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					                  INVITATION FOR BID NUMBER AEPA IFB #007-G

     WEB-BASED ONLINE AUCTION SERVICE FOR DISPOSITION OF SURPLUS
                             PROPERTY

                                       PART B –SPECIFICATIONS


4. Special Terms & Conditions
The following special terms and conditions are in addition to the applicable general
terms and conditions that appear in part A. Please review them and complete the
Exceptions to Terms, Conditions and Specifications Form in Part C, Bid Forms.


4.1 Bidder must demonstrate through its response that it has provided, can provide, and
can support a comprehensive solution that will meet or exceed the scope of work and
specifications.


Development of Our 24/7 Online Auction Program


Lone Star Auctioneers has specialized in the sale at auction of government surplus, seized
and unclaimed property since 1985. In that time, we have sold over a quarter billion
dollars for government agencies at all levels.


We began evaluating the technology and feasibility of online auction services for
governmental entities almost from the creation of our website in March 1997. Initially we
used the website and Internet as a tool to develop the markets for our existing “live on-site
auction” clients. At that time, governments solicitations, generally, were not structurally
prepared for the advent of 24/7 auctions for the disposition of their surplus and confiscated
assets. Nor was the general market for government assets technically or psychologically
ready. Over time, government procurement practices changed to incorporate the Internet
while the public became more aware of Internet auctions through the eBay phenomenon.
We continued our research and utilization of various online software packages, conducting
our first “online” auction in November 1999. Since that time, Lone Star Auctioneers has
developed a significant online presence in marketing surplus, seized and confiscated
government assets online.


The fact that most of our contracts for government agencies, typically, were for five years
complicated our implementation of online auctions in the 24/7 format. The contracts did
not provide the opportunity for those clients to utilize Internet auctions.
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Beginning in February 2002, we began Webcasting (Live, on-site auctions with Internet
Bidders participating in real time against live, floor bidders.) seized jewelry auctions under
our new national contract with The U.S. Marshal’s Service. In ten auctions in three years
Lone Star sold over $11,000,000 in seized valuables. Twenty five percent or $2,678,000 of
that sold to online bidders.


In July 2003 The City of Fort Worth approached us with a request to conduct a pilot 24/7
online auction program for their fleet surplus. Having done our research over the prior
three years, we were prepared to launch their pilot program immediately.


Lone Star had registered the domain name LoneStarOnline.com in the late 1990’s in
preparation for this moment. We launched it as a dedicated domain with a state-of-the-art
custom program.


We believe Lone Star Auctioneers is uniquely qualified to provide AEPA the best value and
highest net return on investment through Internet sales based on:

1)     Lone Star Auctioneers currently operates what has surely become the most successful
       online auctions of forfeited and unclaimed property in the U.S.

2)     Lone Star’s high website traffic is currently averages twenty over (20) million hits per
       month and is rapidly growing (On August 29-31, 2006, LoneStarOnline.com, received
       over 1,000,000 hits per day). One September 1, 2006, it rose to 1,236,216 hits for the
       day. September had 24,000,000 hits for the month.

3)     Almost 6,000 other affinity Internet sites link to our sites as measured by an
       independent link evaluation service. That is more than our three largest online
       competitors combined;

4)     The success we are achieving under the current storage and online contract for the
       U.S. Marshals Service is amazing.                    We had USMS property posted on
       LoneStarOnline.com with only two weeks notice and little or no time for advertising
       and promotion. We have continued to post new USMS district auctions and the
       response and results have been excellent. National trade advertising takes much
       longer lead times (months instead of days) and yet the strength of our site and solid


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       buyer base has made the USMS online auctions an instant success. We closed over
       $900,000 in sales for them in a single day!;

5)     The success achieved for our clients on a regular basis for unclaimed safe deposit box
       contents, surplus vehicles, heavy equipment, and FF&E is another testament to why
       we should be awarded the contract. Recently, we sold an unclaimed Mickey Mantle
       baseball card for the State of California for $11,300! It was appraised at $7,000. City
       and state surplus is also bringing record prices in our online auctions;

6)     The quality of our 24/7 and Webcast online auction clients including the State of
       Texas, the State of California and numerous cities and counties, draws traffic to our
       site through links from their respective sites;

7)     The volume of goods we post for our regular online clients on our site;

8)     The dedication Lone Star makes to state of the art technology in hardware and
       software;

9)     The quality and availability of the client, customer and technical support we provide;
       and

10) The size of our full-time staff who are dedicated to training, supporting and running
       our online auctions including a Project Manager for Online Auctions, a Website
       Administrator, an Online Auction Administrator and an Accounting Administrator of
       Online Auctions.


The best demonstration of our understanding of the requirement to provide online auction
services would be for you to visit our 24/7 auction site, LoneStarOnline.com. There you
will find our very active and user-friendly Internet-only online auctions. You can also
enter through our home page at www.LoneStarAuctioneers.com. This entry provides one
with access to our live auctions, live/webcast and 24/7 online only auctions.


Since our first 24/7 online auction for the City of Fort Worth, Texas, in August 2003, we
have sold $10 million dollars and over 15,000 lots through our web-based, online property
auction service. We have four clients who have surpassed $4.45 million in combined sales.
Our site emulates eBay in feel and function and requires an almost zero learning curve for
users familiar with eBay. We provide unlimited technical support to our clients and

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customer support to our buyers and the public. Our site is intuitive for clients to learn and
use. Training and familiarization can be completed in a matter of a few hours. Because
our site is so easy for the public to use, we get relatively few requests for assistance
considering the volume of traffic our site receives.


