Plea Agreement

The United States of America and Alliance Mechanical, LLC ("the defendant"), a corporation organized and existing under the laws of Arizona, hereby enter into the following Plea Agreement pursuant to Rule 11(c)(1)(C) of the Federal Rules of Criminal Procedure ("Fed. R. Crim. P."):

RIGHTS OF DEFENDANT

1. The defendant understands its rights:

1. to be represented by an attorney;
2. to be charged by Indictment;
3. to plead not guilty to any criminal charge brought against it;
4. to have a trial by jury, at which it would be presumed not guilty of the charge and the United States would have to prove every essential element of the charged offense beyond a reasonable doubt for it to be found guilty;
5. to confront and cross-examine witnesses against it and to subpoena witnesses in its defense at trial;
6. to appeal its conviction if it is found guilty; and
7. to appeal the imposition of sentence against it.

2. The defendant knowingly and voluntarily waives the rights set out in Paragraph 1(c)-(f) above. The defendant also knowingly and voluntarily waives the right to file any appeal, any collateral attack, or any other writ or motion, including but not limited to an appeal under 18 U.S.C. § 3742, that challenges the sentence imposed by the Court if that sentence is consistent with the recommended sentence in Paragraph 8 of this Plea Agreement, regardless of how the sentence is determined by the Court. This agreement does not affect the rights or obligations of the United States as set forth in 18 U.S.C. § 3742(b)-(c). The defendant will plead guilty to the Indictment in this case, which charges it with participating in a conspiracy to suppress and eliminate competition by submitting rigged bids on contracts for the installation of commercial refrigeration in the Phoenix, Arizona metropolitan area beginning in or around January 2005 and continuing until May 16, 2005 in violation of the Sherman Antitrust Act, 15 U.S.C. § 1.

3. The defendant, pursuant to the terms of this Plea Agreement, will plead guilty to the criminal charge described in Paragraph 2 above and will make a factual admission of guilt to the Court in accordance with Fed. R. Crim. P. 11, as set forth in Paragraph 4 below.

4. Had this case gone to trial, the United States would have presented evidence sufficient to prove the following facts:

1. For purposes of this Plea Agreement, the "relevant period" is that period beginning in or around January 2005 and continuing until May 16, 2005. During the relevant period, the defendant was a company existing under the laws of the State of Arizona with its principal place of business in Phoenix, Arizona. During the relevant period, the defendant was an installer of commercial refrigeration and was engaged in the installation of commercial refrigeration in the Phoenix, Arizona metropolitan area and elsewhere. Commercial refrigeration includes the refrigerated cases in grocery stores such as deli, dairy and frozen food cases. During the relevant period, Kendall Pope was the president and co-owner of the defendant.
2. During the relevant period, the defendant, through Kendall Pope, participated in a conspiracy with an entity existing under the laws of the State of California, with its principal place of business in Anaheim, California ("Company A") through its regional manager, James Govostes. Company A was also engaged in the installation of commercial refrigeration, and the primary purpose of the conspiracy was to suppress and eliminate competition by submitting rigged bids on contracts for the installation of commercial refrigeration to Safeway Inc. ("Safeway") in the Phoenix, Arizona metropolitan area. In furtherance of the conspiracy, the defendant, through Kendall Pope, engaged in conversations with Company A, through James Govostes, during which they discussed the submission of bids for commercial refrigeration installation projects let by Safeway. During those conversations, the defendant, through Kendall Pope, and Company A, through James Govostes, agreed to do the following: 1) submit rigged bids for the installation of commercial refrigeration to Safeway in the Phoenix, Arizona metropolitan area; 2) raise margins on commercial refrigeration projects for Safeway; and 3) allocate bids for commercial refrigeration projects for Safeway among themselves based on which co-conspirator's company had a maintenance agreement in place at the particular Safeway store for which bids were let. The defendant, through Kendall Pope, and Company A, through James Govostes, also agreed upon who would submit the low bid for the commercial refrigeration project at Safeway Store #2088.
3. In accordance with the agreement, the defendant, through Kendall Pope, and Company A, through James Govostes, submitted rigged bids to Safeway for the commercial refrigeration project at Safeway Store #2088.
4. During the relevant period, substantial quantities of refrigeration fixtures, materials, and equipment, necessary for the defendant and Company A to perform commercial refrigeration installation projects in the Phoenix, Arizona metropolitan area, were transported across state lines in a continuous and uninterrupted flow of interstate commerce and in a manner substantially affecting interstate commerce. The business activities of the defendant and Company A related to the installation of commercial refrigeration affected by this conspiracy were within the flow of, and substantially affected, interstate trade and commerce.
5. During the relevant period, both the general business activities of the victim, Safeway Inc., which is headquartered in California, and the commercial refrigeration installation activities of the defendant, headquartered in Arizona, were conducted across state lines and had a not insubstantial effect on interstate commerce. Safeway does business throughout the United States.
6. Acts in furtherance of this conspiracy were carried out within the District of Arizona. The commercial refrigeration installation projects that were affected by this conspiracy were located in the Phoenix, Arizona metropolitan area.

