SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   Form 10-KSB

                 X   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                ---
                      OF THE SECURITIES EXCHANGE ACT OF 1934

                   For the Fiscal Year Ended December 31, 1999

                TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                        Commission file number 000-25351

                      ALFORD REFRIGERATED WAREHOUSES, INC.
             (Exact name of registrant as specified in its charter)


                                      TEXAS
                         (State or other jurisdiction of
                         incorporation or organization)


                                   75-2695621
                                (I.R.S. Employer
                             Identification Number)


                      318 Cadiz Street, Dallas, Texas 75207
                    (Address of principal executive offices)


       Registrant's telephone number, including area code: (214) 426-5151
        Securities registered pursuant to Section 12(b) of the Act: None
               Securities registered pursuant to Section 12(g) of
                                    the Act:

                          Common Stock, $0.01 Par Value
                                (Title of class)

         Indicate by check mark 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  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-B 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 Report on Form 10-KSB
or any amendment to this Report on Form 10-KSB. _____

         The total  issuer's  revenue  for its most  recent  fiscal  year  ended
December 31, 1999 was $15,712,757.

         The aggregate  market value of the voting stock (which  consists solely
of shares of Common Stock) held by  non-affiliates of the Registrant as of March
22, 2000 (based upon the average bid and asked price) was $3,698,357.50.

         Check whether the issuer has filed all documents  and reports  required
to be  filed  by  Section  12,  13 or  15(d)  of  the  Exchange  Act  after  the
distribution  of securities  under a plan  confirmed by a court.  Yes  X   No
                                                                      ---    ---

         As of March 22, 2000 there were 7,540,715 shares of the issuer's Common
Stock, par value $0.01 per share,  issued and 7,040,715 shares  outstanding.  Of
such outstanding shares, 1,479,343 were held by non-affiiliates.

         Documents Incorporated by Reference.  None.

         Transitional Small Business Issuer Format.  Yes      No   X
                                                         ---      ---



<PAGE>

<TABLE>
<CAPTION>

                                TABLE OF CONTENTS

                                                                                                               PAGE

<S>                                                                                                             <C>
PART  I...........................................................................................................1
         Item 1. DESCRIPTION OF BUSINESS..........................................................................1
         Item 2. DESCRIPTION OF PROPERTY..........................................................................5
         Item 3. LEGAL PROCEEDINGS................................................................................6
         Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS..............................................6
PART II...........................................................................................................6
         Item 5. MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS.........................................6
         Item 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS............7
         Item 7. FINANCIAL STATEMENTS............................................................................12
         Item 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE............12
PART III.........................................................................................................12
         Item 9. COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT; DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND
         CONTROL PERSONS.........................................................................................12
         Item 10. EXECUTIVE COMPENSATION.........................................................................14
         Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.................................15
         Item 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.................................................15
         Item 13. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K...............................16
      SIGNATURES.................................................................................................18

</TABLE>

                                       i
<PAGE>


                                     PART I

Item 1.  DESCRIPTION OF BUSINESS

The Company

Alford  Refrigerated  Warehouses,  Inc., a Texas  corporation  formerly known as
Hilltop  Acquisition  Holding  Corporation,   and  prior  to  that,  as  Optical
Acquisition Corp. (the "Company"),  was originally  incorporated in October 1992
under the laws of the State of Delaware.

The Company  filed a  bankruptcy  petition on  September  21, 1995 and filed the
First Amended  Joint Plan of  Reorganization  (the "Plan") on July 9, 1996.  The
United  States  Bankruptcy  Court for the  Northern  District  of Texas,  Dallas
Division  (the "Court")  entered an order  approving the Plan on August 9, 1996.
The Plan was modified pursuant to an order of the Court on February 28, 1997.

The Plan provided for the liquidation of the Company's  assets and  distribution
of the proceeds and stock to secured, priority and unsecured creditors. The Plan
further  provided  that the Company  would  remain in  existence,  although  all
capital stock  outstanding  as of the Petition Date was canceled The Company was
reincorporated in the State of Texas in September 1997.

As contemplated in the Plan, the Company, which had no operations or significant
assets  at the  time,  had  undertaken  a  business  strategy  to  seek  out and
consummate an acquisition or merger transaction.

         Merger with Alford

On or about  December  15,  1998,  the Company  merged with Alford  Refrigerated
Warehouses,  Inc.  ("Alford")  pursuant to an Agreement and Plan of Merger dated
November 23, 1998 by and among Hilltop, Womack Gilman Investment Services, L.C.,
Halter Financial Group, Inc. and Alford (the "Merger Agreement").  In accordance
with the terms of the Merger  Agreement,  Alford was the surviving  corporation.
Immediately  prior to the merger,  Hilltop amended its Articles of Incorporation
to effect a reverse  stock  split so that each  share of  Hilltop's  issued  and
outstanding  common stock was automatically  converted into .625 of a fully paid
and nonassessable share of Hilltop's common stock.  Pursuant to the terms of the
Merger  Agreement,  each  share of  common  stock of  Alford  was  automatically
converted into the right to receive  655.1372  shares of the common stock of the
Company.  In addition,  the Articles of  Incorporation  and the Bylaws of Alford
became the Articles of  Incorporation  and Bylaws of the Company,  the directors
and officers of Alford became the directors and officers of the Company, and the
Company changed its name to Alford Refrigerated Warehouses, Inc. The transaction
is considered a reverse merger.

In November 1998, certain affiliated entities of Alford were merged into Alford.
These  entities,   including  Robco  Industries,   Inc.  ("Robco")  and  Alltemp
Logistical  Services,  LLC  ("Alltemp")  are in the same line of business as the
Company  and,  by virtue  of their  ultimate  ownership,  are  considered  to be
entities under common control with the Company. Accordingly,  these mergers were
accounted  for in a manner  similar to a pooling of  interests  and the  balance
sheets,  statements  of  operations,  stockholders'  equity  and cash flows give
retroactive effect to the mergers as if they occurred as of the beginning of the
earliest period presented. The operations of Robco and Alltemp are insignificant
to total operations.

The Business

The Company  believes  that it is the largest  public  refrigerated  warehousing
operation in the southwest United States. The Company operates a network of four
strategically  located refrigerated  warehouse facilities in Texas, with a total

                                       1

<PAGE>

area of 1,500,000 sq. ft. or 33,000,000 cu. ft. of storage space.  The Company's
principal executive office is located at 318 Cadiz Street,  Dallas,  Texas 75207
and its telephone number is (214) 426-5151.

The Company's public warehouse business consists of providing  customers,  which
include  food  processors,   distributors,   wholesalers  and  retailers,   with
temperature controlled storage services and a full range of logistics management
and other  value-added  services such as (i) blast  freezing of fresh  products,
(ii)  repackaging  and labeling of food  products,  (iii) order picking and load
consolidation,  (iv) cross-docking,  (v) container handling,  (vi) importing and
exporting  services,  (vii) USDA approved storage and inspection  services,  and
(viii) Federal Government inspected facility for export.

The Company is a third party service  provider and as such does not purchase the
inventory that it stores.  When the Company  receives  products for storage,  it
provides the customer with a nonnegotiable  warehouse receipt. At that time, the
customer  pays for one month of  storage  and  handling  based upon the type and
amount of product accepted at the beginning of the 30 day period.  The Company's
inventory  control  system  monitors  the  product by type of product and by lot
number.  In order to remove any product from  storage,  the  customer  places an
order with the Company,  the Company  removes the product from the warehouse for
the customer and  provides the customer  with a bill of lading.  If there is any
product remaining in storage at the end of the 30 day period,  the Company bills
the customer for an additional 30 days of storage.

In addition to its public warehouse  business,  the Company leases  refrigerated
space to  approximately  28 tenants who manage their own inventory and logistics
functions and utilize their own  equipment and  personnel.  In almost all cases,
the tenant pays all of the expenses,  except for  utilities  and property  taxes
which are included in the rent. The terms of the leases may be month to month or
as long as five years.  The Company  does not allow  tenants to make any special
modifications to the leased space without the Company's prior approval.  For the
year ended December 31, 1999 public warehouse customers  represented over 92% of
the Company's revenue,  the remainder of which was attributable to leased space.
For the year ended December 31, 1998,  public  warehouse  customers  represented
approximately 93% of the Company's revenue.

The Company is designing and planning the construction of a 4,000,000 cubic foot
addition to its Cadiz Street facility in Dallas,  Texas. The Company anticipates
that the new addition will contain a blast freezing capacity of 400,000 lbs. per
day and storage at -20EF.

         The Industry

The public refrigerated warehousing industry provides refrigerated  warehousing,
inventory management and logistics services to food processors, distributors and
retailers of frozen and chilled foods during the period  between  production and
consumption.  In the food  industry,  there is a period  between  production and
consumption  as  well as a  continuing  shift  by  individual  food  processors,
distributors and retailers from owning their refrigerated  storage facilities to
outsourcing their warehousing  requirements,  inventory management and logistics
functions to operators of public  refrigerated  warehousing  businesses  who are
generally more economical providers of such services.

Historically,  public  refrigerated  warehousing  growth  has  been  steady  and
non-cyclical.  Although the overall U.S.  food  industry has been growing at the
rate of population growth,  according to a U.S. Department of Agriculture report
dated January of 1998,  the public  refrigerated  warehousing  industry has been
growing more rapidly than the population,  at an average  compound annual growth
rate of 4.5% per year over the past 10 years.

                                       2

<PAGE>

         Customers

The Company had  approximately 600 customers during the 12 months ended December
31,  1999 and  during the 12 months  ended  December  31,  1998.  The  Company's
customers include a broad base of national,  regional and local food processors,
distributors,  wholesalers  and  retailers.  The current  customer base includes
Pilgrim's  Pride,  Beatrice  Foods,  M & M Mars,  Kroger Co.,  Maple Leaf Foods,
Borden Dairy, Chef America,  Birdsong Peanuts and many others. During the twelve
months ended December 31, 1999 and December 31, 1998, no customer  accounted for
more than 10% of the Company's revenues.

         Competition; Growth Potential

The United States public  refrigerated  warehousing market is highly fragmented.
According to the International  Association of Refrigerated  Warehouses,  the 10
largest public  refrigerated  warehousing  firms  represent less than 40% of the
available public refrigerated warehousing space. Public refrigerated warehousing
facilities in the United States are typically  owned by strong local or regional
operators with one to four facilities representing 2 to 14 million cubic feet of
public refrigerated warehousing space which, on average,  generate direct profit
contribution margins of 40%. Many of these companies are family-owned businesses
without  successors  active in the  management  of the  business.  Based on past
experience  with such  owners and the  dynamics  of the  industry,  the  Company
believes that many of these  businesses can be acquired at attractive  cash flow
multiples.

         Sales and Marketing

The Company's  marketing and sales efforts are  integrated  across all levels of
management.  Senior  management  has the  responsibility  for  major  customers,
including  all  national  accounts.  In  addition,  customers in each region are
serviced  by  regional  general  managers  who work  with  sales  and  marketing
professionals to plan and execute regional business development  strategies.  At
the local level, individual facility managers are responsible for developing and
maintaining long-term relationships with customers.

The Company's  management  and sales  professionals  are  aggressively  pursuing
business  development  opportunities  that arise from natural  market  growth as
sales  of  frozen  foods  increase  and the  trend  towards  the  use of  public
refrigerated warehouse services continues. Management believes that by taking an
active role in the management and coordination of its customers' inventories and
by providing a broader  range of logistics  services,  the Company will maintain
its competitive advantage over the long term.

         Suppliers

The Company's largest expenses are labor and utilities. It is not dependent upon
any one supplier for raw  materials.  The majority of the Company's  maintenance
services are provided primarily by its own employees.

         Employees

As of December 31, 1999, the Company had a total of 182  employees,  all of whom
are full-time employees. Of these employees,  approximately 124 were employed at
the Dallas,  Texas  facility  which  includes  its  corporate  offices,  37 were
employed at the La Porte facility,  13 were employed at the Richardson  facility
and 8 were  employed  at the Fort  Worth  facility.  None of the  employees  are
represented by a labor union.

                                       3
<PAGE>


         Government Regulation

The  Company's  operations  are  subject  to  federal,  state  and  local  laws,
regulations  and  ordinances  relating  to  the  storage,  handling,   emission,
transportation  and discharge of certain  materials and various other health and
safety  matters.  These  laws  include  the  Clean  Air Act,  the  Comprehensive
Environmental Response, Compensation and Liability Act of 1980, and the Resource
Conservation and Recovery Act. For example,  the Company uses anhydrous  ammonia
in its operations.  In addition, the Company used a type of refrigerant which is
no longer being  produced  because of  government  regulations.  The Company has
modified  its  equipment  and all of its  equipment is able to use a new type of
refrigerant.  The Company's operations also are governed by laws and regulations
relating to workplace  safety and worker health,  principally  the  Occupational
Safety and Health Act and the regulations thereunder.