Lone Star Auctioneers comes in first out of 178,000 results when the term “forfeited
jewelry auctions” is Googled, (www.usmarshals.gov places 7th.) When searching “forfeited
jewelry,” usdoj.gov is number one with LoneStarOnline.com coming in 2nd, 4th, 6th,8th, 9th,
10th, 11th and so on as a result of our current national advertising campaign for these
USMS online jewelry assets. Further searches yield high placement results as well: “with
jewelry auctioneers,” Lone Star is 17th among 818,000 results and “jewelry auctions” finds
us 44th out of 178,000,000 results.


Search results for “forfeited jewelry auctions” on Yahoo place Lone Star in 1 st, 2nd and
10th. “Forfeited jewelry” has usdoj.gov in the first two positions with us in number three.


Searching Google and Yahoo for “fleet surplus” on January 27, 2006, LoneStarOnline
came up in the 1st position on Google and 4th on Yahoo just behind Utah, Oregon and OKC.
When we Googled “24/7 online auctions” that day, we came up ranked second. A search
for “Auto pound auctions” on Google brought us up in the 1st position and links to our
Dallas and Irving auctions in 2nd and 4th positions. Yahoo yielded 1st, 2nd and 3rd positions
for the same search phrase. This is a sampling of where we appear in pertinent Internet
searches.


Lone Star Auctioneers will continue its efforts to remain at the top of the search engines
and to drive our positions even higher.


Lone Star aggressively works to develop active markets for the specific geographic areas of
our new clients and for items or classes of items of particular value and/or nature.


In addition to the USMS, our current and recent client list of 24/7 online auctions includes
the U.S. Postal Inspection Service, the State of California and the State of Texas including
the Department of Transportation, Department of Public Safety, Departments of Criminal
Justice, Aging and Disability, Parks and Wildlife, several state hospitals and schools, Cities
of Fort Worth, Dallas, Lewisville, Brownsville, Waco and numerous cities in Florida, Dallas
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County, independent school districts, the Dallas Zoo, Tarrant Regional Water District,
Dallas Area Rapid Transit Authority, police and sheriff’s departments and others.


Lone Star currently has 25,000 bidders registered on our websites and another 25,000 in
our direct mail database. The rate of bidder registration continues to increase as our
marketing and promotion efforts reach greater market sectors.                    Our geographic
distribution continues to gain breadth and density.


4.2 Bidder must demonstrate it possesses the necessary resources to provide a
comprehensive implementation, training and support program on the operation and use
of the solution offered to both sellers and buyers. The services offered must be
appropriate and adequate to ensure a successful surplus disposal program.


Financial Resources


Lone Star Auctioneers is a very stable, financially sound provider of live, webcast and 24/7
online auctions. We do not borrow money, we pay our accounts in full every two weeks
and we pay our live auction clients in full by cashiers check no later than the second bank
day after each auction unless otherwise instructed by the client. For the webcast portion of
live auctions, we pay our clients by cashiers check no later than the second bank day after
the webcast payment deadline. For 24/7 auctions, we pay most of our clients by cashiers
check no later than the second bank day after the posted payment deadline. To simplify
the accounting and reporting for so many Participating Agency Members anticipated
under this contract, we propose to pay admin fees and auction proceeds to Member
Agencies and Participating Agency Members by company check monthly within five (5)
banking days after the close of the month.


Please see the Credit Information Letter from the Senior Vice President with Wells Fargo
Bank to substantiate our liquidity and banking relationship.


Technological Resources


         Software


         Lone Star Auctioneers uses a proprietary, custom-designed software program that
         is state-of-the-art. It emulates eBay almost identically in function but has a unique,

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         Lone Star interface. It is virtually infinitely expandable for almost limitless user
         access. There is virtually no learning curve for buyers experienced with eBay.


         Lone Star owns our custom 24/7 online software, and our personnel are highly
         proficient in the administration and operation of our online auction program.


         Our 24/7 software is written in Cold Fusion using a SQL database for virtually
         unlimited access and scalability. Our software is proven to be completely functional
         and stable. When we purchased the package, we had the designers write custom
         functions for us to meet our needs in performing 24/7online auctions for government
         entities. Then our IT/Web Administrator customized the look and feel of our online
         package to give is a unique package that was consistent with our home page and
         distinguished us from other online auctions.


         Next, we had our contract software designer, with whom we have worked for years
         on other custom software, design an accounting and reporting package that
         interfaces with the auction software emulating our live auction software reports.
         This accounting package accounts for and reports the activity from each group of
         auctions in complete detail.            After each auction, we provide our clients with
         comprehensive, concise and reconciled reports by individual auction (lot), buyer,
         payment, seller department or fund and other criteria. These reports provide a
         complete audit trail for all items offered in our online auctions.


         The designers of our basic auction package offer periodic upgrades. We are quite
         satisfied with the system as it now works, but in the future, should we decide it
         would be advantageous to upgrade our auction software, we would do so at no cost
         to AEPA.          The designers are very careful to test any changes, upgrades and
         customizations to the software.           They test it extensively in simulated real-time
         auctions.


         We had certain features customized for us after the initial design upgrades and
         modifications. Our software designers are very responsive to our projects and have
         provided a finished, thoroughly tested product on a timely basis. Any custom
         software design we initiate will be at our expense.             Any changes or custom


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         programming required by AEPA will be at AEPA expense as detailed in the pricing
         section.


         Our software designers host our online server, provide 24/7 technical monitoring
         and support and provide our customizations and periodic upgrades. Lone Star
         owns all our server hardware and software. One January 30, 2006, we installed a
         new, state-of-the-art server with multiple redundancy. Included was an external
         320 Gig hard drive exclusively for the nightly and weekly data and program
         backups.