5. The defendant understands that the statutory maximum penalty which may be imposed against it upon conviction for a violation of Section One of the Sherman Antitrust Act is a fine in an amount equal to the greatest of:

1. $100 million (15 U.S.C. § 1);
2. twice the gross pecuniary gain the conspirators derived from the crime (18 U.S.C. § 3571(c) and (d)); or
3. twice the gross pecuniary loss caused to the victims of the crime by the conspirators (18 U.S.C. § 3571(c) and (d)).

6. In addition, the defendant understands that:

1. pursuant to 18 U.S.C. § 3561(c)(1), the Court may impose a term of probation of at least one year, but not more than five years;
2. pursuant to §8B1.1 of the United States Sentencing Guidelines ("U.S.S.G.," "Sentencing Guidelines," or "Guidelines") or 18 U.S.C. § 3563(b)(2) or 3663(a)(3), the Court may order it to pay restitution to the victims of the offense; and
3. pursuant to 18 U.S.C. § 3013(a)(2)(B), the Court is required to order the defendant to pay a $400 special assessment upon conviction for the charged crime.

7. The defendant understands that the Sentencing Guidelines are advisory, not mandatory, but that the Court must consider the Guidelines in effect on the day of sentencing, along with the other factors set forth in 18 U.S.C. § 3553(a), in determining and imposing sentence. The defendant understands that the Guidelines determinations will be made by the Court by a preponderance of the evidence standard. The defendant understands that although the Court is not ultimately bound to impose a sentence within the applicable Guidelines range, its sentence must be reasonable based upon consideration of all relevant sentencing factors set forth in 18 U.S.C. § 3553(a).

8. Pursuant to Fed. R. Crim. P. 11(c)(1)(C), the United States and the defendant agree that they will jointly recommend, as the appropriate disposition of this case, that the Court impose a sentence within the applicable Guidelines range requiring the defendant to pay to the United States a criminal fine of $55,000, payable in full before the forty-fifth (45th) day after the date of judgment with interest accruing under 18 U.S.C. § 3612(f)(1)-(2) ("the recommended sentence"). The parties agree that there exists no aggravating or mitigating circumstance of a kind, or to a degree, not adequately taken into consideration by the U.S. Sentencing Commission in formulating the Sentencing Guidelines justifying a departure pursuant to U.S.S.G. §5K2.0. The parties agree not to seek or support any sentence other than the recommended sentence. The parties further agree that the recommended sentence set forth in this Plea Agreement is reasonable.

1. The defendant understands that the Court will order it to pay a $400 special assessment, pursuant to 18 U.S.C. § 3013(a)(2)(B), in addition to any fine imposed.

9. Subject to the ongoing, full, and truthful cooperation of the defendant described in Paragraph 11 of this Plea Agreement, and before sentencing in the case, the United States will fully advise the Court and the Probation Office of the fact, manner, and extent of the defendant's cooperation and its commitment to prospective cooperation with the United States' investigation and prosecutions, all material facts relating to the defendant's involvement in the charged offense, and all other relevant conduct.