Governmental  authorities  have  the  power to  enforce  compliance  with  their
regulations,  and violators may be subject to fines,  injunctions  or both.  The
Company  believes that it is currently in substantial  compliance  with all such
applicable  laws and  regulations.  The Company cannot at this time estimate the
impact of any increased regulation on the Company's  operations,  future capital
expenditure requirements or the cost of compliance.

In addition to regulating  the Company  directly,  the  Company's  customers are
subject  to  certain  regulations  relating  to the  import  and  export of food
products.  The Company  maintains an approved  USDA  inspection  room on site at
three of its four facilities for the benefit of its customers.

         Research

The Company  generally  does not spend any material  amount of its  resources on
research and development.  Rather, it is a member of the Refrigeration  Research
and Education  Foundation which is an organization that was founded in 1943 as a
scientific and educational foundation for the following purposes:

o        to advance the application  of refrigeration technology for better pre-
         servation of food and commodities;

o        develop and support research in the science of refrigeration;

o        cooperate  with  government  and   private   institutions  in  research
         activities;

o        train and educate refrigerated warehouse/distribution personnel; and

o        establish and make  available a repository  of  scientific  information
         specific to the industry.

         Licenses, Permits and Product Registrations

The Company  uses certain  licenses and  registrations  in its  operations.  For
example,  the Company has a  perpetual  license for the use of certain  software
from Maves  International  Software,  Inc.  The Company  uses this  software for
inventory  control and financial  reporting.  The Company is not required to pay
any  additional  royalties on the software,  however,  the Company  periodically
purchases upgrades to the software.

In  addition,  Alford  Distribution  Services,  Inc.  ("ADS"),  a  wholly  owned
subsidiary  of the  Company,  is  licensed  by  the  Texas  Alcoholic  Beverages
Commission to store products containing alcohol.  ADS is required to post a bond

                                       4

<PAGE>


each year to maintain this license which is subject to revocation,  modification
and renewal each year by the commission.

For the benefit of its customers,  the Company  maintains a room at three of its
four  facilities  that is  approved by the USDA for use in  connection  with the
inspection of food products.

The Company's  trademark,  a penguin,  is registered  with the patent  trademark
office. This registration is periodically subject to renewal.

Item 2.  DESCRIPTION OF PROPERTY

Set  forth  below is  information  with  respect  to  certain  of the  Company's
properties.  The  industry  measures  space in cubic feet instead of square feet
because cost projections  include  facility height to account for  refrigeration
and stacked cooled product.  The Company  believes that all of these  properties
are adequately  insured,  in good  condition and suitable for their  anticipated
future use.

<TABLE>
<CAPTION>


                                                                                                       Lease
Location                    Primary Use            Approximate Size          Owned/Lease          Expiration Date
--------                    -----------            ----------------          -----------          ---------------
<S>                         <C>                    <C>                       <C>                    <C>
Dallas, Texas               Corporate office &     24,000,000 cubic feet     Owned                  N/A
                            Warehouse              on 52 acres

La Porte, Texas             Warehouse              4,500,000 cubic feet on   Owned                  N/A
                                                   32.3 acres

Richardson, Texas           Warehouse              3,200,000 cubic feet on   Leased                 Dec. 31, 2007
                                                   12.4 acres

Fort Worth, Texas           Warehouse              1,550,000 cubic feet on   Owned                  N/A
                                                   13.5 acres
</TABLE>

         Dallas, Texas

The Company has 18 tenants at its Dallas,  Texas  facility.  Of these, no tenant
occupies ten percent or more of the rentable cubic footage of the facility.  The
Company  itself  uses a majority  of the total  cubic feet of the  facility as a
public refrigerated  warehouse. A majority of the Dallas, Texas facility is used
for  refrigerated  warehousing  purposes.  The  remainder is used for public dry
storage and for the Company's corporate offices.

The Dallas,  Texas  facility is subject to a 10 year fixed rate  mortgage in the
original principal amount of $8,100,000 which accrues interest at 8.4% per year.
As of March 22, 2000, the Company owed approximately  $7,680,995 on the mortgage
which  matures  on  or  about  October  1,  2007.  At  that  time,  assuming  no
prepayments, the Company will owe approximately $5,682,578.

The Company currently plans to construct a 4,000,000  cubic-foot addition to its
facility  in  Dallas,   Texas.   The  estimated  cost  of  the  improvements  is
approximately  $8,000,000  which  amount  most  likely  will  be  financed  by a
conventional mortgage or sale of convertible debentures in addition to cash flow
and the issuance of the Company's common shares.

                                       5
<PAGE>

         La Porte, Texas

The  Company has three  tenants at its La Porte  facility.  Of these,  no tenant
occupies ten percent or more of the rentable cubic footage of the facility.  The
Company  itself  uses a majority  of the total  cubic feet of the  facility as a
public refrigerated warehouse.

This  property  is  subject to a 10 year fixed  rate  mortgage  in the  original
principal  amount of $5,400,000  which accrues interest at 8.36% per year. As of
March 22, 2000, the Company owed approximately  $5,275,610 on the mortgage which
matures on or about March 1, 2008. At that time,  assuming no  prepayments,  the
Company will owe approximately $4,511,799.

         Richardson, Texas

The  Company has three  subtenants  at its  Richardson  facility.  Of these,  no
subtenant  occupies  ten percent or more of the  rentable  cubic  footage of the
facility. The Company has executed an exclusive option contract for the purchase
of this property for $6,000,000.

The Company has received a term sheet from a bank, subject to due diligence,  to
finance the  purchase of the  property in an amount up to 70% of the  property's
appraised  value.  The Company hopes to close this transaction by the end of the
second quarter of 2000.

         Fort Worth, Texas

As of  December  31,  1999,  the  Company  had four  tenants  at its Fort  Worth
facility.  Of these,  Kroger Co. accounted for approximately 30% of the space in
the  facility.  The lease  between  the Company and Kroger Co. is for a one year
term with provisions for annual renewal.

This  property is subject to a 3 year  variable  rate  mortgage in the  original
principal  amount of $2,100,000 which accrues interest at prime rate plus 0.50%.
As of March 22, 2000, the Company owed approximately  $1,983,333 on the mortgage
which  matures on or about May 1, 2002. At that time,  assuming no  prepayments,
the Company will owe approximately $1,691,655.

Item 3.  LEGAL PROCEEDINGS

Other than routine litigation  incidental to the business,  the Company is not a
party to any legal actions or proceedings.

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

During  the  fourth  quarter  of the  fiscal  year  1999,  there were no matters
submitted to a vote of security holders.

                                    PART II

Item 5.  MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS

The company  securities  have been traded on the NASDAQ  Small Cap market  since
September  of 1999.  High and low  sales  prices  for the  equity  for each full
quarterly period are as follows:

                                       6

<PAGE>


1999 Quarter                      High                                   Low
1st                               N/A                                    N/A
2nd                               N/A                                    N/A
3rd                               $ 5.25                                 $ 2.875
4th                               $ 4                                    $ 2.25

As of March 22,  2000,  there were  7,540,715  shares of Common Stock issued and
7,040,715 shares of Common Stock outstanding held by approximately 1,100 holders
of record.

The Company has not paid dividends on its Common Stock and  anticipates  that in
2000 all earnings will be retained to finance the continuing  development of its
business.  The Company does not anticipate  paying dividends on the Common Stock
in 2000 but may consider paying dividends thereafter. The Company's current bank
loan  agreement  requires  the bank's prior  written  consent for the payment of
dividends.

Item 6. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

With the  exception of  historical  information,  the matters  discussed in this
report are "forward  looking  statements" as that term is defined in Section 21E
of the  Securities  Exchange Act of 1934.  The Company  cautions the reader that
actual  results  could  differ  materially  from those  expected  by the Company
depending  on the outcome of certain  factors,  including,  without  limitation,
adverse changes in the market for the Company's  services,  competition from new
facilities,  loss of revenues due to fires or accident,  labor shortages and the
loss  of  significant  customers  or  increased  utilities  costs.  Readers  are
cautioned  not to place undue  reliance on any  forward-looking  statement.  All
forward-looking statements speak only as of the date of this filing. The Company
does not have any obligations to update or otherwise make any revisions to these
statements  to reflect  events or  circumstances  after the date of this filing,
including,  without  limitation,  changes in the Company's  business strategy or
planned  capital  expenditures,  or to reflect the  occurrence of  unanticipated
events.

Unless  otherwise  noted,  all dollar amounts are rounded to the nearest dollar.
Reference to 1998 and 1999 are to the year ended December 31 of each year.

Results Of Operations

The Company currently operates four facilities,  all of which are located in the
state of  Texas.  Included  in the  revenues  and  expenses  for the year  ended
December 31, 1998 are the results of a fifth  facility  located in Houston which
was  discontinued in November of 1998 due to the termination of the lease on the
facility by the landlord.

Year Ended December 31, 1999, Compared To Year Ended December 31, 1998

         Revenues

Total revenues for 1999 were  $15,712,757,  a decrease of $1,939,184,  or 11.0%,
compared to revenues of $17,651,941  for 1998.  This decrease in revenues is due
primarily to having discontinued the operation in Houston in 1998.


                                       7
<PAGE>


The Company  recorded a net income of  $664,828  or $.09 per share for 1999,  as
compared to a net income of $813,276, or $.12 per share for 1998.

         Operating Costs

Operating  costs  decreased  by  $1,399,513,  or 12.1%  from  1998 to 1999,  due
primarily  to the  decrease in costs  associated  with the  Houston  facility of
$1,292,312.  This  decrease  is  generally  figured  by  netting  the  following
increases and decreases:

                  -    Wages  and  benefits  decreased  by  $150,421,  or  2.3%,
                       however the  decrease of $665,073  from the  discontinued
                       operation  in Houston  was offset by an increase in wages
                       at the Dallas  facility  and an overall  increase  in the
                       cost  of  health  and  workers'  compensation   insurance
                       premiums.

                  -    Utilities decreased by $349,879, or 13.5%,  primarily due
                       to the decrease of  $268,084 from the discontinued opera-
                       tion in Houston.


                  -    Insurance decreased by $36,879,  or 11.8%,  primarily due
                       to the  favorable  renewal of insurance  premiums and the
                       deletion of the  operation in Houston from the  insurance
                       policies.

                  -    The  remaining  decrease in operating  costs was due to a
                       multitude of decreases  which on an individual  basis are
                       not material and were  primarily due to the  discontinued
                       operation in Houston.

         General and Administrative Expenses

General and  administrative  expenses  increased  by  $113,546,  or 11.2%.  This
increase  was due  primarily  to an  increase in  professional  fees of $162,958
associated  with  public  company  reporting  requirements  and an  increase  in
computer  software costs of $44,210,  some of which are associated with becoming
Y2K compliant.  The overall increase was offset in part by expenses  relating to
the discontinued operation in Houston.

         Depreciation, Amortization, Rent and Interest

Depreciation  expense  increased in 1999 to $904,158 from $776,569 in 1998. This
increase is due primarily to the effect of a full year of depreciation on assets
acquired in 1998 and the depreciation  taken on the Fort Worth facility acquired
in May 1999.  Rent expense  decreased  by $692,376,  or 43.9% from 1998 to 1999.
This decrease was primarily due to the  termination of the lease on the facility
in Houston  and the effect of  purchasing  the Fort Worth  facility in May 1999.
Interest  expense was $1,793,989 in 1999, as compared to $1,498,971 in 1998. The
interest expense increase of $295,018,  or 19.7% is attributed to an increase in
the  interest on the  mortgage in La Porte of $74,044,  since the  facility  was
purchased in February  1998,  interest on the mortgage in Fort Worth of $155,778
and additional  interest of $65,792  related to an increase in funds provided by
the company's  lender through a combination of line of credit and refinancing of
equipment.

         Income Tax Expense or Benefit

Income tax expense  includes  the current  federal tax expense and the effect of
deferred  taxes  related  primarily  to the  difference  between  book  and  tax
depreciation on property,  plant and equipment.  For the year ended December 31,

                                       8

<PAGE>

1999 and December 31, 1998, the Company  recorded income tax expense of $426,000
and $361,000,  respectively. The change from 1998 to 1999 is due primarily to an
increase in deferred taxes for the current year of $70,000.