         Hardware


         We run LoneStarOnline.com auctions on a Lone Star-owned, dedicated server with
         two dual core 2.8 GHz Xeon processors (total processing speed approaches 5 GHz)
         with six “hot-swappable” 15,000 rpm, 73 Gigabyte SCSI hard drives in a RAID 5
         configuration with twin “hot-swappable” power supplies, multiple “hot-swappable”
         cooling fans and other redundant features.


         We backup nightly to a Lone Star-owned, dedicated external hard drive with 320
         Gigabytes of memory with special software to back up data files daily and program
         files weekly. We provide multiple T-1 broadband lines for Internet access to the
         server, 24/7 technical support for the server by the program developers, 24/7 four-
         hour on-site response for parts and labor support for the server from the
         manufacturer (Dell) and we will provide free periodic seamless software and
         hardware upgrades for the duration of this contract without interruption of service.


         Bandwidth


         Lone Star Auctioneers has three and one-half (3 ½) bonded T-1 lines with bursting
         dedicated to provide high bandwidth to run LoneStarOnline.com. This bonded T-1
         provides over three Gig of bandwidth and the “bursting” capability means that if
         our bandwidth requirements exceed the three gigs basically unlimited additional
         bandwidth is available seamlessly as needed. Three gigs is a very high level of
         bandwidth. Bandwidth is a primary limiting factor of site speed. Before we moved
         to the dedicated T-1 lines, we were sharing two T-1 lines with other sites. Our site is
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         rated “very fast,” faster than 82% of the sites on the Internet. Now that we have
         this dedicated capacity, our site should move into the high 90 percentile.


         Mail Server
         Lone Star Auctioneers has its own dedicated email server software on a company-
         owned, state-of-the-art server. This is to eliminate our dependence on commercial
         email servers which are periodically out of service. If there is a problem with our
         email server and software, we can immediately switch to a provider to maintain
         continuity of the automatic emails generated by our online auction software.


Personnel Resources


Lone Star Auctioneers has the personnel to conduct the services required under this
contract. We have the ability to ramp up our personnel and facilities according to the
demands of this contract. We have sufficient capacity to a manage a significant number of
new clients from AEPA. Our corporate facilities can accommodate any additional staff
required to meet the growing needs of AEPA. The following are key personnel who will be
integrally involved in performance:

         Marilyn K. Burgess, President/C.E.O., is hereby designated the Point of Contact for
         this contract. She has ultimate responsibility for contractual, policy and operational
         decisions.


         Ed Lanford, Jr., Vice President/C.O.O., is hereby designated Security Officer and
         Technical Contact.             Mr. Lanford has held multiple Secret clearances with the
         Department of Defense and a Top Secret clearance with the Atomic Energy
         Commission. As Security Officer for Radiation Research Associates, Inc., he won a
         national security award for his design and implementation of a classification,
         storage and reporting system for highly classified data for contracts with the
         Department of Defense and Atomic Energy Commission.


         Anne Dalton, National Contracts Manager, is hereby designated the Project
         Coordinator. Dalton has successfully managed numerous contracts for the federal
         and state governments involving transportation, appraisal, storage, and sale at
         auction of seized and unclaimed valuable personal property in online, live and

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         webcast formats. The managed assets have totaled between $75 and $100 million
         dollars.


         These Points of Contact can be reached at:
         Lone Star Auctioneers Building
         4629 Mark IV Parkway
         Fort Worth, TX 76109-2213
         817.740.9400 Phone
         817.740.9777 Fax


         Cell Phone:                                        Email:
         817.994.0999 Cell (Burgess)                        Marilyn@LoneStarAuctioneers.com
         817.994.0998 Cell (Lanford)                        EdLanford@LoneStarAuctioneers.com
         817.845.9213 Cell (Dalton)                         Anne@LoneStarAuctioneers.com


         Paula Hooper
         Office Manager/Project Administrator for Online Auctions, Fleet Surplus Contracts
         and Federal Vehicle Services Contracts/Auctioneer
         TX Auctioneers Lic. No. 12299


         Paula Hooper is Office Manager/Administrator for multiple city contracts and is
         Project Manager for our federal Vehicle Services contracts. She attended the Gregg
         School of Auctioneering in December 1985 and has been licensed as an auctioneer
         since that time. Hooper is a vital long-term member of Lone Star’s staff whose
         experience and expertise are exhibited in many aspects of the company’s business
         transactions. She works directly with clients for Online sales. In this capacity
         Hooper promotes Lone Star’s services to potential clients and assists in the
         transition from live auction procedures to Internet auction procedures and
         requirements. Ms. Hooper has experience in accounting and banking. She is one of
         Lone Star’s primary on site computer operators and plays a vital part in all our
         Webcast and Online auctions. She has completed numerous hours of course work at
         Tarrant County College. Her project management skills and computer proficiency
         are exceptional.




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         Paul Wibbeler
         Business Development/Auctioneer
         TX Auctioneers Lic. No. 13922


         Auctioneer Paul Wibbeler began working for Lone Star Auctioneers in November
         2005 and joined the team full-time on January 1, 2006. Mr. Wibbeler brings with
         him valuable auction experience and a love for the auction industry. That interest
         compelled him to attend auction school twice: first graduating from the Nashville
         Auction School in Tullahoma, Tennessee and then from Texas Auction Academy in
         Dallas, Texas. Wibbeler has been involved in almost every aspect of the auction
         industry and is now bringing his energy and enthusiasm to the Lone Star Team.
         After 3 years of active duty in the US Army with an Honorable Discharge and after
         24 years in the sign industry, he realized his dream of becoming a professional
         auctioneer. He has been working as one ever since. With skills in writing and
         vocabulary, a love of people and the auction industry, and endowed with dedication
         and purpose.


