[Signature]
Chief Financial Officer

                                       42

<PAGE>

                                 EXHIBITS INDEX

3.1    Certificate of Incorporation of the Company [Incorporated by reference to
       exhibit 3.1 to the Company's Registration Statement on Form S-4 (File No.
       33-26991)].

3.2    By-laws of the Company [Incorporated by reference to exhibit 3.2 to the
       Company's Registration Statement on Form S-4 (File No. 33-26991)].

3.3    Articles of Incorporation of Mule-Hide [Incorporated by reference to
       exhibit 3.3 to the Company's Registration Statement on Form S-4 (File No.
       33-26991)].

3.4    By-laws of Mule-Hide [Incorporated by reference to exhibit 3.4 to the
       Company's Registration Statement on Form S-4 (File No. 33-26991)].

3.5    Certificate of Incorporation of Amcraft [Incorporated by reference to
       exhibit 3.5 to the Company's Registration Statement on Form S-4 (File No.
       33-26991)].

3.6    By-laws of Amcraft [Incorporated by reference to exhibit 3.6 to the
       Company's Registration Statement on Form S-4 (File No. 33-26991)].

3.7    Certificate of Incorporation of VH Manufacturing Acquisition Co., Inc.,
       By-laws of VH Manufacturing Acquisition Co., Inc. and Certificate of
       Amendment of Certificate of Incorporation of Vande Hey Raleigh Roof Tile
       Manufacturing, Inc. [Incorporated by reference to exhibit 3.7 to the
       Company's Form 10-K for the period ending December 31, 2001 (File No.
       33-26991)]

3.8    Certificate of Incorporation of VH Contractor Acquisition Co., Inc.,
       By-laws of VH Contractor Acquisition Co., Inc. Certificate of Amendment
       of Certificate of Incorporation of Vande Hey Roof Tile Installation, Inc.
       [Incorporated by reference to exhibit 3.8 to the Company's Form 10-K for
       the period ending December 31, 2001 (File No. 33-26991)]

3.9    Articles of Incorporation of M-H Manufacturing Co., Inc., By-laws of M-H
       Manufacturing Co., Inc.

3.10   Articles of Organization of Seven KH Aviation, LLC, Operating Agreement
       of Seven KH Aviation, LLC.

10.1   Employment Agreement, dated as of May 1, 1997, between the Company and
       Kenneth A. Hendricks [Incorporated by reference to exhibit 10.3 to the
       Company's Registration Statement on Form S-4 (File No. 33-26991)].

10.2   Tax Allocation Agreement, dated as of May 1, 1997, among the Company,
       Mule-Hide and Amcraft and Kenneth A. Hendricks [Incorporated by reference
       to exhibit 10.4 to the Company's Registration Statement on Form S-4 (File
       No. 33-26991)].

10.3   Form of lease agreement between the Company and Hendricks Real Estate
       Properties and schedule of lease terms for all properties leased pursuant
       thereto [Incorporated by reference to exhibit 10.5 to the Company's
       Registration on Form S-4 (File No. 33-26991)].

10.4   Amended and Restated Patent, Trademark and License Mortgage by the
       Company in favor of NationsBank of Texas, N.A., as agent for the lenders
       under the Credit Agreement, as amended [Incorporated by reference to
       exhibit 10.7 to the Company's Registration on Form S-4 (File No.
       33-26991)].

                                       43

<PAGE>

10.5   Employment Agreement, dated as of May 1, 1998 between the Company and
       David Luck. [Incorporated by reference to exhibit 10.1 to the Company's
       Form 10-Q for the period ending June 30, 1998 (File No. 33-26991)]

10.6   Employment Agreement, dated as of November 30, 1998, between the Company
       and Robert Bartels. [Incorporated by reference to exhibit 10.11 to the
       Company's Form 10-K for the period ending December 31, 1998 (File No.
       33-26991)]

                                       44

<PAGE>

10.7   Third Amended and Restated Loan and Security Agreement among American
       Builders & Contractors Supply Co., Inc. as Borrower, Bank of America,
       National Association as Agent and a Lender, and American National Bank
       and Trust Company of Chicago, as Co-Agent and a Lender and the Other
       Lenders Party Hereto dated as of March 21, 2002. [Incorporated by
       reference to exhibit 10.20 to the Company's Form 10-K for the period
       ending December 31, 2001 (File No. 33-26991)]

10.8   First Amendment to Third Amended and Restated Loan and Security
       Agreement, dated September 30, 2002, among American Builders &
       Contractors Supply Co., Inc. as Borrower, Bank of America, National
       Association as Agent and a Lender, and American National Bank and Trust
       Company of Chicago, as Co-Agent and a Lender and the Other Lenders Party
       Hereto. [Incorporated by reference to exhibit 10.1 to the Company's Form
       10-Q for the period ending September 30, 2002 (File No. 33-26991)]

21.1   Subsidiaries of the Company, Mule-Hide, Amcraft, Vande Hey Roof Tile
       Installation, Inc., Vande Hey Raleigh Roof Tile Manufacturing, Inc.,
       Mule-Hide Manufacturing Co., Inc. and Seven KH Aviation, LLC.

                                       45

<PAGE>

                AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC.
                 SCHEDULE II. VALUATION AND QUALIFYING ACCOUNTS

                  Years Ended December 31, 2002, 2000 and 1999
                                 (in thousands)

<TABLE>
<CAPTION>
                                                Balance at     Additions
                                                Beginning     Charged to     Deductions     Balance at
Description                                      of Year        Expense          (1)        End of Year
-----------                                    -----------   -------------  ------------   -------------
<S>                                            <C>           <C>            <C>            <C>
Accounts Receivable--Allowance for
  doubtful accounts:
      2002                                        $7,595        $11,190        $9,540          $9,245
      2001                                         6,075          8,116         6,596           7,595
      2000                                         6,975          7,323         8,223           6,075

(1) Consist of charge-offs, net of recoveries
</TABLE>

                                       46