10. The United States and the defendant understand that the Court retains complete discretion to accept or reject the recommended sentence provided for in Paragraph 8 of this Plea Agreement.

1. If the Court does not accept the recommended sentence, the United States and the defendant agree that this Plea Agreement, except for Paragraph 10(b) below, shall be rendered void.
2. If the Court does not accept the recommended sentence, the defendant will be free to withdraw its guilty plea (Fed. R. Crim. P. 11(c)(5) and (d)). If the defendant withdraws its plea of guilty, this Plea Agreement, the guilty plea, and any statement made in the course of any proceedings under Fed. R. Crim. P. 11 regarding the guilty plea or this Plea Agreement or made in the course of plea discussions with an attorney for the government shall not be admissible against the defendant in any criminal or civil proceeding, except as otherwise provided in Fed. R. Evid. 410. In addition, the defendant agrees that, if it withdraws its guilty plea pursuant to this subparagraph of the Plea Agreement, the statute of limitations period for any offense referred to in Paragraph 16 of this Plea Agreement will be tolled for the period between the date of the signing of the Plea Agreement and the date the defendant withdrew its guilty plea or for a period of sixty (60) days after the date of the signing of the Plea Agreement, whichever period is greater.

11. The defendant will cooperate fully and truthfully with the United States in the prosecution of this case, the conduct of the current federal investigation of violations of federal antitrust and related criminal laws involving the installation of commercial refrigeration in the Phoenix, Arizona metropolitan area, any other federal investigation resulting therefrom, and any litigation or other proceedings arising or resulting from any such investigation to which the United States is a party ("Federal Proceeding"). The ongoing, full, and truthful cooperation of the defendant shall include, but not be limited to:

1. producing to the United States all non-privileged documents, information, and other materials wherever located, in the possession, custody, or control of the defendant, requested by the United States in connection with any Federal Proceeding;
2. using its best efforts to secure the ongoing, full, and truthful cooperation, as defined in Paragraph 12 of this Plea Agreement, of the current directors, officers, and employees of the defendant as may be requested by the United States, including making these persons available, at the defendant's expense, for interviews and the provision of testimony in grand jury, trial, and other judicial proceedings in connection with any Federal Proceeding.

12. The ongoing, full, and truthful cooperation of each person described in Paragraph 11(b) above will be subject to the procedures and protections of this Paragraph, and shall include, but not be limited to:

1. producing all non-privileged documents, including claimed personal documents, and other materials, wherever located, requested by attorneys and agents of the United States;
2. making himself or herself available for interviews, not at the expense of the United States, upon the request of attorneys and agents of the United States;
3. responding fully and truthfully to all inquiries of the United States in connection with any Federal Proceeding, without falsely implicating any person or intentionally withholding any information, subject to the penalties of making false statements (18 U.S.C. § 1001) and obstruction of justice (18 U.S.C. § 1503, et seq.);
4. otherwise voluntarily providing the United States with any non-privileged material or information not requested in (a) - (c) of this paragraph that he or she may have that is related to any Federal Proceeding;
5. when called upon to do so by the United States in connection with any Federal Proceeding, testifying in grand jury, trial, and other judicial proceedings fully, truthfully, and under oath, subject to the penalties of perjury (18 U.S.C. § 1621), making false statements or declarations in grand jury or court proceedings (18 U.S.C. § 1623), contempt (18 U.S.C. §§ 401-402), and obstruction of justice (18 U.S.C. § 1503, et seq.); and
6. agreeing that, if the agreement not to prosecute him or her in this Plea Agreement is rendered void under Paragraph 14(c), the statute of limitations period for any Relevant Offense as defined in Paragraph 14(a) will be tolled as to him or her for the period between the date of the signing of this Plea Agreement and six (6) months after the date that the United States gave notice of its intent to void its obligations to that person under the Plea Agreement.