         Pam Kennedy
         Accounting Manager


         Ms. Kennedy has extensive background in bookkeeping, data entry, and all aspects
         of office procedure. Kennedy spent many years as an office manager and has
         experience in writing and submitting bid responses. She also has experience in the
         banking business. Pam has been instrumental in the refinement and use of Lone
         Star’s online auction software and is responsible for overseeing the closing,
         invoicing and collection of all online auctions. She also oversees the distribution of
         funds to our consignors and keeps accurate and current records of each auction. She
         also operates a computer at our Webcast auctions, assisting Live-Internet bidders
         via the computer during a live auction.




         Karen Plunk
         Advertising/Promotion Specialist


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         Karen Plunk is responsible for all of Lone Star’s advertising and promotion on a
         local, state, national and international level. Karen draws on over ten (10) years of
         experience in newspaper and print advertising and in the printing industry. She also
         does a significant portion of our digital photography and image manipulation.
         Having pursued an Associates Degree in Graphic Arts at Tarrant County College
         and having worked in the printing industry, she is conversant with all aspects of
         advertising and publication layout, design, and production.


         Kathi Clark
         IT Manager/Website & Online Auction Administrator/Internet Marketing


         Ms. Clark is responsible for web page design and maintenance for all of our
         websites at www.LoneStarAuctioneers.com, and www.LoneStarOnline.com. She is
         an experienced Web/Network Administrator who brings not only ten years of
         knowledge and skill to the job, but also organization, reliability, and punctuality.
         With Clark on staff, Lone Star's website is more accessible and active than ever
         before. In addition, our website has more visits each month than at any other time
         in our history. Graduating with a double major, a B.A. in Communication with an
         emphasis in Advertising, as well as a B.F.A. in graphic design and photography
         from the University of Texas at Arlington, She is also responsible for compiling and
         manipulating the digital images for the video tape, CD and the digital image
         presentation which are used during live auctions.


         Candy Gillespie
         Online Accounting Administrator


         Candy Gillespie is responsible for administering our City of Dallas, and City of Fort
         Worth Auto Pound contracts. She manages all aspects of the contracts under which
         we sell abandoned and impounded vehicles. She completes and mails all auction
         sales receipts, titles, applications for title and is our primary contact for issuance of
         all vehicle paper work. Ms. Gillespie is our title clerk who performs all aspects of
         the filing of certifications, titles, applications for title and government form 97 for
         multiple contracts including State of Texas, City of Irving, US Marshal Service
         Vehicle Services contracts.


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         Marci Caldwell
         Administrative Assistant/Federal Jewelry Contracts and State Unclaimed Property
         Contracts


         Marci Caldwell assists our Project Administrators Paula Hooper and Anne Dalton
         in the day-to-day activities of all auction contracts. She has proven herself to be a
         dedicated, reliable and apt employee. At live auctions, Caldwell performs multiple
         functions in the auction office. She is currently enrolled at Tarrant County College.


         Willa Lister
         Onsite Auctions Office Manager/Asset Shipping Manager


         B.A.-Dillard University, New Orleans, LA; M.Ed. North Texas State University;
         Denton, Texas; Doctoral Student, Kennedy-Western University, Wyoming; Licensed
         Professional Counselor, State of Texas. Ms. Lister has been employed part time with
         Lone Star Auctioneers since 1984. At live auctions she writes clerk sheets, performs
         bid spotting and at major auctions, she is responsible for managing the registration
         and payout activities and responding to any issues that may arise related to our
         customers. Her primary Corporate Office responsibilities include packing and
         shipping assets from online and live auctions. Ms. Lister is a former educator and
         was a municipal administrator for more than 30 years, having been responsible for
         General and Federal Funds with budgets exceeding 8 million dollars. Lister serves
         as a volunteer with a number of non-profit City and County organizations.


         Elsa Valenzuela Edwards
         Administrator/City of Dallas and City of Fort Worth Auto Pound/Online
         Accounting Support


         Elsa Edwards assists with the administration of Online auctions. She formerly
         worked as the Project Administrator for Lone Star’s City of Dallas and City of Fort
         Worth Police Auto Pound contracts and brings a great deal of auction experience to
         the process of conducting our Online auctions. She provides back up to computer
         operators at live auctions. Ms. Edwards is bilingual (oral & written) and she
         formerly worked for a major corporation in Mexico where she was in charge of
         payroll for approximately 400+ employees.
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         Eugene Thompson
         Set up, Security, Equipment & Computer Network Specialist


         Gene Thompson has recently brought his experience to Lone Star Auctioneers after
         amassing expertise in technical, operations, administrative and supervisory
         positions as well as extensive PC networking and diagnostic skills. His experience
         extends into the auction industry from having held various positions for a Salvation
         Army location which held weekly auctions. Thompson was responsible for
         organization and oversight of those auctions in addition to other duties. Thompson
         is responsible for auction set up and security. In the Corporate Office, he will use his
         knowledge and expertise in computer technology for Network administration and
         hardware and software operations. His educational background includes an
         Associates Degree in Applied Science from The Community College of the Air Force
         and completion of a majority of course-work toward a B.B.A. degree, University of
         North Texas. He is A+ Certified and is retired from the U.S. Air Force.