The Company establishes valuation allowances when necessary,  in accordance with
the provisions of SFAS 109,  "Accounting  for Income Taxes",  to reduce deferred
tax assets to the amount  expected  to be  realized.  Based upon  future  income
projections, the Company expects to realize the net asset.

         Liquidity and Capital Resources

At December  31,  1999,  the  Company's  working  capital  ratio was 0.8 to 1 as
compared to 0.9 to 1 at December 31, 1998. The working  capital ratio  decreased
primarily  due to decreases  in accounts  receivable  of $254,349,  decreases in
prepaid expenses of $28,453 and increases in accounts payable of $374,845.

Net cash  provided  by  operating  activities  for 1999  totaled  $2,347,772  as
compared  to  $2,119,211  for the year  ended  1998.  The  increase  in net cash
provided by operating  activities  is comprised of the  following  factors:  net
income was  $664,828 in 1999,  as  compared  to $813,276 in 1998,  a decrease of
$148,448,  which is  partially  compensated  by an increase in  depreciation  of
$127,589 from 1998 to 1999;  deferred income taxes decreased $398,000 in 1999 as
compared  to a decrease  of  $296,000  in 1998;  accounts  receivable  decreased
$254,349  in 1999 as  compared  to an  increase  of  $188,443  in 1998;  prepaid
expenses  decreased  $364,905 in 1999 as compared to $459,058 in 1998;  accounts
payable  increased  $374,845  in 1999 as  compared  to a increase of $116,068 in
1998; and accrued charges increased $97,978 in 1999 as compared to a decrease of
$37,682 in 1998. The cash provided by these  activities was partially  offset by
an increase in income tax receivable in 1999 of $7,000 as compared to a decrease
of $127,629 in 1998;  other assets  increased  $146,240 in 1999 as compared to a
increase of $39,821 in 1998;  property taxes payable decreased  $117,440 in 1999
as compared to an increase of $294,704 in 1998;  and a decrease in notes payable
of $160,014 in 1999 as compared to $522,254 in 1998.

Net cash used in  investing  activities  was  $4,375,035  in 1999 as compared to
$7,616,006 in 1998. Capital  expenditures for 1999 were $2,539,188,  compared to
$6,817,965 for 1998. The capital  expenditures for 1998 included the purchase of
the La Porte facility for $6,000,000,  which was comprised of mortgage financing
and  cash,  whereas  the  purchase  of the  Fort  Worth  facility  in  1999  for
$3,000,000, was for a combination of mortgage financing of $2,100,000 and common
stock  issued  for  $900,000.  The  Company  made  advances  to  Castor  Capital
Corporation,  the majority  shareholder,  of  $1,735,847  in 1999 as compared to
$798,041  in 1998.  As  settlement  in part for  advances  made to  Castor , the
Company  redeemed  500,000 shares of common stock for $1,750,000.  The price per
share was determined from the average selling price on NASDAQ - SM from the date
the stock began trading until  December 30, 1999.  The 500,000  shares are being
held as treasury stock. The Company sold 2.145 acres of vacant land in September
1999 to a  non-affiliated  third party for  $300,000.  The property was sold for
cash payable on closing,  on a where is, as is basis. In 1999 the Company loaned
$400,000 on a short term basis to an unrelated  third party,  in connection with
the purchase of the Fort Worth facility.

The Company has a line of credit which provides up to  $2,500,000,  of which the
company had borrowed $1,235,000 at December 31, 1999. In addition to the line of
credit the Company had an unfunded overdraft in the amount of $131,654, which is
grouped  for  financial  statement  presentation  with the line of  credit.  The
borrowing base on the line of credit  fluctuates  based on reports  submitted by
the Company to the lender on an a monthly  basis.  The line of credit expires on
May 1, 2000.  Prior to the  expiration  date of the line of credit  the  Company
expects to renew the line of credit with its lender.

Net cash  provided  by  financing  activities  for 1999  totaled  $2,022,821  as
compared to net cash provided by financing activities of $5,159,748 in 1998. The
Company  had net  payments of $182,723 on the line of credit in 1999 as compared

                                       9

<PAGE>

to receiving  $1,021,212 in net advances in 1998. The Company received  mortgage
financing of $2,100,000  in 1999 as compared to $5,400,000 in 1998.  The Company
refinanced  some of its equipment with Bank One Leasing  Corporation in 1999 for
$2,100,000  and used the  proceeds to repay a line of credit and term loan.  The
cash used to make these payments and principal  payments on the Company's  other
long term debt was $2,084,456 in 1999 as compared to principal  payments on long
term debt of $1,261,464 in 1998.

In May of 1999 the Company filed a Form SB-2 registration  statement to register
3,900,000 shares of the Company's common stock. Of the total shares  registered,
1,000,000  shares were to be offered  for sale by the Company on a best  efforts
basis at a price of $4.50 per  share,  2,500,000  shares  were  shares  owned by
Castor Capital Corporation,  the majority shareholder, and the remaining 400,000
shares  were those  issued in  connection  with the  purchase  of the Fort Worth
facility.  The Company  sold a total of 140,000  shares as of December 31, 1999.
Castor Capital  Corporation sold 490,000 shares as of December 31, 1999.  Castor
held 79.0% of the Company's outstanding common stock as of December 31, 1999.

The  Company  guaranteed  a  certain  obligation  of its  parent,  Castor,  this
obligation  totaled  $2,100,000 at December 31, 1999. The Company  believes that
the collateral  pledged by its parent is adequate to cover the debt in case of a
default and has not recorded a liability in the financial  statements related to
this guarantee.

The Company believes that cash flow from operations will be adequate to fund the
Company's capital requirements.

The Company purchased the Fort Worth facility for $3,000,000,  which the Company
had leased since January 1997.  The Company  closed this  transaction on May 21,
1999.  Financing for this  transaction  was provided by a first  mortgage on the
property of $2,100,000 in favor of Bank One,  Texas,  N.A. and 400,000 shares of
the Company's common stock.  Additional collateral was provided to the vendor in
the form of a second lien on the property and a $500,000 note.

The Company has executed an "Exclusive  Option Contract" for the purchase of the
Richardson  facility for  $6,000,000.  The option period expired on February 22,
2000,  however the Company is currently  negotiating  an extension to the option
and  expects to  exercise  the option and  complete  the  purchase in the second
quarter of 2000.

Year 2000

The year 2000 issue  relates to  computer  systems  that use the last two digits
rather than four to define a year and whether  such systems  would  properly and
accurately  process  information  when the year changed to 2000.  During  fiscal
1999, the Company  completed its  company-wide  program to prepare the Company's
computer systems for year 2000 compliance.

At the  date of this  report,  the  company  had not  experienced  any  material
problems  related  to the year 2000.  The  Company  has not become  aware of any
significant  year  2000  issues  affecting  the  Company's  major  customers  or
suppliers. The Company does not anticipate any material complaints regarding any
year 2000 issues related to its products.

Year 2000 related costs through December 31, 1999 were limited to employees' and
consultant's time and were expensed as incurred. The remaining estimated cost to
address any additional year 2000 problems is deemed  immaterial.  No significant
information system projects were deferred to accommodate the year 2000 issues.

                                       10

<PAGE>

Fluctuations In Operating Results; Seasonality

 Generally sales volumes are lowest at the beginning of the fiscal year and grow
steadily to a peak in the fourth quarter.

Environmental Matters

The  Company  is  not  aware  of any  environmental  liability  relating  to its
facilities  or  operations  that  would have a  material  adverse  effect on the
Company, its business, assets or results of operations.

Inflation

Inflation  has  not   historically  had  a  material  effect  on  the  Company's
operations,  and is not expected to have a material impact on the Company in the
future.

Accounting Matters

In June 1998,  the  Financial  Accounting  Standards  Board issued SFAS No. 133,
"Accounting for Derivative  Instruments and Hedging Activities".  This statement
establishes  accounting  and  reporting  standards for  derivative  instruments,
including certain derivative  instruments  embedded in other contracts,  and for
hedging  activities.  In June 1999,  the Financial  Accounting  Standards  Board
issued SFAS No. 137 which delayed the  effective  date of SFAS No. 133 to fiscal
years  beginning  after  June  15,  2000.  At this  time,  the  Company  has not
determined  the impact that adoption of this standard will have on the Company's
financial statements.


                                       11

<PAGE>

Item 7.


FINANCIAL STATEMENTS

Index to Consolidated Financial Statements  See F-2

[The remainder of this page is intentionally left blank]


                                       12
<PAGE>


                      ALFORD REFRIGERATED WAREHOUSES, INC.

                                                                        Contents

================================================================================





                              ALVORD REFRIGERATED
                                 WAREHOUSES, INC.






                                                            Financial Statements
                                          Years Ended December 31, 1999 and 1998




                                      F-1



<PAGE>

                      ALFORD REFRIGERATED WAREHOUSES, INC.

                                                                        Contents

================================================================================


Index to Consolidated Financial Statements

   Report of Independent Certified Public Accountants                        F-3

   Consolidated balance sheets                                               F-4

   Consolidated statements of income                                         F-6

   Consolidated statements of stockholders' equity                           F-7

   Consolidated statements of cash flows                                     F-8

   Notes to consolidated financial statements                                F-9


                                      F-2
<PAGE>


Report of Independent Certified Public Accountants

Board of Directors of
Alford Refrigerated Warehouses, Inc.


We  have  audited  the  accompanying   consolidated  balance  sheets  of  Alford
Refrigerated  Warehouses,  Inc.,  a  subsidiary  of Castor  Capital,  Inc. as of
December 31, 1999 and 1998, and the related  consolidated  statements of income,
stockholders'  equity and cash flows for the years then ended.  These  financial
statements   are  the   responsibility   of  the   Company's   management.   Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards. Those standards require that we plan and perform the audits 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  presentation  of the financial
statements.  We  believe  that our  audits  provide a  reasonable  basis for our
opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects,  the consolidated financial position of Alford
Refrigerated  Warehouses,  Inc.  as of  December  31,  1999  and  1998,  and the
consolidated  results  of its  operations  and its cash flows for the years then
ended in conformity with generally accepted accounting principles.



                                    /s/ BDO Seidman, LLP
                                    --------------------------------
                                    BDO Seidman, LLP

February 25, 2000
Dallas, Texas

                                      F-3
<PAGE>


                      ALFORD REFRIGERATED WAREHOUSES, INC.

                                                     Consolidated Balance Sheets

================================================================================

<TABLE>
<CAPTION>


December 31,                                                                         1999                  1998
--------------------------------------------------------------------------------------------------------------------

Assets

Current assets
<S>                                                                            <C>                   <C>
     Cash and cash equivalents (Note 7)                                        $    105,075          $    109,517
     Accounts receivable                                                          1,753,890             2,008,239
     Prepaid expenses                                                               278,498               250,045
     Income tax receivable                                                           13,000                 6,000
     Escrows (Note 5)                                                               565,282               522,072
--------------------------------------------------------------------------------------------------------------------

Total current assets                                                              2,715,745             2,895,873
--------------------------------------------------------------------------------------------------------------------

Property, plant and equipment, net (Notes 3 and 5)                               21,422,381            18,757,679

Due from affiliates (Note 2)                                                      2,198,926             2,213,079

Deferred tax asset, net (Note 4)                                                          -               221,961

Other assets                                                                        600,418               454,178

Deposits                                                                            172,235               173,640

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

Total assets                                                                   $ 27,109,705          $ 24,716,410
====================================================================================================================
</TABLE>

                                      F-4

<PAGE>


                      ALFORD REFRIGERATED WAREHOUSES, INC.

                                                     Consolidated Balance Sheets

================================================================================

<TABLE>
<CAPTION>


December 31,                                                                        1999                  1998
--------------------------------------------------------------------------------------------------------------------

Liabilities and Stockholders' Equity

Current liabilities
<S>                                                                            <C>                   <C>
     Accounts payable                                                          $    930,336          $    555,491
     Property taxes payable                                                         549,307               666,747
     Accrued charges                                                                822,649               724,671
     Notes payable (Note 5)                                                         351,112               117,768
     Current maturities of long-term debt (Note 5)                                  963,885             1,072,415
--------------------------------------------------------------------------------------------------------------------

Total current liabilities                                                         3,617,289             3,137,092
--------------------------------------------------------------------------------------------------------------------

Deferred revenue                                                                    285,516               224,308
Long-term debt, less current maturities (Notes 2 and 5)                          16,750,318            14,396,572
Line of credit (Note 5)                                                           1,366,654             1,549,377
Deferred tax liability, net (Note 4)                                                176,039                     -
--------------------------------------------------------------------------------------------------------------------

Total liabilities                                                                22,195,816            19,307,349
--------------------------------------------------------------------------------------------------------------------

Commitments and contingencies (Note 6)

Stockholders' equity (Notes 1 and 10)
     Preferred stock, par value $0.01 per share;
         5,000,000 shares authorized; none issued;                                        -                     -
     Common stock, par value $0.01 per share; 50,000,000
         shares authorized; issued 7,540,715 and 7,000,715                           75,407                70,007
     Additional paid-in capital                                                   6,556,995             5,032,395
     Retained earnings                                                              971,487               306,659
--------------------------------------------------------------------------------------------------------------------

                                                                                  7,603,889             5,409,061

     Stock subscriptions and note receivables (Note 11)                            (940,000)                    -
     Treasury stock at cost (500,000 shares)(Note 12)                            (1,750,000)                    -
--------------------------------------------------------------------------------------------------------------------

Total stockholders' equity                                                        4,913,889             5,409,061
--------------------------------------------------------------------------------------------------------------------

Total liabilities and stockholders' equity                                     $ 27,109,705          $ 24,716,410
====================================================================================================================
          The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>

                                      F-5

<PAGE>


                      ALFORD REFRIGERATED WAREHOUSES, INC.