GOVERNMENT'S AGREEMENT

13. Upon acceptance of the guilty plea called for by this Plea Agreement and the imposition of the recommended sentence, and subject to the cooperation requirements of Paragraph 11 of this Plea Agreement, the United States agrees that it will not bring further criminal charges against the defendant for any act or offense committed before the date of this Plea Agreement that was undertaken in furtherance of an antitrust conspiracy involving the installation of commercial refrigeration in the Phoenix, Arizona metropolitan area. The nonprosecution terms of this paragraph do not apply to civil matters of any kind, to any violation of the federal tax or securities laws, or to any crime of violence.

14. The United States agrees to the following:

1. Upon the Court's acceptance of the guilty plea called for by this Plea Agreement and the imposition of the recommended sentence and subject to the exceptions noted in Paragraph 14(c), the United States will not bring criminal charges against any current director, officer, or employee of the defendant for any act or offense committed before the date of this Plea Agreement and while that person was acting as a director, officer, or employee of the defendant that was undertaken in furtherance of an antitrust conspiracy involving the installation of commercial refrigeration in the Phoenix, Arizona metropolitan area ("Relevant Offense") except that the protections granted in this paragraph shall not apply to Kendall Pope;
2. Should the United States determine that any current or former director, officer, or employee of the defendant may have information relevant to any Federal Proceeding, the United States may request that person's cooperation under the terms of this Plea Agreement by written request delivered to counsel for the individual (with a copy to the undersigned counsel for the defendant) or, if the individual is not known by the United States to be represented, to the undersigned counsel for the defendant;
3. If any person requested to provide cooperation under Paragraph 11(b) fails to comply with his or her obligations under Paragraph 12, then the terms of this Plea Agreement as they pertain to that person, and the agreement not to prosecute that person granted in this Plea Agreement, shall be rendered void;
4. Except as provided in Paragraph 14(e), information provided by a person described in Paragraph 11(b) to the United States under the terms of this Plea Agreement pertaining to any Relevant Offense, or any information directly or indirectly derived from that information, may not be used against that person in a criminal case, except in a prosecution for perjury (18 U.S.C. § 1621), making a false statement or declaration (18 U.S.C. §§ 1001, 1623), or obstruction of justice (18 U.S.C. § 1503, et seq.);
5. If any person who provides information to the United States under this Plea Agreement fails to comply fully with his or her obligations under Paragraph 12 of this Plea Agreement, the agreement in Paragraph 14(d) not to use that information or any information directly or indirectly derived from it against that person in a criminal case shall be rendered void;
6. The nonprosecution terms of this paragraph do not apply to civil matters of any kind, to any violation of the federal tax or securities laws, or to any crime of violence; and
7. Documents provided under Paragraphs 11(a) and 12(a) shall be deemed responsive to outstanding grand jury subpoenas issued to the defendant.

15. The defendant has been represented by counsel and is fully satisfied that its attorneys have provided competent legal representation. The defendant has thoroughly reviewed this Plea Agreement and acknowledges that counsel has advised it of the nature of the charge, any possible defenses to the charge, and the nature and range of possible sentences.

16. The defendant's decision to enter into this Plea Agreement and to tender a plea of guilty is freely and voluntarily made and is not the result of force, threats, assurances, promises, or representations other than the representations contained in this Plea Agreement. The United States has made no promises or representations to the defendant as to whether the Court will accept or reject the recommendations contained within this Plea Agreement.

17. The defendant agrees that, should the United States determine in good faith, during the period that any Federal Proceeding is pending, that the defendant has failed to provide full and truthful cooperation, as described in Paragraph 12 of this Plea Agreement, or has otherwise violated any provision of this Plea Agreement, the United States will notify counsel for the defendant in writing by personal or overnight delivery or facsimile transmission and may also notify counsel by telephone of its intention to void any of its obligations under this Plea Agreement (except its obligations under this paragraph), and the defendant shall be subject to prosecution for any federal crime of which the United States has knowledge including, but not limited to, the substantive offenses relating to the investigation resulting in this Plea Agreement. The defendant may seek Court review of any determination made by the United States under this Paragraph to void any of its obligations under the Plea Agreement. The defendant agrees that, in the event that the United States is released from its obligations under this Plea Agreement and brings criminal charges against the defendant for any offense referred to in Paragraph 14 of this Plea Agreement, the statute of limitations period for such offense will be tolled for the period between the date of the signing of this Plea Agreement and six (6) months after the date the United States gave notice of its intent to void its obligations under this Plea Agreement.