         Sheri Buse
         Online Accounting Administrator


         Sheri Buse brings twelve (12) years experience as a legal secretary and seventeen
         (17) years as a full charge bookkeeper to this position. Her experience includes
         engagements with two law offices, a consumer credit company, a real estate
         management firm and a regional industrial supply company. Buse was educated at
         McMurry University and Tarleton State University and is a member of the National
         Honor Society. She is well-versed and skilled in a wide range of office productivity
         and accounting software.


         Chanse Awtrey
         Equipment and Facility Manager


         Chanse Awtrey is responsible for the care, storage, maintenance and set-up of all
         our equipment including vehicles, trailers, public address, electronic, and technical
         equipment. He performs Vehicle Services for a number of contracts. Mr. Awtrey is
         a lead set-up supervisor and make-ready person for live/webcast auctions. He also
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         works as a bid spotter at live auctions. He also offers great assistance to our IT
         manager with our online software and imaging.


         Dave Dillingham
         Pound Vehicle Specialist, Set-up/Security


         Dillingham is responsible for preparing all pound vehicles for sale at auction. He
         unlocks them, scrapes inspection stickers off and places Buyers Guides in the
         windows. His other duties include setting up auctions and providing security of the
         merchandise and check-out.


         Demetria Wallen
         Receptionist/Administrative Assistant


         Lone Star Auctioneers’ permanent live/webcast auction staff consists of full and
         part-time, cross-trained members of the company. The following lists provides their
         names, auction experience (year licensed or began working auctions) and general
         auction duties:


           LIVE/WEBCAST                          SINCE          AUCTION DUTIES
           STAFF

           Marilyn Burgess                       1984           Auctioneer
           Ed Lanford                            1982           Auctioneer
           Bill Burgess                          1957           Auctioneer
           Wayne Rhodes                          1975           Auctioneer/Ring
           Miles Autry                           1972           Auctioneer/Ring
           Betty Burgess                         1981           Office Manager
           Willa Lister                          1984           Office Manager
           Paula Hooper                          1984           Computer      Operator/Webcast            computer
                                                                operator
           Anne Dalton                           1990           Project Manager/Office
           Pam Kennedy                           1995           Cashier/Computer/Webcast                  computer
                                                                operator
           Leah McClure                          2004           Administrative/Clerical
           Karen Plunk                           1997           Registrar/ Head Cashier
           Paul Wibbeler                         2005           Auctioneer/Sales/Administration
           Marci Caldwell                        2003           Registrar/Cashier/Computer
           Kathi Clark                           2004           IT/Webcast        support/Digital             image
                                                                presentations
           Candy Gillespie                       2005           Registrar/Office
           Chanse Awtrey                         2005           Registrar/Office/Bidspotter

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           LIVE/WEBCAST                          SINCE          AUCTION DUTIES
           STAFF
           Elsa Edwards                          1996           Cashier/ Registrar/Office
           Gene Thompson                         1990           Registrar/Office
           Sheri Buse                            2006           Cashier/ Registrar/Office
           Demetria Wallen                       2005           Registrar/Office
           Janet Autry                           1979           Registrar/Office
           Ruthie Coaxum                         1988           Registrar/Office
           Dana Burgess                          1998           Registrar/Office/Computer
           Charlotte Farmer                      1992           Registrar/Office
           Carol Howard                          1992           Registrar/Office
           Max Howard                            1992           Ring/Security
           Dave Dillingham                       1981           Security
           Charles Farmer                        1992           Ring/Security
           Nancy McConnell                       1990           Registrar/Titles
           Walter McConnell                      1990           Registrar/Security
           Zabe Boles                            2003           Bidspotter
           Catherine Boles                       2005           Registrar/Office/Administrative support
           Elizabeth Burgess                     2004           Ticket runner

         Lone Star Auctioneers, Inc. is comprised not only of corporate staff, but also of a
         large number of experienced, capable individuals whom Lone Star regularly calls
         upon to staff auctions and sizeable projects. All but a very few of these employees
         work auctions exclusively for Lone Star Auctioneers. Many have worked Lone Star
         auctions regularly for over ten years.


         Lone Star has adequate staff resources to accomplish all aspects of this solicitation
         without interrupting or sacrificing any other contract or project.                            Lone Star
         Auctioneers can pull experienced personnel from our flexible staff roster to
         accomplish any task or complete any project.

4.3 Bidder will be solely responsible for doing the necessary research to ascertain that
its solution meets or exceeds all federal, state and local regulations, rules, standards
and requirements relating to conducting Internet public actions.

Lone Star Auctioneers meets and/or exceeds all such required rules, regulations, standards
and requirements to conduct public online auctions.


We will collect, accurately report, and remit all applicable state and local sales taxes on
each Member’s merchandise on a timely basis to each Participating Agency Member
involved.




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4.4 Contractor shall provide ongoing training opportunities and documentation for sellers
and buyers. Training may be conducted through webinars.

1.       Seller Training


         Once AEPA identifies the personnel who will be involved with the online auctions,
         we can schedule their training.


         a.        Full-Service 24/7 Online Auctions


                   If awarded this contract with AEPA, Lone Star Auctioneers will conduct all
                   necessary training and familiarization for Member Agency and Participating
                   Agency personnel through web training, teleconferencing and/or one-on-one
                   with agency personnel as needed.


                   Each phase will be covered thoroughly so trainees will leave with a working
                   knowledge of the program. Key personnel will be able to perform their
                   necessary functions at an operational level at the completion of the webinar
                   or other training.


                   If additional time is needed at the end of each web seminar that cannot be
                   effectively covered by phone, we will be prepared to extend the seminar as
                   necessary. The training is sufficiently simple and straightforward, so we do
                   not anticipate that this extension will be necessary. The durations of each
                   part of the seminar can be adjusted to accommodate the participant’s level of
                   familiarity with the various topics.