                                               Consolidated Statements of Income

================================================================================

<TABLE>
<CAPTION>

Years ended December 31,                                                           1999                  1998
--------------------------------------------------------------------------------------------------------------------
<S>                                                                            <C>                   <C>
Warehouse Revenues (Note 7)                                                    $ 15,712,757          $ 17,651,941

Operating Costs                                                                  10,211,714            11,611,227
--------------------------------------------------------------------------------------------------------------------

Direct Profit Contribution                                                        5,501,043             6,040,714
--------------------------------------------------------------------------------------------------------------------

General and Administrative Expenses                                               1,127,315             1,013,769

Depreciation, Rent and Interest Expenses

     Depreciation                                                                   904,158               776,569
     Rent                                                                           884,753             1,577,129
     Interest                                                                     1,793,989             1,498,971
--------------------------------------------------------------------------------------------------------------------

Total Depreciation, Rent and Interest Expenses                                    3,582,900             3,852,669
--------------------------------------------------------------------------------------------------------------------

Other Income

Gain on sale of land                                                                300,000                     -
--------------------------------------------------------------------------------------------------------------------

Income Before Income Taxes                                                        1,090,828             1,174,276

Income Tax Expense (Note 4)                                                         426,000               361,000
--------------------------------------------------------------------------------------------------------------------

Net Income                                                                     $    664,828          $    813,276
--------------------------------------------------------------------------------------------------------------------

Net Income Per Share -

     Basic and diluted                                                         $        .09                   .12
--------------------------------------------------------------------------------------------------------------------

Weighted Average Shares Outstanding -

     Basic and diluted                                                         $  7,321,290             6,572,982
--------------------------------------------------------------------------------------------------------------------

          The accompanying notes are an integral part of these consolidated financial statements.

</TABLE>

                                      F-6

<PAGE>


                      ALFORD REFRIGERATED WAREHOUSES, INC.

                                 Consolidated Statements of Stockholders' Equity

================================================================================
<TABLE>
<CAPTION>

                                                                                                Stock
                                                 Common Stock      Additional     Retained  Subscriptions  Treasury         Total
                                            ---------------------    Paid-in      Earnings     and Note      Stock      Stockholders
                                              Shares     Amount      Capital      (Deficit)  Receivables      Cost         Equity
------------------------------------------------------------------------------------------------------------------------------------
<S>                                         <C>        <C>         <C>          <C>          <C>          <C>           <C>
Balance, January 1, 1998                    6,552,087  $  65,521   $ 5,026,881  $ (506,617)  $         -  $          -  $ 4,585,785


Issuance of 448,628 shares in connection
     with reverse merger (Note 1)            448,628       4,486         5,514          -              -             -       10,000

Net income                                         -           -             -    813,276              -             -      813,276
------------------------------------------------------------------------------------------------------------------------------------

Balance, December 31, 1998                 7,000,715      70,007     5,032,395    306,659              -             -    5,409,061

Issuance of 400,000 shares in connection
     with the purchase of land and
     building                                400,000       4,000       896,000          -              -             -      900,000

Issuance of 140,000 shares in connection
     with stock subscription agreements      140,000       1,400       628,600          -       (540,000)            -       90,000

Note received in payment of common
     shares                                        -           -             -          -       (400,000)            -     (400,000)

Return of 500,000 shares in satisfaction
     of amounts due from affiliate                 -           -             -          -              -    (1,750,000)  (1,750,000)

Net income                                         -           -             -    664,828              -             -      664,828
------------------------------------------------------------------------------------------------------------------------------------

Balance, December 31, 1999                 7,540,715    $ 75,407   $ 6,556,995  $ 971,487     $ (940,000)   (1,750,000)   4,913,889
====================================================================================================================================
          The accompanying notes are an integral part of these consolidated financial statements.

</TABLE>

                                      F-7


<PAGE>


                      ALFORD REFRIGERATED WAREHOUSES, INC.

                      Consolidated Statements of Cash Flows

================================================================================
<TABLE>
<CAPTION>


                                      Increase (Decrease) in Cash and Cash Equivalents

Years ended December 31,                                                          1999                  1998
--------------------------------------------------------------------------------------------------------------------

Operating Activities:
<S>                                                                         <C>                   <C>
     Net income                                                             $       664,828       $       813,276
     Adjustments to reconcile net income to net cash
         provided by operating activities:
     Gain on sale of land                                                          (300,000)                    -
     Depreciation expense                                                           904,158               776,569
     Deferred income taxes                                                          398,000               296,000
     Changes in operating assets and liabilities:
         Accounts receivable                                                        254,349              (188,443)
         Prepaid expenses                                                           364,905               459,058
         Deposits and escrows                                                       (41,805)              (42,089)
         Income tax receivable                                                       (7,000)              127,629
         Other assets                                                              (146,240)              (39,821)
         Accounts payable                                                           374,845               116,068
         Property taxes payable                                                    (117,440)              294,704
         Accrued charges                                                             97,978               (37,682)
         Notes payable                                                             (160,014)             (522,254)
         Deferred revenue                                                            61,208                66,196
--------------------------------------------------------------------------------------------------------------------

Net cash provided by operating activities                                         2,347,772             2,119,211
--------------------------------------------------------------------------------------------------------------------

                                                   Investing Activities:

     Proceeds from sale of land                                                     300,000                     -
     Increase in note receivable                                                   (400,000)                    -
     Due from affiliates                                                         (1,735,847)             (798,041)
     Capital expenditures                                                        (2,539,188)           (6,817,965)
--------------------------------------------------------------------------------------------------------------------

Net cash used in investing activities                                            (4,375,035)           (7,616,006)
--------------------------------------------------------------------------------------------------------------------

Financing Activities:

     Proceeds from borrowings                                                     4,200,000             6,421,212
     Principal payments on borrowings                                            (2,267,179)           (1,261,464)
     Proceeds from sale of stock subscriptions                                       90,000                     -
--------------------------------------------------------------------------------------------------------------------

Net cash provided by financing activities                                         2,022,821             5,159,748
--------------------------------------------------------------------------------------------------------------------

Net decrease in cash and cash equivalents                                            (4,442)             (337,047)
Cash and cash equivalents, beginning of year                                        109,517               446,564
--------------------------------------------------------------------------------------------------------------------

Cash and cash equivalents, end of year                                      $       105,075       $       109,517
====================================================================================================================

          The accompanying notes are an integral part of these consolidated financial statements.

</TABLE>

                                      F-8
<PAGE>


                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================

The  accompanying  consolidated  financial  statements  of  Alford  Refrigerated
Warehouses, Inc. and consolidated entities (the "Company") have been prepared in
conformity with generally accepted accounting  principles,  the most significant
of which are described in Note 1 "Summary of Significant  Accounting  Policies".
These,  along  with  the  remainder  of  the  Notes  to  Consolidated  Financial
Statements,  are an integral part of the consolidated financial statements.  The
data  presented  in the Notes to  Consolidated  Financial  Statements  are as of
December  31,  of each  year and for the  years  then  ended,  unless  otherwise
indicated.  Shares and per share data have been  restated for the reverse  stock
split  effected   December   1998,  as  discussed  in  the  following   section,
"Description of the Merger with Alford".

1.      Summary of Significant
        Accounting Policies

        Description of the Merger  Alford Refrigerated Warehouses, Inc., a Texas
        with Alford                corporation   formerly   known   as   Hilltop
                                   Acquisition Holding Corporation, and prior to
                                   that,   as   Optical  Acquisition  Corp. (the
                                   "Company"),  was  originally  incorporated in
                                   October 1992  under the  laws of the state of
                                   Delaware.

                                   The Company  filed a  bankruptcy  petition on
                                   September   21,  1995  and  filed  the  First
                                   Amended  Joint  Plan of  Reorganization  (the
                                   "Plan")  on July 9, 1996.  The United  States
                                   Bankruptcy Court for the Northern District of
                                   Texas,  Dallas Division (the "Court") entered
                                   an  order  approving  the Plan on  August  9,
                                   1996.  The Plan was  modified  pursuant to an
                                   order of the Court on February 28, 1997.

                                   On or about  December 15,  1998,  the Company
                                   merged with Alford  Refrigerated  Warehouses,
                                   Inc.  ("Alford") pursuant to an Agreement and
                                   Plan of Merger  dated  November 23, 1998 (the
                                   "Merger  Agreement").  In accordance with the
                                   terms of the Merger Agreement, Alford was the
                                   surviving  corporation.  Immediately prior to
                                   the merger,  Hilltop  amended its Articles of
                                   Incorporation to effect a reverse stock split


                                      F-9

<PAGE>


                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================



                                   so that each  share of  Hilltop's  issued and
                                   outstanding  common  stock was  automatically
                                   converted  into  .625  of a  fully  paid  and
                                   nonassessable   share  of  Hilltop's   common
                                   stock.  Pursuant  to the terms of the  Merger
                                   Agreement,  each  share  of  common  stock of
                                   Alford was  automatically  converted into the
                                   right  to  receive  655.1372  shares  of  the
                                   common stock of the Company. In addition, the
                                   Articles of  Incorporation  and the Bylaws of
                                   Alford  became the Articles of  Incorporation
                                   and Bylaws of the Company,  the directors and
                                   officers of Alford  became the  directors and
                                   officers  of the  Company,  and  the  Company
                                   changed  its  name  to  Alford   Refrigerated
                                   Warehouses,    Inc.   The    transaction   is
                                   considered a reverse merger.

        Merger of Affiliated       In November 1998, certain affiliated entities
        Entities with Alford       of Alford  were  merged  into  Alford.  These
                                   entities,  including  Robco Industries,  Inc.
                                   ("Robco")and Alltemp Logistical Services, LLC
                                   ("Alltemp") are in the same line  of business
                                   as  the  Company  and,  by  virtue  of  their
                                   ultimate  ownership,  are  considered  to  be
                                   entities   under  common  control  with   the
                                   Company.   Accordingly,  these  mergers  were
                                   accounted  for  in  a  manner  similar  to  a
                                   pooling of interests  and the balance sheets,
                                   statements   of   operations,   stockholders'
                                   equity and cash flows give retroactive effect
                                   to the mergers as if they occurred as of  the
                                   beginning of the earliest period   presented.
                                   The operations   of  Robco  and  Alltemp  are
                                   insignificant to the total operations.

        Description of Business    The   Company's   public   warehouse business
        and Revenue                consists   of   providing   customers,  which
        Recognition                include   food    processors,   distributors,
                                   wholesalers     and      retailers,      with
                                   temperature controlled storage services and a
                                   full range of logistics  management and other
                                   value-added   services   such  as  (i)  blast
                                   freezing of fresh products,  (ii) repackaging
                                   and  labeling of food  products,  (iii) order
                                   picking  and load  consolidation,  (iv) cross
                                   docking,   (v)   container   handling,   (vi)
                                   importing and exporting services,  (vii) USDA
                                   approved storage and inspection services, and
                                   (viii) Federal Government  inspected facility
                                   for export.

                                      F-10

<PAGE>



                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================



                                   The Company is a third party service provider
                                   and as such does not purchase  the  inventory
                                   that it  stores.  When the  Company  receives
                                   products   for   storage,   it  provides  the
                                   customer  with  a   nonnegotiable   warehouse
                                   receipt.  At that time,  the  customer pay an
                                   amount equivalent to one month of storage and
                                   handling  based  upon the type and  amount of
                                   product  accepted  at  the  beginning  of the
                                   30-day  period.  The  prepayment is accounted
                                   for  as  deferred   revenue.   The  Company's
                                   inventory control system monitors the product
                                   from  storage,  the customer  places an order
                                   with the Company, and the Company removes the
                                   product from the  warehouse  for the customer
                                   and  provides  the  customer  with a bill  of
                                   lading.   Revenue   is   recognized   ratably
                                   throughout  the  storage  period  and  billed
                                   monthly.