18. The defendant understands and agrees that in any further prosecution of it resulting from the release of the United States from its obligations under this Plea Agreement, because of the defendant's violation of the Plea Agreement, any documents, statements, information, testimony, or evidence provided by it or its current directors, officers, or employees of it to attorneys or agents of the United States, federal grand juries, or courts, and any leads derived therefrom, may be used against it in any such further prosecution. In addition, the defendant unconditionally waives its right to challenge the use of such evidence in any such further prosecution, notwithstanding the protections of Fed. R. Evid. 410.

19. This Plea Agreement constitutes the entire agreement between the United States and the defendant concerning the disposition of the criminal charge in this case. This Plea Agreement cannot be modified except in writing, signed by the United States and the defendant.

20. The undersigned is authorized to enter this Plea Agreement on behalf of the defendant as evidenced by the Resolution of the Board of Directors of the defendant attached to, and incorporated by reference in, this Plea Agreement.

21. The undersigned attorneys for the United States have been authorized by the Attorney General of the United States to enter this Plea Agreement on behalf of the United States.

DEFENDANT'S APPROVAL AND ACCEPTANCE

22. As the duly authorized representative of the defendant, I have read each of the provisions of the entire plea agreement with the assistance of counsel, and understand its provisions.

23. I have discussed the case, the defendant's constitutional rights, and other rights with the defendant's attorney. I understand that by entering my plea of guilty the defendant will be giving up its rights to plead not guilty, to trial by jury, to confront, cross-examine, and compel the attendance of witnesses, to present evidence in its defense -- all with the assistance of counsel -- and to be presumed innocent until proven guilty beyond a reasonable doubt.

24. The defendant agrees to enter its guilty plea as indicated above on the terms and conditions set forth in this agreement.

25. I have been advised by the defendant's attorney of the nature of the charges to which the defendant is entering its guilty plea. I have further been advised by the defendant's attorney of the nature and range of the possible sentence and that the defendant's ultimate sentence will be determined according to the guidelines promulgated pursuant to the Sentencing Reform Act of 1984. I further understand that, under certain limited circumstances, the court may depart upward or downward from the calculated guideline range.

26. The defendant's guilty plea is not the result of force, threats, assurances or promises other than the promises contained in this agreement. The defendant agrees to the provisions of this agreement as a voluntary act on its part rather than at the direction of or because of the recommendation of any other person. The defendant further agrees to be bound by this agreement's provisions.

27. I agree that this written plea agreement contains all the terms and conditions of the defendant's plea and that promises made by anyone (including the defendant's attorney), and specifically any predictions as to the guideline range applicable, that are not contained within this written plea agreement are without force and effect and are null and void.

28. I am satisfied that the defendant's attorney has represented the defendant in a competent manner.

29. I am fully capable of understanding the terms and conditions of this plea agreement. I am not now on or under the influence of any drug, medication, liquor, or other intoxicant or depressant, which could impair my ability to fully understand the terms and conditions of this plea agreement.

DEFENSE ATTORNEY'S APPROVAL

30. I have discussed this case and the plea agreement with my client, in detail and have advised the defendant of all matters within the scope of Fed. R. Crim. P. 11, the constitutional and other rights of an accused, the factual basis for and the nature of the offense to which the guilty plea will be entered, possible defenses, and the consequences of the guilty plea including the maximum statutory sentence possible. I have further discussed the sentencing guideline concept with the defendant. No assurances, promises, or representations have been given to me or to the defendant by the United States or by any of its representatives which are not contained in this written agreement. I concur in the entry of the plea as indicated above and on the terms and conditions set forth in this agreement as in the best interests of my client. I agree to make a bona fide effort to ensure that the guilty plea is entered in accordance with all the requirements of Fed. R. Crim. P. 11.

31. I have reviewed Alliance Mechanical, LLC's matter and this plea agreement. I agree on behalf of the United States that the terms and conditions set forth are appropriate and are in the best interests of justice.