                   Lone Star Auctioneers will provide unlimited technical support and periodic
                   free training to Member Agency personnel for the duration of this contract.
                   This training and support will be available via our toll-free number,
                   800.275.3336.


                   There are only three phases of training required for this program: digital
                   photography, spreadsheet preparation and familiarization with interpreting
                   the post-auction reports provided by Lone Star. Each phase comes with a


AEPA IFB 007-G, Part B, Online Auction Service                       Due: October 27, 2006 at 1:30pm EST
                                                 Page 16 of 86
                   single page of simple instructions. Our team provides your project personnel
                   with these instructions and then walks each of them through each step of the
                   training until your personnel are comfortable with the process.


                   i.        Digital Photography - Member Agency and Participating Agency
                             personnel are instructed and trained in:


                             (1)       the general use and operation of digital cameras as necessary;
                             (2)       the required digital format and resolution of the images
                                       required by our system. Our online program requires only the
                                       standard resolution for even the least expensive digital cameras
                                       for good quality images online. There is no need for the
                                       Member Agency and Participating Agency or participating
                                       members to provide any sort of expensive equipment for this
                                       contract;
                             (3)       assignment of lots, general photo composition, photo angles,
                                       lighting, important features to record and naming of the
                                       photos to correspond to the lot number;
                             (4)       the number of photos to be taken for any lots having special
                                       features requiring multiple views; and
                             (5)       transmitting images either by email or by File Transfer
                                       Protocol (FTP) to our Website Administrator.


                   ii.       Spreadsheet preparation - Member Agency and Participating Agency
                             personnel will be trained in:


                             (1)       basic spreadsheet operation for either Microsoft Excel or
                                       WordPerfect QuattroPro as needed;
                             (2)       preparation of descriptions and formatting of information into
                                       the proper spreadsheet columns. Most of our clients require
                                       only four or five fields of information. This can be customized
                                       to the Member Agency and Participating Agency’s needs;
                             (3)       transmittal of information by email to our Website
                                       Administrator;


AEPA IFB 007-G, Part B, Online Auction Service                            Due: October 27, 2006 at 1:30pm EST
                                                    Page 17 of 86
                             (4)       developing and maintaining a master spreadsheet for asset
                                       tracking, sequential lot number maintenance, audit trails, etc.


                             This spreadsheet preparation is the basis for creating auctions online.
                             To minimize the opportunity for transcription error and to speed the
                             addition of lots to the online software, we have a spreadsheet import
                             feature that uploads the entire auction in a single process. This
                             feature is not available in our Partial Service Program. However,
                             there is a streamlined bulk-load feature which simplifies the addition
                             of lots individually.


                   iii.      Post-Auction Report Familiarization - We will explain each of the
                             reports, their content and application to designated Member Agency
                             and Participating Agency personnel. Complete sample copies with
                             written explanations of the purpose of each report will be provided by
                             Lone Star.


2.       Support Services


         a.        Full-Service 24/7 Online Auctions


                   i.        Lone Star Auctioneers will provide unlimited customer and technical
                             support to AEPA Member Agencies throughout the duration of this
                             contract;
                   ii.       We will provide unlimited customer service to buyers, bidders and the
                             general public for AEPA online auctions by email or through our toll-
                             free number;
                   iii.      We will provide initial training for each of the eighteen (18) AEPA
                             Member Agencies who are shown to be participating in this contract.
                   iv.       We will offer Participating Agency Members periodic training and
                             retraining through our Internet webinars, and our toll-free number as
                             available;
                   v.        We will provide to Member Agencies the cellular numbers for the
                             Project Manager and officers of Lone Star Auctioneers for emergency
                             contact;
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                   vi.       We will provide additional telephone training and support materials
                             as needed as staff is available;
                   vii.      We will continue to provide a state-of-the-art, user friendly, eBay
                             emulation software with advanced user features;
                   viii.     We will provide a Lone Star-owned, dedicated server with no fewer
                             than two dual core 2.8 GHz Xenon processors (total processing speed
                             approaches 5 GHz) with no fewer than six “hot-swappable” 15,000
                             rpm, 73 Gigabyte SCSI hard drives in a RAID 5 configuration with
                             twin “hot-swappable” power supplies, multiple “hot-swappable”
                             cooling fans;
                   ix.       We will provide a new Lone Star-owned dedicated external hard drive
                             with at least 320 Gigabytes of memory with special software to back
                             up data files daily and program files weekly;
                   x.        We will provide multiple T-1 broadband lines for Internet access to
                             the server;
                   xi.       We will provide 24/7 technical support for the server by the program
                             developers;
                   xii.      We will provide four (4) hour on-site parts and labor support for the
                             server from the manufacturer;
                   xiii.     We will provide free periodic seamless software and hardware
                             upgrades for the duration of this contract without interruption of
                             service;
                   xiv.      Lone Star will assist the Member Agency and Participating Agency in
                             developing reserve bids on specific items of value and will provide
                             help or determine starting prices for Member Agency and
                             Participating Agency surplus based on our extensive experience;
                   xv.       We will perform market research utilizing a variety of tools at our
                             disposal including market results for heavy and specialized equipment
                             sold at auction world-wide to aid the Member Agency and
                             Participating Agency in establishing prices and minimums;
                   xvi.      We will notify bidders in our historic database of 25,000 names about
                             AEPA member auctions to establish our online presence in the area.
                             We have a significant number of vehicle and equipment buyers
                             throughout the U.S. who have been drawn to the 75 live auctions we


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                                                  Page 19 of 86
                             have performed for the State of Texas and other government
                             agencies;
                   xvii.     We will advertise in local newspapers and weekly publications to
                             increase our market for miscellaneous surplus;
                   xviii. Lone Star offers the secure use of the domain names specific to the
                             Member Agency’s state for use as a link to the Member Agency and
                             Participating Agency’s website and in advertising as requested (such
                             as www.AZschoolsurplus.org, www.MTschoolsurplus.org,
                             www.NMschoolsurplus.org, www.PAschoolsurplus.org, and
                             www.WAschoolsurplus.org, all of which we currently own);
                   xix.      We will provide these same services for all non-AEPA agencies who
                             participate under this contract with AEPA approval.