                                   In addition to its public warehouse business,
                                   the  Company  leases  refrigerated  space  to
                                   tenants who manage  their own  inventory  and
                                   logistics  functions  and  utilize  their own
                                   equipment and personnel. In almost all cases,
                                   the tenant pays all of the  expenses,  except
                                   for  utilities  and  property  taxes that are
                                   included in the rent. The terms of the leases
                                   may be  month  to  month  or as  long as five
                                   years.  The Company does not allow tenants to
                                   make any special  modifications to the leased
                                   space without the Company's prior approval.

                                   For the years  ended  December  31,  1999 and
                                   1998, public warehouse customers  represented
                                   approximately   92  and  93  percent  of  the
                                   Company's revenue, the remainder of which was
                                   attributable to leased space.  The Company is
                                   managed as a single business segment.

        Basis of Presentation      The consolidated financial statements include
                                   the   accounts   of    Alford    Refrigerated
                                   Warehouses,   Inc.   and   its   wholly owned
                                   subsidiaries:  Alford   Logistical  Services,
                                   Inc.    ("ALS"),     Thermix      Corporation

                                      F-11

<PAGE>



                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================


                                   ("Thermix"),       Specialty       Processing
                                   Corporation   ("SPC"),    Alford     Terminal
                                   Warehouses, Inc. ("ATW"), Alford Distribution
                                   Services,  Inc.  ("ADS"),  Cadiz  Properties,
                                   Inc. ("Cadiz"), and La Porte Properties,  LLC
                                   ("LPP").  All intercompany  transactions  and
                                   balances have been eliminated.

                                   The   Company   is   a   subsidiary of Castor
                                   Capital, Inc.

                                   Set forth below is  information  with respect
                                   to certain of the Company's  properties.  The
                                   industry measures space in cubic feet instead
                                   of  square  feet  because  cost   projections
                                   include   facility   height  to  account  for
                                   refrigeration and stacked cooled product.


<TABLE>
<CAPTION>

                                                                            Approximate                    Lease
                                                      Primary                  Size            Owned/      Expiration
                                 Location             Use                   (Unaudited)        Lease       Date
                                 -----------------------------------------------------------------------------------------
<S>                              <C>                  <C>                   <C>                <C>         <C>
                                 Dallas, Texas        Corporate office      24,000,000 cubic   Owned       N/A
                                                      & Warehouse           feet on 52 acres

                                 La Porte, Texas      Warehouse             4,500,000 cubic    Owned       N/A
                                                                            feet on 32.3
                                                                            acres

                                 Richardson, Texas    Warehouse             3,200,000 cubic    Leased      Dec. 31, 2007
                                                                            feet on 12.4
                                                                            acres

                                 Fort Worth, Texas    Warehouse             1,550,000 cubic    Owned May   N/A
                                                                            feet on 13.5       1999,
                                                                            acres              leased
                                                                                               prior to

</TABLE>

        Cash and Cash              For  purposes  of reporting  the consolidated
        Equivalents                statements   of  cash  flows,   the   Company
                                   considers all highly  liquid investments pur-
                                   chased  with  an  original maturity  of three
                                   months or less to be cash equivalents.

        Property, Plant and        Property, plant and equipment are  stated  at
        Equipment                  cost, less accumulated depreciation. The cost
                                   of     additions     and    improvements  are
                                   capitalized,  while  maintenance  and repairs
                                   are charged to expense when incurred.

                                      F-12

<PAGE>



                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================


                                   Depreciation of property, plant and equipment
                                   is calculated using the straight-line method.
                                   The  estimated  depreciable  lives range from
                                   three to seven years for most  machinery  and
                                   equipment and 31.5 years for buildings.

                                   Leased property  meeting certain  criteria is
                                   capitalized  and  the  present  value  of the
                                   related  lease  payments  is  recorded  as  a
                                   liability. Amortization of capitalized leased
                                   assets  is  computed  on  the   straight-line
                                   method over the term of the lease.

                                   Realization    of   long-lived    assets   is
                                   periodically   assessed  by  the  Company  to
                                   determine  if an  impairment  of the carrying
                                   value  of  the   assets  has   occurred.   If
                                   impairment  exists,  an  impairment  loss  is
                                   recognized,  by a  charge  against  earnings,
                                   equal to the  amount  by which  the  carrying
                                   amount of the asset exceeds the fair value of
                                   the  asset.  If  impairment  of an  asset  is
                                   recognized,  the carrying amount of the asset
                                   is reduced  by the amount of the  impairment,
                                   and a new basis for the asset is established.
                                   Such  new  basis  is  depreciated   over  the
                                   asset's remaining useful life.

        Income Taxes               The  Company  used  the  asset and  liability
                                   approach  for  accounting  for income  taxes.
                                   Deferred income  taxes are recognized for the
                                   tax    consequences    in    future  years of
                                   differences  between  the tax bases of assets
                                   and liabilities and their financial reporting
                                   amounts at  each  year-end  based on  enacted
                                   tax laws and statutory  tax rates  applicable
                                   to the periods in which the  differences  are
                                   expected to affect taxable income.  Valuation
                                   allowances are  established when necessary to
                                   reduce deferred tax assets to the amount  ex-
                                   pected to be realized.  Income tax expense is
                                   the tax payable for the period and the change
                                   during the period in  deferred tax assets and
                                   liabilities.

                                      F-13
<PAGE>



                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================


        Use of Estimates           The preparation  of  financial  statements in
                                   conformity with generally accepted accounting
                                   principles (GAAP) requires management to make
                                   estimates  and  assumptions  that  affect the
                                   reported  amounts of  assets and  liabilities
                                   and   disclosure   of  contingent  assets and
                                   liabilities  at  the date  of  the  financial
                                   statements  and   the  reported   amounts  of
                                   revenues and  expenses during  the  reporting
                                   period.   Actual  results  could  differ from
                                   these estimates.

        Earnings                   Per Share Basic  earnings per share have been
                                   computed based on the weighted average number
                                   of   common   shares   outstanding.   Diluted
                                   earnings per share reflects the increase,  if
                                   any, in the weighted  average  common  shares
                                   outstanding   that  would   result  from  the
                                   potential  dilutive  effect of unpaid  common
                                   stock  subscriptions.  For  the  years  ended
                                   December  31,  1999 and  1998,  there  was no
                                   dilution.

        Recent Accounting          In  June  1998,   the   Financial  Accounting
        Pronouncements             Standards Board  (FASB) issued  SFAS No. 133,
                                   "Accounting  for Derivative  Instruments  and
                                   Hedging    Activities",   which   establishes
                                   accounting   and   reporting   standards  for
                                   derivative     instruments     and    hedging
                                   activities.     It    requires     that    an
                                   entity  recognize all  derivatives  as either
                                   assets or  liabilities  in the balance  sheet
                                   and measure those  instruments at fair value.
                                   Implementation  of this standard has recently
                                   been  delayed  by  the  FASB  for a  12-month
                                   period  through the issuance of SFAS No. 137,
                                   "Accounting  for Derivative  Instruments  and
                                   Hedging   Activities   -   deferral   of  the
                                   effective  date of FASB  Statement  No. 133".
                                   SFAS No.  137 defers  the  effective  date of
                                   SFAS No. 133 to all fiscal quarters beginning
                                   after  June  15,  2000.  Management  does not
                                   believe  this will have a material  effect on
                                   the operations.

        Stock Subscriptions        Stock  subscriptions   and   note  receivable
        and Note Receivables       represent   the   unpaid   portion  of  stock
                                   subscription agreements  and an  advance made
                                   by   the   Company   for   the   purchase  of

                                      F-14
<PAGE>



                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================



                                   the Company's  common stock.  Stock subscrip-
                                   ions and note  receivables are presented as a
                                   reduction to stockholders' equity.

        Treasury  Stock            Treasury  stock  is  accounted  for under the
                                   cost method  and is  presented as a reduction
                                   to stockholders' equity.

        Reclassifications          Certain   prior   year   amounts   have  been
                                   reclassified  to conform to the current  year
                                   presentation.

2.      Related Party              On December 1, 1996, the Company entered into
        Transactions               an agreement ("the  Agreement")  with certain
                                   shareholders to repay  existing  loans and to
                                   purchase  their  Company  stock.   Among  the
                                   Agreement terms, the  Company  entered into a
                                   $2,600,000  term   note  due   December  2001
                                   secured  by  shares  of  the Company's common
                                   stock held in escrow.

                                   Effective  January  1,  1998,   Castor,   the
                                   Company's Parent, assumed the $2,600,000 note
                                   payable. The Company guaranteed the repayment
                                   of this note  payable.  At December 31, 1999,
                                   this  obligation   totaled   $2,100,000.   No
                                   liability  has been recorded in the Company's
                                   financial    statements   related   to   this
                                   guarantee.

                                   In  settlement  of  certain  amounts  owed by
                                   Castor, Alford accepted 500,000 shares of its
                                   common  stock  valued  at $3.50  per share or
                                   $1,750,000 in exchange for a reduction in the
                                   amount  owed.  The  500,000  shares have been
                                   recorded by the Company as treasury stock.

                                   The Company's due from affiliates consists of
                                   the following at December 31, 1999 and 1998:

                                      F-15
<PAGE>




                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================

<TABLE>
<CAPTION>

                                       Description                                  1999                 1998
                                 ----------------------------------------------------------------------------------

<S>                              <C>                                        <C>                  <C>
                                 8% promissory note from
                                 Castor, balance of principal
                                 and accrued interest due
                                 December 31, 2002 (see below)              $      1,452,502     $     1,676,655

                                 Advances to Castor (see below)                      396,424             396,424

                                 Advances to affiliate, guaranteed by                350,000             140,000
                                 Castor
                                 ----------------------------------------------------------------------------------

                                                                            $      2,198,926     $     2,213,079
                                 ==================================================================================



                                   The note and  advances  due from  Castor  are
                                   secured  by 500,000  shares of the  Company's
                                   stock.

3.      Property, Plant and        The Company's  property, plant and  equipment
        Equipment                  consists of the December 31, 1999 and 1998:

                                                                                        1999               1998
                                 ---------------------------------------------------------------------------------

                                 Land                                       $      5,539,136     $    4,939,136
                                 Building                                         15,351,782         12,707,043
                                 Machinery and equipment                           2,855,281          2,656,873
                                 Machinery and equipment under
                                      capital leases                               1,720,753          1,595,040
                                 ---------------------------------------------------------------------------------

                                                                                  25,466,952         21,898,092
                                 Less accumulated depreciation                     4,044,571          3,140,413
                                 ---------------------------------------------------------------------------------

                                 Total                                      $     21,422,381     $   18,757,679
                                 ---------------------------------------------------------------------------------
</TABLE>


                                      F-16
<PAGE>




                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================


                                   Included  in  accumulated   depreciation   is
                                   approximately   $331,000   and   $240,000  of
                                   accumulated depreciation related to machinery
                                   and  equipment   under   capital   leases  at
                                   December 31, 1999 and 1998, respectively.

                                   During  May  1999,  the  Company  acquired  a
                                   refrigerated  warehouse  and the related land
                                   located in Fort  Worth,  Texas for a purchase
                                   price  of  $3,000,000.   The  purchase  price
                                   consisted   of   the   Company   securing   a
                                   $2,100,000  mortgage  loan  with a  financial
                                   institution  along with 400,000 shares of the
                                   Company's common stock.

