LETTER TO OUR CUSTOMERS IN THE GREATER HOUSTON AREA CONCERNING HURRICANE IKE

September 18, 2008 

Dear Valued Clients & Friends,

First of all, I hope that all of you and your families made it through Hurricane Ike without any major damage to you personally or your personal property. Unfortunately, several of our team members have had significant damage from both the storm surge and falling trees. We are working to try and help all of our people get on their feet. It is going to take a while for some of them, but we will be there to help them along the way.

We feel lucky to have all of our management team up and running including all but one of our superintendents (who lost everything in the storm surge). We have not been so fortunate with our roofing and waterproofing mechanics as we have had only about 80% of our workforce report to work. I am, however, reasonably optimistic that as the electrical grid comes up that we will see most all of our team members back in action, but there is no way to know for sure at this time.

Here is some additional important information that I’d like to share with you as briefly as possible as it relates to our business: 

·    There is significant roof damage to a large number of buildings throughout the greater Houston area.

·    It is not yet possible to assess the damage done to various waterproofing systems on projects. It will not be as serious as the roofing/sheet metal damage, but there will clearly be some significant failures.

·    Chamberlin will be working 10 hours or more a day, six days a week to get our clients’ damaged properties temporarily dried-in before the next rain. This is our main focus.

·    Our secondary focus will be mobilizing our crews to the projects we have under contract as they come back on line.

·    We have made arrangements for all the necessary supplies to conduct business even though our office and warehouse facility is running on generators. The good news is our phone and email systems are all working. CenterPoint is projecting that most all of our zip code will have power by Monday, September 23rd… we are praying that will include us.

·    Prices for labor have already begun to escalate with contractors coming to town and setting up shop and soliciting workers from established companies (like Chamberlin) with offers of higher pay and payment in cash with no taxes withheld. This is obviously illegal, but the illegality will not stop it from happening. It is impossible to predict at this time where this will drive labor costs for roofing and sheet metal as well as waterproofing and caulking work.

·    We brought in 200 lunches this morning for our field operation team since there are few places open to eat lunch near the work sites. We will do so again on Friday and Saturday in hopes that come Monday the stores and restaurants have reached some type of near-normal operation. We will also be bringing in breakfast on Friday and Saturday since we observed so many of our men eating the lunch meal at our facility for breakfast because they could not wait to eat it for lunch.

·    We ask for your patience and support through what will clearly be some challenging times in the weeks and months ahead. If you need our help to do temporary repairs to your facility, contact our office and we will do our dead-level best to get you dried-in before the next rain.

Finally, please know that we are most grateful for the many projects that you have entrusted to the Chamberlin team over the last 31 years here in Houston. We will continue to work hard to earn your business in the future.

Sincerely,

John M. Kafka
 
General Partner