3.       No Cost Items


         Lone Star Auctioneers will perform all of the foregoing services in Section 4 above
         for the proposed commission rates. There will be no extra costs or fees for any of
         those services. The following is a list of additional services and features that we will
         provide at no cost under this contract:


         a.        Internet training for Member Agency and Participating Agency personnel at
                   convenient times for Member Agencies at the initiation of the contract;
         b.        Full-time, business hours email and telephone customer and technical
                   support for the Member Agency and Participating Agency and the general
                   public via our toll-free number, 800.275.3336;
         c.        Member Agency and Participating Agency-specific local advertising and
                   promotion to increase awareness of the online auction program as
                   appropriate to the nature and value of assets offered;
         d.        National and trade advertising for qualifying online auctions;
         e.        Displays at national trade shows (most recent was NPI Annual Conference in
                   Florida in November 2005;
         f.        Interactive websites that receive 20 to 30 million hits per month;
         g.        More websites linked to our interactive websites than our three major
                   competitors (5,982 other websites link to Lone Star while only 4,215 sites link
                   to our three major competitors’ sites combined);
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                                                 Page 20 of 86
         h.        National geographic distribution of 25,000 plus individuals in our direct mail
                   postal database and 25,000 in our email databases;
         i.        Dedicated domain names specific for AEPA members which can be used to
                   “brand” the Member Agency’s online sales and present a public entity portal
                   as opposed to a private entity portal for AEPA constituents and bidders;
         j.        Up to four images per lot to display multiple aspects of each lot on the
                   Internet;
         k.        New dedicated server installed January 2006 as described above with
                   multiple T-1 broadband Internet access;
         l.        Automatic daily data backups toa dedicated 320 Gigabyte external hard
                   drive;
         m.        24/7 technical support for hardware and software;
         n.        Server hosted in a protected utility grid;
         o.        Periodic hardware and software upgrades;
         p.        Ability to block banned or sanctioned bidders. A no pay, no return policy
                   works especially well for Lone Star clients;
         q.        Unlimited access to the inquiry and search features for partial service
                   auctions; and
         r.        A dedicated, full-time staff committed to facilitate and simplify the online
                   experience for AEPA personnel and generate revenues exceeding historical
                   results.


4.       Buyer Training and Customer Service


         We have found through experience that our buyers require very little assistance or
         training to use our 24/7 online software. Our site works almost exactly like eBay in
         its vocabulary and functionality. It is a user friendly online website that includes
         “Help” and “FAQ” sections.


         Our personnel are available by email at Service@LoneStarAuctioneers.com. They
         may also call us on our local or toll-free numbers at 817.740.9400 or 800.275.3336
         for customer service and technical assistance from 7:00 A.M. until 5:30 P.M.
         Central Time.




AEPA IFB 007-G, Part B, Online Auction Service                       Due: October 27, 2006 at 1:30pm EST
                                                 Page 21 of 86
         Bidders usually call our offices where our staff is qualified to answer questions
         about how to bid, what something means or other questions about a particular
         auction or the site in general. We provide email and phone support during office
         hours to our bidders. All phone questions are answered during business hours
         immediately. We answer all emails promptly the same day if possible. All emails are
         answered no later than the next business day.            Lone Star has twelve full-time
         employees in our offices in Fort Worth to provide support.




5.       Online Auction Activity Reports Available to AEPA Agencies


         The following online auction reports are available to full-service clients:

         A.        Auction Status Report

                 This report summarizes the financial details of the auction including the total
                 sales, total applicable sales taxes, shipping and handling and insurance, total
                 buyer charges, total buyer payments, net due from buyers, total consignor
                 sales, total commissions earned and net due to consignors.

         B.      Final Statement Report

                 This is the Consignor Status Report which details the sales by agency,
                 accounting code, fund code, department or any other allocation of funds. This
                 would allow AEPA agencies to track the sales of each district or fund account.

                 This report is printed by district, fund or department account and provides the
                 auction (lot) number, buyer number, buyer and company name and address,
                 phone and fax number, winning bid amount, tax (if applicable), number of lots
                 sold and total sales for that district, fund or department, commissions and
                 expenses and net due consignor.

         C.      Consignor Summary Report

                 This report summarizes the total sales, commissions, expenses (if applicable),
                 and total due the consignor for a group of auctions by district, fund or
                 department for a client and gives the total of those categories for that client.



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                                                 Page 22 of 86
         D.      Active Buyers Report

                 This lists the active buyers with their buyer number, buyer and company name
                 and address, phone and fax number, email address and user name that
                 participated in that particular auction.

         E.      Buyer Payment Report

                 This details the payment amounts, payment type (cash, certified check, money
                 order, wire transfer) and sequential invoice number by buyer including buyer
                 number, buyer and company name and address, phone and fax number.

         F.      Lot Sales Report

                 This lists the group’s auctions in lot number order giving the description,
                 buyer number and the winning bid price totaled to match the other consignor
                 reports.

         G.      Sales Tax Report

                 This lists the taxable sales, tax rate and total taxes by consignor (if sales taxes
                 are applicable).