4.      Income Taxes               Income  tax  expense  for the  years  ended
                                   December 31, 1999 and 1998 was as follows:


<TABLE>
<CAPTION>

                                                                                  1999                 1998
                                 ---------------------------------------------------------------------------------
<S>                              <C>                                      <C>                  <C>
                                 Current tax expense                      $         28,000     $         65,000
                                 Deferred tax expense                              398,000              296,000
                                 ---------------------------------------------------------------------------------

                                 Total income tax expense                 $        426,000     $        361,000
                                 ---------------------------------------------------------------------------------

</TABLE>

                                      F-17

<PAGE>


                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================



                                   A  reconciliation  between the actual  income
                                   tax  expense  and income  taxes  computed  by
                                   applying  the  statutory  federal  income tax
                                   rate to earnings before income taxes follows:


<TABLE>
<CAPTION>


                                                                                      1999                 1998
                                 ---------------------------------------------------------------------------------
<S>                              <C>                                      <C>                   <C>
                                 Computed income taxes, at
                                      34 percent                          $        371,000      $       399,000
                                 Utilization of net operating loss
                                      carryforwards                                      -             (103,000 )
                                 Alternative minimum tax and
                                      franchise taxes                               28,000               65,000
                                 Other, net                                         27,000                    -
                                 ---------------------------------------------------------------------------------

                                                                          $        426,000      $       361,000
                                 ---------------------------------------------------------------------------------

                                   The  components of the deferred tax asset and
                                   liability  at December 31, 1999 and 1998 were
                                   approximately as follows:

                                                                                        1999                1998
                                 ---------------------------------------------------------------------------------

                                 Deferred tax liability:
                                      Accelerated depreciation              $     (1,009,000)           (940,000)
                                                                                                 $

                                 Deferred tax asset:
                                      Net operating losses                           833,000           1,162,000
                                 ---------------------------------------------------------------------------------

                                 Net deferred tax asset (liability)         $       (176,000)    $       222,000
                                 =================================================================================
</TABLE>

                                   At  December  31,   1999,   the  Company  had
                                   potential net operating loss carryforwards of
                                   approximately    $7,915,000,    which    have
                                   expiration  dates  ranging  from 2003 through
                                   2006. A valuation  allowance of approximately
                                   $1,676,000   exists  for  NOL   carryforwards
                                   totaling    approximately    $4,928,000   not
                                   anticipated to be realized before  expiration
                                   because of an  utilization  limitation  under
                                   IRC   Section   382.    Management   believes
                                   realization  of the  entire net asset is more
                                   likely  than  not  based  on  future   income
                                   projections.

                                      F-18

<PAGE>


                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================


5.      Notes Payable, Long-Term   Notes payable  consists of  various notes due
        Debt, and Line of Credit   to insurers  with  $121,751  and  $117,768 at
                                   December 31, 1999 and 1998 respectively.  The
                                   notes  accrue  interest   at  various  rates;
                                   principal and interest are due monthly. Also,
                                   included  in  notes  payable  at December 31,
                                   1999, is a  7 percent note  payable  totaling
                                   $204,185 due to the  Company's legal counsel,
                                   with a maturity date of December 31, 2000 and
                                   an  8  percent  note  payable  to  an officer
                                   totaling  $25,176  with  a  maturity  date of
                                   May 1, 2000.

                                   The Company's  long-term debt consists of the
                                   following:


<TABLE>
<CAPTION>


                                                 Description                            1999               1998
                                 ---------------------------------------------------------------------------------
<S>                              <C>                                                <C>                <C>
                                 8.4% Morgan  Guaranty Trust Company of New York
                                      note,  monthly  payments of principal  and
                                      interest of $69,782,  remaining balance of
                                      principal and accrued interest due October
                                      2007, secured by the land and improvements
                                      and certain  other  property and equipment
                                      at the Company's Cadiz Street facility        $    7,728,375    $     7,908,283

                                 8.36% Amresco Capital, L.P. note, monthly pay-
                                      ments of principal and interest due
                                      March 2008, secured by the land and
                                      improvements and certain other property
                                      and equipment at the Company's La Porte,
                                      Texas facility                                     5,292,784          5,355,641

                                      F-19

<PAGE>


                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================


                                 Primeplus .50% Bank One,  Texas  N.A.  note (9%
                                      at December 31, 1999),  monthly  principal
                                      and   interest    payments   of   $11,667,
                                      remaining balance of principal and accrued
                                      interest due May 2002, secured by the land
                                      and  improvements  of the  Company's  Fort
                                      Worth,  Texas  facility and certain  other
                                      property and equipment and guaranties from
                                      Castor, ALS, Thermix, SPC, ATW and ADS             2,018,331                  -

                                8% Bank One, Texas N.A., Master Lease Agreement,
                                      monthly principal and interest payments of
                                      $32,514 through April 2006, secured by
                                      listed equipment at the Company's  Cadiz
                                      Street Facility, La Porte, Texas,
                                      Richardson, Texas and Fort Worth,  Texas
                                      facilities, and guaranties from Castor,
                                      ALS, Thermix, SPC, ATW and ADS                     1,914,094                  -

                                 Obligations under capital leases,
                                      maturity dates ranging from
                                      2000 through 2004                                    760,619          1,086,504


                                      F-20

<PAGE>


                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================


                                 Nations  Credit  Commercial   Corporation  term
                                      note,  prime  plus 5%,  monthly  principal
                                      payments of $20,119 plus accrued interest,
                                      secured   by   selected    equipment   and
                                      guaranties from Castor, ALS, Thermix, SPC,
                                      ATW, and ADS                                               -            965,760

                                 Other                                                           -            152,799
                                 --------------------------------------------------------------------------------------
                                                                                        17,714,203         15,468,987
                                 Current maturities                                       (963,885)        (1,072,415)
                                 --------------------------------------------------------------------------------------

                                                                                    $   16,750,318    $    14,396,572
                                 ======================================================================================

</TABLE>

                                 Maturities of long-term debt follows:
<TABLE>
<CAPTION>

                                 Year ended December 31,
                                 -----------------------------------------------------------------------------------
<S>                              <C>                                                               <C>
                                 2000                                                              $      963,885
                                 2001                                                                     959,602
                                 2002                                                                   2,487,585
                                 2003                                                                     676,784
                                 2004                                                                     719,866
                                 Thereafter                                                            11,906,481
                                 -----------------------------------------------------------------------------------

                                                                                                   $   17,714,203
                                 ===================================================================================

</TABLE>

                                   Included in the above maturities of long-term
                                   debt are capital lease principal  payments of
                                   approximately  $560,000 in 2000,  $531,000 in
                                   2001,  $435,000  in 2002,  $336,000  in 2003,
                                   $350,000  in 2004  and  $463,000  thereafter.
                                   Interest   expense   related  to  the  future
                                   capital lease  obligations  is  approximately
                                   $602,000.

                                   The Morgan Guaranty Trust Company of New York
                                   and the Amresco  Capital,  L.P. notes payable
                                   require  certain escrow accounts and restrict


                                      F-21

<PAGE>


                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================

                                   the  use  of  the  funds  to  the  designated
                                   purpose of the  accounts in  accordance  with
                                   the terms of the note.

                                   The loan  agreement with Bank One, Texas N.A.
                                   contains various restrictive  covenants.  The
                                   Company was in technical  default of its Cash
                                   Flow Coverage Ratio at December 31, 1999. The
                                   Company  obtained a waiver  pertaining to its
                                   1999 Cash Flow Coverage Ratio default.

                                   During May 1999,  the Company  refinanced its
                                   line of credit  with Bank  One,  Texas  N.A.,
                                   which  provides up to $2,500,000  through May
                                   1, 2000 at prime plus 1 percent (9.50 percent
                                   at December  31,  1999).  Interest is payable
                                   monthly,  and all unpaid but accrued interest
                                   and principal is due at maturity. The line of
                                   credit is secured by guaranties  from Castor,
                                   ALS, Thermix,  SPC, ATW, and ADS. The Company
                                   has  obtained  the  financial   institution's
                                   commitment  and intent to extend the due date
                                   to May 1,  2001.  Accordingly,  the  line  of
                                   credit is presented as non-current.

6.      Commitments and            The Company  rents certain  real  estate  and
        Contingencies              equipment under operating leases.  The leases
                                   do not provide for any significant  renewals;
                                   and, except for insignificant  leases,  there
                                   are  no  existing   purchase  options.   Rent
                                   expense was $884,753 and  $1,577,129  for the
                                   years ended  December 31, 1999 and 1998, res-
                                   pectively.

                                   Future minimum rental payments required under
                                   operating   leases   that  have   initial  or
                                   remaining noncancelable lease terms in excess
                                   of one  year  at  December  31,  1999  are as
                                   follows:

                                      F-22
<PAGE>




                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================



                                 Year ended December 31,              Amount
                                 -----------------------------------------------

                                 2000                             $      625,000
                                 2001                                    613,000
                                 2002                                    605,000
                                 2003                                    600,000
                                 2004                                    600,000
                                 Thereafter                            1,800,000
                                 -----------------------------------------------

                                                                  $    4,843,000
                                 ===============================================

                                   From time to time,  in the  normal  course of
                                   business,  the  Company is a party to various
                                   matters of  litigation.  Management is of the
                                   opinion that the eventual resolution of these
                                   matters  will  not  have a  material  adverse
                                   effect on the Company.

                                   The  Company   guaranteed  an  obligation  of
                                   Castor. At December 31, 1999, this obligation
                                   totaled  $2,100,000.  No  liability  has been
                                   recorded   in   the    Company's    financial
                                   statements related to this guarantee.

                                   The  Company  executed an  "Exclusive  Option
                                   Contract" for the purchase of the  Richardson
                                   facility for  $6,000,000.  The option  period
                                   expired on February 22, 2000.  The Company is
                                   continuing  to  negotiate  with the seller in
                                   regards  to the  purchase  of the  Richardson
                                   facility.

7.      Concentration  of          At December 31, 1999 and  1998,  the  Company
        Credit Risk                in excess of Risk federally insured limits of
                                   approximately  $55,000 and $45,000,  respect-
                                   ively.

                                   During  1999 and  1998,  no  single  customer
                                   provided  greater  than  10  percent  of  the
                                   Company's   revenues.   The  Company  closely
                                   monitors   the    creditworthiness   of   its
                                   customers  and  does not  believe  that it is
                                   dependent upon any single customer.

                                      F-23
<PAGE>




                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================



8.      Supplemental Cash Flow     Cash paid for interest during the years ended
        Information                December 31, 1999  and 1998 was approximately
                                   $1,592,000   and   $1,385,000,  respectively.
                                   Cash paid for income  taxes  during the years
                                   ended December 31, 1999 and 1998 was approxi-
                                   mately  $13,000 and $6,000, respectively.

                                   Noncash  investing  and  financing   activity
                                   during   1999  and  1998   consists   of  the
                                   following:
<TABLE>
<CAPTION>

                                                                                      1999               1998
                                 ----------------------------------------------------------------------------------
<S>                              <C>                                          <C>                 <C>
                                 Financing of various insurance
                                      policies (Note 5)                       $        394,358    $       385,822
                                 Capitalization of leased assets and
                                      obligations (Note 5)                             129,672          1,191,228
                                 Debt reduction in exchange for
                                      receivable reduction (Note 2)                          -          2,600,000
                                 Issuance of common shares for
                                      services, pursuant to merger
                                      agreement                                              -             10,000
                                 Issuance of 400,000 shares in
                                      connection with the
                                      acquisition of a refrigerated
                                      warehouse and land                               900,000                  -
                                 Return of 500,000 shares in
                                      satisfaction of amount due
                                      from affiliate                                 1,750,000                  -

</TABLE>

                                      F-24

<PAGE>




                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================




9.      Rental Income Under        The Company's  operations include the leasing
        Operating Leases           of space to third parties in their commercial
                                   warehouses.  The following  is a  schedule of
                                   minimum  future   rental   income   on   non-
                                   cancelable operating  leases at  December 31,
                                   1999:

                                 Year ended December 31,                Amount
                                 -----------------------------------------------

                                 2000                             $      703,000
                                 2001                                    208,000
                                 2002                                     26,000
                                 2003                                     18,000
                                 2004                                     15,000
                                 -----------------------------------------------
                                                                  $      970,000
                                 ===============================================

10.     Description of             Each  share  of  Common  Stock  entitles  the
        Securities                 holder thereof to  one vote on all matters on
                                   which holders are permitted  to vote.  No
                                   shareholder has any preemptive right or other
                                   similar right to purchase  or  subscribe  for
                                   any  additional   securities  issued  by  the
                                   Company, and no shareholder  has any right to
                                   convert Common Stock into  other  securities.
                                   No shares of Common Stock are subject to  re-
                                   demption or to any sinking fund provisions.

                                   Subject  to rights of  holders  of  Preferred
                                   Stock,  if any,  the  holders  of  shares  of
                                   Common Stock are entitled to dividends  when,
                                   as and if declared by the Board of  Directors
                                   from funds  legally  available  therefor and,
                                   upon liquidation,  to a pro rata share in any
                                   distribution  to  shareholders.  The  Company
                                   does not  anticipate  declaring or paying any
                                   cash  dividends  on the Common Stock in 2000.
                                   The  Company  must obtain  approval  from its
                                   lenders prior to paying dividends in order to
                                   remain  in   compliance   with  various  loan
                                   covenants.

                                      F-25

<PAGE>


                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================




                                   Pursuant   to  the   Company's   Amended  and
                                   Restated Articles of Incorporation, the Board
                                   of Directors has the authority to provide for
                                   the  issuance  of up to  5,000,000  shares of
                                   Preferred  Stock in one or more series and to
                                   determine  the  dividend  rights,  conversion
                                   rights,  voting  rights,  rights and terms of
                                   redemption,   liquidation  preferences,   the
                                   number of shares constituting any such series
                                   and the  designation of such series.  Because
                                   the  Board  of  Directors  has the  power  to
                                   establish the  preferences and rights of each
                                   series,  it may  afford  the  holders  of any
                                   Preferred  Stock   preferences,   powers  and
                                   rights  (including  voting  rights) senior to
                                   the rights of the holders of Common Stock. No
                                   shares  of  Preferred   Stock  are  currently
                                   outstanding.

11.     Stock Subscription and     During 1999, the Company entered into stock
        Other Receivables          subscription shares of its common stock  at a
                                   price  of  $4.50  per  share  for a  total of
                                   $630,000.  At the date the stock subscription
                                   agreements  were  entered  into,  the Company
                                   received initial payments  totaling  $90,000.
                                   The  balance of  $540,000  is recorded by the
                                   Company  as a stock  subscription  receivable
                                   and has been  presented  as a reduction  from
                                   stockholders' equity at December 31, 1999.

                                   The   Company   received  a   $400,000   note
                                   receivable in May 1999 that, through a series
                                   of  transactions,   was  ultimately  for  the
                                   purchase of the Company's stock. The $400,000
                                   note  is  presented   as  a  reduction   from
                                   stockholders' equity at December 31, 1999.

12.     Fair Value of Financial    The methods and assumptions  used to estimate
        Instruments                the  fair  value  of  each class of financial
                                   instrument are as follows:

                                   Cash and cash equivalents, trade receivables,
                                   certain other current assets,  notes payable,
                                   accounts payable,  and current  maturities of
                                   long-term   debt.   The   carrying    amounts
                                   approximate  fair value  because of the short
                                   maturity of these instruments.

                                      F-26
<PAGE>


                      ALFORD REFRIGERATED WAREHOUSES, INC.

                   Notes to Consolidated Financial Statements

================================================================================


                                   Long-term  receivables.  The  fair  value  of
                                   long-term receivables was based on discounted
                                   cash  flows  or  other  specific   instrument
                                   analysis   and   approximated   the  carrying
                                   amounts.

                                   Long-term  debt. The carrying  amounts of the
                                   Company's bank borrowings under its revolving
                                   credit  agreement   approximates  fair  value
                                   because  the   interest   rate  is  based  on
                                   floating  rates  identified  by  reference to
                                   market   rates.   The  fair   values  of  the
                                   Company's   other   long-term   debt   either
                                   approximate  carrying  value or are estimated
                                   based on quoted market prices for the same or
                                   similar   issues  or  on  the  current  rates
                                   offered to the  Company  for debt of the same
                                   remaining maturities.

                                         December           1999        1998
                                 -----------------------------------------------

                                 Carrying amount     $ 16,750,318   $ 14,396,572
                                 Fair value            15,993,247     14,253,000
                                 -----------------------------------------------

                                      F-27
<PAGE>

Item 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

During the  registrant's  two most recent  Fiscal years and  subsequent  interim
periods,  neither an independent  accountant  who was previously  engaged as the
principal  accountant to audit the  registrant's  financial  statements,  nor an
independent  accountant  who was  previously  engaged  to  audit  a  significant
subsidiary  and on whom  the  principal  accountant  expressed  reliance  in its
report,  has  resigned (or  indicated  it has declined to stand for  re-election
after the completion of the current audit) or was dismissed.

                                    PART III

Item 9.  COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT; DIRECTORS, EXECUTIVE
         OFFICERS, PROMOTERS AND CONTROL PERSONS

Set forth  below is  certain  information  regarding  the  directors,  executive
officers and significant  employees of the Company. Each of the directors of the
Company will serve until the next annual  meeting of  shareholders  or until his
successor  is elected  and  qualified.  Executive  officers  of the  Company are
elected  by the  Board  of  Directors  to hold  office  until  their  respective
successors are elected and qualified.
<TABLE>
<CAPTION>

         Name                                     Age                                    Position(s)
         ----                                     ---                                    -----------
<S>      <C>                                      <C>                            <C>
         Alton M. Adams                           61                             Chief Executive Officer
         Michael A. Oros                          64                             President and Director
         James C. Williams                        42                             Vice President; Chief Financial
                                                                                 Officer, Treasurer and Director
         Joseph Y. Robichaud                      72                             Director
         Kenneth M. Tomilson                      66                             Director
         John C. Crawford                         63                             Director (independent)
         Len Ebersberger                          60                             Director (independent)

</TABLE>


Set forth below is a description of the backgrounds of the directors,  executive
officers and significant employees of the Company.

Joseph Y.  Robichaud has served as a Director of the Company since December 1996
and  from  March  1994 to July  1995.  Mr.  Robichaud  is also on the  board  of
directors  and  serves as the  chairman  and chief  executive  officer of Castor
Capital  Corporation.  From  1966 to  1995,  Mr.  Robichaud  was  chairman  and,
indirectly,  principal  shareholder of Odyssey  Industries,  Inc., which was the
sole shareholder of Associated Freezers of Canada, Inc., an operating company in
the  business of owning and  operating  frozen food  warehousing  facilities  in
Canada and  Australia.  In 1994, a dispute  arose  between  Odyssey and its bank
lender  concerning  currency exchange rates affecting the repayment of Odyssey's
loan.  At the request of the bank, a receiver was  appointed for Odyssey and the
receiver  subsequently  placed  Odyssey into  bankruptcy and sold the profitable
operations of Associated  Freezers of Canada,  Inc. Mr.  Robichaud  received his
Bachelor  of Science  degree in Civil  Engineering  from the  University  of New
Brunswick in 1950. Mr. Robichaud is the brother-in-law of Mr. Tomilson.


                                       13


Kenneth M. Tomilson has served as a Director of the Company since December 1996.
Mr. Tomilson is also the president of Castor Capital  Corporation and has served
in that position since 1995.  From 1964 to the present,  Mr. Tomilson has served
as president of Engineering  Design & Construction  Managers Ltd. which provides
design services,  engineering,  construction  supervision and management for low
and high-rise residential,  commercial and industrial buildings, food processing
and refrigerated warehousing. Prior to 1995, Mr. Tomilson was vice president and
a director of Odyssey Industries,  Inc. In 1994, a dispute arose between Odyssey
and its bank lender  concerning  currency exchange rates affecting the repayment
of Odyssey's  loan.  At the request of the bank, a receiver  was  appointed  for
Odyssey and the  receiver  subsequently  placed  Odyssey  into  bankruptcy.  Mr.
Tomilson is a member of The Canadian Standards  Association  Technical Committee
responsible  for  setting   standards  and  formulating   codes  for  mechanical
refrigeration  in Canada.  Mr.  Tomilson  graduated  from the  University of New
Brunswick  with a Bachelor of Science  degree in Civil  Engineering in 1958. Mr.
Tomilson is the  brother-in-law of Mr. Robichaud and is also the  brother-in-law
of Mr. Adams.

Alton M. Adams has served as the Chief  Executive  Officer of the Company  since
January  1997.  Mr.  Adams also  currently  serves as vice  president  of Castor
Capital  Corporation,  a position which he has held since  September  1995. From
April  1995 to  April  1996,  Mr.  Adams  served  as  president  of  Polar  Corp
International.  From 1984 to 1995, he served as president of Associated Freezers
of  Canada,  Inc.,  and  during  that  time,  was  also a  director  of  Odyssey
Industries,  Inc.,  which was the sole  shareholder  of  Associated  Freezers of
Canada,  Inc.  In 1994,  a dispute  arose  between  Odyssey  and its bank lender
concerning currency exchange rates affecting the repayment of Odyssey's loan. At
the request of the bank, a receiver was  appointed  for Odyssey and the receiver
subsequently  placed Odyssey into bankruptcy and sold the profitable  operations
of Associated  Freezers of Canada,  Inc. Mr. Adams graduated from the University
of New Brunswick with a Bachelor of Science degree in Electrical  Engineering in
1960,  earned a master of science degree in 1963 in Electrical  Engineering from
Queen's  University  and a master  of arts  degree  in  Political  Science  from
Canadian Forces Staff College in 1968.

Michael A. Oros has served as  President of the Company  since  January 1997 and
has served as a Director of the Company  since June 1999.  He also served as its
chief  operating  officer from January 1997 until December 1998. From 1986 until
1996,  Mr. Oros served as president  and chief  operating  officer of Associated
Freezers, Inc. Mr. Oros is a member of International Association of Refrigerated
Warehousemen,  the North Texas Warehouse  Association,  the American Frozen Food
Institute,  the Meat Importers  Council,  the Southwest Meat Association and the
National Frozen Food Association.

James C.  Williams  has  served  as Vice  President,  Chief  Financial  Officer,
Secretary and Treasurer of the Company since December 1996.  Prior to that time,
from October 1995 until April 1997,  Mr.  Williams  served as vice  president of
finance for Castor Capital  Corporation and from June 1987 until October 1995 as
the controller for Associated  Freezers of Canada,  Inc. Mr.  Williams is on the
Maves Advisory Board. He graduated from the University of Waterloo Co-op Program
in 1982 with a bachelor of mathematics  degree.  Mr. William's degree included a
major in mathematics and minors in computer science and accounting.

Dr. John C.  Crawford  has served as a Director of the Company  since June 1999.
For the past 18 years,  Dr.  Crawford  has served as a professor of marketing at
the University of North Texas at Denton, Texas.

Len  Ebersberger  has served as a Director of the Company  since June 1999.  For
more  than the  past 5  years,  Mr.  Ebersberger  has  served  as  president  of
Refrigerated  Warehouse  Consultants,  Inc. From 1986 to 1991,  Mr.  Ebersberger
served as president of Burris Refrigerated Services.  From 1971 to 1978 and from

                                       14

<PAGE>

1984 to 1986, Mr.  Ebersberger  served as vice president of operations of United
Refrigerated  Services.  Prior to that time, from 1965 to 1971, Mr.  Ebersberger
worked for E.I. duPont deNemours Co. For the last five years, Mr. Ebersbeger has
continued  as an  instructor  in  "Refrigerated  Warehouse  Technology"  at  the
Refrigerated  Research &  Education  Foundation's  school at the  University  of
Oklahoma.  Mr.  Ebersberger  has  served  on the  Board  of  Governors  of  that
Foundation as well as on the Board of Directors of the International Association
of Refrigerated  Warehouses.  Mr.  Ebersberger  graduated from the United States
Naval  Academy in 1961 and  attended  John  Hopkins  University  for pre law and
received  a  degree  in  Business  Administration  from  Southwest  Texas  State
University.

Due to the broad experience of the Company's executive  officers,  directors and
key personnel in the  refrigerated  warehousing  industry,  the Company does not
believe that the loss of any one of them would have a material adverse effect on
its  business.  None of the  executive  officers  currently  have an  employment
agreement with the Company,  however,  Mr. Adams has a consulting contract which
automatically  renews on an annual  basis and  provides  for a fee of $8,000 per
month for services rendered.

Committees of the Board of Directors

The Audit  Committee  of the  Company is  comprised  of Joseph  Robichaud,  John
Crawford and Len Ebersberger.

Item 10. EXECUTIVE COMPENSATION

Executive Compensation

The following  table sets forth the cash and non-cash  compensation  paid by the
Company to its chief executive officer and its two other most highly compensated
executive  officers for the fiscal years ended December 31, 1999, 1998 and 1997.
None of the  Company's  other  officers or directors  received  cash or non-cash
compensation in excess of $100,000 for the fiscal year ended December 31, 1998.

<TABLE>
<CAPTION>

                           SUMMARY COMPENSATION TABLE

                                                                   Long-Term
                                                                 Compensation
                                  Annual Compensation               Awards
    Name and                  ---------------------------    --------------------       All Other
Principal Position                  Year     Salary           Bonus      Options     Compensation(1)
-------------------                ------   --------         -------    ---------    ---------------
<S>                                 <C>     <C>              <C>           <C>            <C>
Mr. Adams                           1999                                                  96,000
Chief Executive Officer             1998                                                  96,000
                                    1997                                                  96,000
Mr. Oros                            1999    100,000          25,000
President                           1998    100,000          25,000
                                    1997    100,000          25,000
<FN>
--------------------------------------------------------------------

(1)  These amounts were paid pursuant to a consulting  contract and were paid by
the Company  directly  to Mr.  Adams in 1997 and to Castor  Capital  Corporation
which paid Mr. Adams in 1998 and 1999.

</FN>
</TABLE>

In addition to the  officers  listed  above,  Mr.  George  Gilman  served as the
president and secretary of Hilltop Acquisition Holding Corporation from February
18, 1998 until  December  15, 1998 when it merged with  Alford.  Mr.  Timothy T.

                                       15
<PAGE>

Halter  served  as  president  and  secretary  of  Hilltop  Acquisition  Holding
Corporation prior to Mr. Gilman.  Neither Mr. Gilman nor Mr. Halter received any
compensation for services rendered to Hilltop from 1996 through 1998.

Director Compensation

Directors  who  are  employees  of  the  Company  will  not  receive  additional
compensation  for serving as directors.  Independent  directors  will receive an
annual fee established by the Board of Directors of $5,000 and a fee of $500 for
attending  each meeting of the Board of Directors or any  committee of the Board
of  Directors.  All  directors  will be reimbursed  for  out-of-pocket  expenses
incurred in attending  meetings and for other expenses incurred in performing in
their capacity as directors.

Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain  information as of December 31, 1999 with
regard to the  beneficial  ownership of Common Stock by (i) each person known to
the Company to be the beneficial  owner of 5% or more of its outstanding  Common
Stock,  (ii) the officers and directors of the Company  individually,  and (iii)
the officers and directors of the Company as a group.  All addresses are in care
of the Company, 318 Cadiz Street, Dallas, Texas 75207.

<TABLE>
<CAPTION>

                  Name                      Title of Class    Number of Shares Owned             Percent
                  ----                      --------------    ----------------------             -------
<S>      <C>                                <C>                        <C>                         <C>
         Joseph Y. Robichaud(1)             Common Stock               5,561,372                   79.0%
         Castor Capital Corporation         Common Stock               5,561,372                   79.0%
         Directors and executive            Common Stock               5,561,372                   79.0%
           officers as a group (7 persons)

<FN>

(1)      All of these  shares  are held by  Castor  Capital  Corporation.  The sole  shareholder  of  Castor is the
         Robichaud  Family Trust,  of which Mr.  Robichaud is the trustee.  Mr.  Robichaud is also the chairman and
         chief executive officer of Castor.
</FN>
</TABLE>

Castor  Capital   Corporation  is  the  owner  of  approximately  79.0%  of  the
outstanding shares of the Common Stock and as such is able to elect the board of
directors  and  determine  the outcome of other  matters  requiring  shareholder
action without the concurrence of any other shareholder. The sole shareholder of
Castor Capital Corporation is the Robichaud Family Trust, of which Mr. Robichaud
is trustee.  Mr.  Robichaud is also the chairman and chief executive  officer of
Castor.

Item 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

On or about December 1, 1996,  Alford entered into an agreement with Canfina AG,
a company  organized  under the laws of  Switzerland,  and J.  Eichmann to repay
existing loans to Canfina AG in the original  principal amount of $6,700,000 and
to  purchase  all of the shares of stock of Alford  owned by Mr. J.  Eichmann in
exchange for $2,000,000. As of December 1, 1996, Mr. Eichmann owned 5,000 shares
(the  equivalent  of 3,275,686  shares  after the reverse  merger) or 50% of the
issued and outstanding  capital stock of Alford (the "Eichmann  Shares").  On or
about December 4, 1997,  Alford paid to Mr. Eichmann  $2,000,000 in exchange for
rights to the Eichmann Shares using funds obtained  through a term note and line
of credit. Alford's rights to the Eichmann Shares were subsequently  transferred
by Alford to Alford's  parent,  Castor  Capital  Corporation,  in exchange for a
$2,000,000  note  receivable.  On or about December 15, 1998, in connection with
the  merger  of Alford  with and into the  Company,  the  Eichmann  Shares  were

                                       16

<PAGE>

converted into 3,275,686  shares of the Company,  all of which are being held in
escrow  pending the final  payment due to Mr.  Eichmann in December  2001. As of
December 31, 1999, the outstanding principal balance on the note was $2,100,000.
Castor Capital Corporation has assumed the liability for this note.

On or about  February 6, 1998,  Alford leased a warehouse  facility in La Porte,
Texas at market rates from La Porte  Properties,  LLC, a Texas limited liability
company ("La Porte"),  which was a wholly owned subsidiary of Alltemp Logistical
Services,  L.L.C., a Texas limited liability company ("Alltemp").  At that time,
Alltemp was a wholly owned subsidiary of Castor Capital  Corporation.  Effective
November 30, 1998, Alltemp was merged with and into Alford.

In 1997, Alford made two loans to its parent, Castor Capital Corporation.  On or
about  September  17, 1997,  Alford loaned  Castor  $1,500,000,  and on or about
December  4, 1997,  Alford  loaned  Castor  $2,000,000.  Each of these  loans is
evidenced by a promissory  note bearing  interest at a rate of eight percent per
annum.  The notes are due December 31, 2000 and December 31, 2002. In settlement
of certain amounts owed by Castor,  Alford accepted 500,000 shares of its common
stock  during 1999  valued at $3.50 per share or  $1,750,000  in exchange  for a
reduction  in the amount  owed.  The 500,000  shares  have been  recorded by the
Company  as  treasury  stock.  As of  December  31,  1999,  the total  amount of
principal  and interest  payable to the Company by Castor  pursuant to these two
notes was $1,452,502.  Mr. Robichaud,  a Director of the Company, is the trustee
of the Robichaud  Family Trust which is the sole  shareholder  of Castor Capital
Corporation.

In 1997 and 1998,  Alford paid to  Associated  Freezers,  Inc. an  aggregate  of
$475,903 for the rights to certain  trademarks  consisting  of a penguin and the
name  Associated  Freezers,  Inc. At that time,  Associated  Freezers,  Inc. was
indirectly owned 100% by Mr. Robichaud.  Effective November 30, 1998, Associated
Freezers,  Inc.  was merged with and into its parent  which was then merged with
and into Alford.

Engineering  Design &  Construction  Managers  Ltd.  ("EDCM") is a company which
specializes  in  the  design,   construction  and  maintenance  of  refrigerated
warehouse facilities.  EDCM is owned in equal proportions by Mr. Robichaud,  Mr.
Tomilson,  Mr. Adams and Mr. Paul Haines. EDCM has provided maintenance services
to the Company for which it billed the Company on a per diem basis.  The Company
and EDCM  were in the  process  of  formalizing  a new  agreement,  in the first
quarter of 1999,  which they  intended to make  effective as of January 1, 1999.
This agreement was not consummated.

Castor Capital  Corporation owns approximately 79.0% of the Company's issued and
outstanding  Common  Stock.  Mr.  Robichaud,  a director of the Company,  is the
trustee  of the  Robichaud  Family  Trust  which  owns  all of  the  issued  and
outstanding stock of Castor Capital Corporation.

Item 13. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

Financial Statement

The  consolidated  financial  statements  are contained  herein as listed on the
"Index" on page F-2 hereof. Reports on Form 8-K

There  were no  Current  Reports  on Form 8-K filed by the  Company  during  the
quarter ended  December 31, 1999 that have not been  previously  reported in the
Company's Quarterly Reports on Form 10-QSB.

                                       17

<PAGE>


<TABLE>
<CAPTION>

Description and Index of Exhibits

--------------------------------------------------------------------------------------------------------------------------------
Number                             Description                                                                         Page
--------------------------------------------------------------------------------------------------------------------------------
<S>                                <C>                                                                                   <C>
2.1                                First Amended Joint Plan of Reorganization dated July 9, 1996 as modified and         N/A
                                   clarified to date. (1)
--------------------------------------------------------------------------------------------------------------------------------
2.2                                Agreement of Plan of Merger dated November 23, 1998 by and between Hilltop            N/A
                                   Acquisition Holding Corporation, Womack Gilman Investment Services, L.C., Halter
                                   Financial Group, Inc. and Alford Refrigerated Warehouse, Inc. (1)
--------------------------------------------------------------------------------------------------------------------------------
3(i)                               Restated Articles of Incorporation (with Amendments) (2)                              N/A
--------------------------------------------------------------------------------------------------------------------------------
3(ii)                              Amended and Restated Bylaws (2)                                                       N/A
--------------------------------------------------------------------------------------------------------------------------------
4.1                                Form of Common Stock Certificate (1)                                                  N/A
--------------------------------------------------------------------------------------------------------------------------------
10.1                               Fixed Rate Note dated September 15, 1997 between Cadiz Properties, Inc., and          N/A
                                   Morgan Guaranty Trust Company of New York (1)
--------------------------------------------------------------------------------------------------------------------------------
10.2                               Fixed Rate Note dated February 6, 1998 between La Porte Properties, L.L.C., and       N/A
                                   Amresco Capital, L.P. (1)
---------------------------------------------------------------------------------------------------------------------------------
10.3                               Consulting Agreement dated January 1, 1997 between Alford Refrigerated                N/A
                                   Warehouses, Inc. and Alton M. Adams, P. Eng. (1)
---------------------------------------------------------------------------------------------------------------------------------
10.4                               Purchase and Sale Agreement executed on or about January 19, 1999 between Alford      N/A
                                   Refrigerated Warehouses, Inc. and Fort Worth Cold Storage Holdings, Inc. (1)
---------------------------------------------------------------------------------------------------------------------------------
10.5                               Consulting Agreement dated March 29, 1999 between Alford Refrigerated Warehouses,     N/A
                                   Inc. and Engineering Design and Construction Managers Limited (1)
---------------------------------------------------------------------------------------------------------------------------------
21.1                               Subsidiaries of the Company (1)                                                       N/A
---------------------------------------------------------------------------------------------------------------------------------
25                                 Power of Attorney (included on signature page)                                        N/A
---------------------------------------------------------------------------------------------------------------------------------
27                                 Financial Data Schedule (Filed herewith)
---------------------------------------------------------------------------------------------------------------------------------

<FN>
-----------------------------

(1)  Incorporated by reference to the Company's Form 10SB12G/A filed April 26, 1999.
(2)  Incorporated by reference to the Company's Form 10-SB12G, filed February 4, 1999.

</FN>
</TABLE>

                                       18
<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 to be signed on
its behalf by the undersigned thereunto duly authorized.

                                      ALFORD REFRIGERATED WAREHOUSE, INC.

                                      By:    /s/ James C. Williams
                                             -----------------------------------
                                                      James C. Williams
                                             President, Chief Financial Officer,
                                             Secretary, Treasurer and Director

April 14, 2000

                                       19
<PAGE>


                      POWER OF ATTORNEY TO SIGN AMENDMENTS

         KNOW ALL BY THESE  PRESENTS,  that each  person who  signature  appears
below does hereby  constitute  and appoint James C. Williams and Michael A. Oros
his true and lawful  attorney-in-fact  and agent for him and in his name,  place
and  stead,  in any and all  capacities,  to sign any or all  amendments  to the
Alford Refrigerated Warehouse,  Inc. Form 10-KSB, Annual Report, for year ending
December 31, 1999, and to file the same,  with all exhibits  thereto,  and other
documents in connection therewith,  with the Securities and Exchange Commission,
granting  unto said  attorney-in-fact  and agents full power and authority to do
and perform each and every act and thing  requisite  and necessary to be done in
and about the premises in order to effectuate the same as fully,  to all intents
and purposes,  as they or he might or could do in person,  hereby  ratifying and
confirming  that all  said  attorney-in-fact  and  agents,  or any of them,  may
lawfully do or cause to be done by virtue  hereof.  This Power of Attorney  been
signed  below  by the  following  persons  in the  capacities  and on the  dates
indicated.

         Pursuant to the  requirements  of the  Securities  and  Exchange Act of
1934,  this report has been signed below by the  indicated  persons on behalf of
the Registrant in the capacities and on the dates indicated.



      Signature                          Title                   Date
      ---------                          -----                   ----

/s/ Alton M. Adams              Chief Executive Officer    April 14, 2000
------------------------------
    Alton M. Adams

/s/ Michael A . Oros            President and Director     April 14, 2000
------------------------------
    Michael A .Oros

/s/ James C. Williams           Vice President, Chief      April 14, 2000
------------------------------  Financial Officer,
    James C. Williams           Secretary, Treasurer
                                and Director

/s/ Joseph Y. Robichaud         Director                   April 14, 2000
------------------------------
    Joseph Y. Robichaud

/s/ Kenneth M. Tomilson         Director                   April 14, 2000
------------------------------
    Kenneth M. Tomilson

                                Director                   April __, 2000
------------------------------
    John C. Crawford

                                Director                   April __, 2000
------------------------------
    Len Ebersberger



                                       20