         H.      Accounts Receivable Report

                 This lists by sale the buyer number and name, the phone number, the amount
                 due, payments and any account receivable balance by buyer totaled for the
                 sale.




         Monitoring the Online Auctions (Optional Emails and Inquiries)


         AEPA agencies can receive email copies of each invoice for each buyer and copies of
         their “receipt of payment” emails at your option.           AEPA agencies can elect to
         receive copies of any other email notifications we send to bidders and buyers. It is
         up to AEPA agencies to determine which buyer emails are of importance to you.



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                                                 Page 23 of 86
         AEPA agencies may observe the conduct of the auction throughout the period of
         time the items are posted and well beyond (as completed items). AEPA agencies will
         be able to monitor current bids, dynamic closings, bid history and all activity during
         an auction.


         AEPA agencies will receive a full compliment of reconciled post-auction reports
         along with payment to AEPA agencies in accordance with the specifications at the
         conclusion of each auction.


6.       Agencies will be able to control which bids result in a sale. Further, the seller must
         have the ability to enter the system, post, withdraw or modify bids on a daily basis.

4.5 Contractor shall provide easily accessible and highly responsive technical support
and customer service. Problems identified by sellers or buyers shall be responded to in
writing within forty-eight (48) hours of notification. The applicable contracting AEPA
Member Agency shall be notified of all problems and resolutions.


         Most aspects of tech support and customer service for AEPA is covered in the
         preceding section. All problems or issues identified by buyers or sellers will be
         addressed in written responses within forty-eight hours of receipt. The appropriate
         Member Agency will be notified of issues, responses and resolutions. Lone Star
         Auctioneers has had very few technical support or customer service issues in the
         past for our online auctions considering the volume of business conducted.


         Lone Star Auctioneers will respond within twenty-four (24) hours (usually same
         day) by like communication, either phone or email for non-emergency
         communications. In the case of an emergency, we are available immediately. An
         officer of the company or the Project Manager can get back to the client within two
         hours. Our average response time is two (2) to four (4) hours.


         We are always open to telephone or email feedback regarding questions or problems
         from our sellers and buyers, as well. Our personnel are available, cooperative and
         helpful to our customers. We all try to fix problems, answer questions and deal with
         issues quickly.


         Other ways we can receive client and buyer feedback is through the Customer
         Service email address (Service@LoneStarAuctioneers.com) on our website or
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                                                 Page 24 of 86
         through the FAQ section of the online site. Our site is simple and stable so we do
         not get a lot of activity on our FAQs.



4.6 Contractor shall effectively market the program to potential sellers and bidders.

         Website Creations and Placement


         This section describes how Lone Star will develop and reach Internet buyers for
         AEPA online auctions:


         1.      Upon notice of participation by a Member Agency or Participating Agency
                 Member, we will create a dedicated interactive site for that agency or
                 participant on our 24/7 online auction homepage, LoneStarOnline.com. This
                 will be at the Member Agency’s choosing;
         2.      Approximately two weeks prior to a paricipating agency’s auction, we will
                 create a “Featured Auction” link on our lonestarauctioneers.com, home page.
                 This link will take bidders directly to an interactive, dedicated 24/7 site for that
                 agency on which bidders can register and bid on that agency’s items. If AEPA
                 or Member Agency requests, the dedicated site can be Member Agency
                 specific, (i.e. state specific) and each Participating Agency Member will be
                 listed as a category under that Member Agency; and
         3.      From the time the notice of the auction is posted, we will begin to process
                 online registrations, qualify bidders & payment methods, etc.




         Auction Marketing, Advertising Placement and Costs


         Lone Star Auctioneers will be responsible for all the marketing, advertising and
         promotion for each auction.             We will design, develop, proof and place all
         advertising. We will be responsible for all costs thereof.




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                                                 Page 25 of 86
         List of Trade Publications, Broadcast Media and Newspaper Advertising Lone Star
         Auctioneers has used for client-specific and asset-specific auctions and for general
         buyer development advertising in the past six (6) months:


         Lone Star proposes to advertise appropriately for the types, values and quantities of
         assets contained in each Member Agency and/or Participating Agency Member
         auction. Ad sizes, specific publications and quantity of print advertising, would
         vary depending upon the asset mix and value. The following is an example of the
         types and placement of advertising we do for significant auctions. Of course, the
         campaigns for each of the Participating Agency Members would not approach this
         magnitude of advertising, but instead would be appropriate for the types and values
         of merchandise offered.                 We will work diligently to design the appropriate
         advertising for AEPA, each Member Agency and each Participating Agency
         Member to generate maximal outcomes in the liquidation of their assets.


         The following is a proposed advertising plan for a major USMS auction. One can
         see our breadth of market and experience in advertising auctions that our
         marketing experience will be brought to bear under this contract in order to
         optimize seller proceeds.


                             Type of                  Publication            Advertisemen
                            advertising                 Name                    t size
                                                    Los Angeles        1 col x 4" Display
                                                    Times
                                                    Los Angeles         In-col 1 col x 3"
                                                    Times                    Display
                                                    Wall Street        1 cols x 2" Display
                                                    Journal
                                                    USA Today           In-Col Classified
                                                    Investors          1 cols x 2" Display
                                                    Business Daily*
                                                    New York Times    In-column or Display
                                                    Washington        In-column or Display
                                                    Post
                                                    Chicago           In-column or Display
                                                    Tribune
                                                    Atlanta Journal   In-column or Display
                                                    Constitution

                          Trade
                          Advertising               National                  Page
                                                    Jeweler*
                                                    National               Web Page
                                                    Jeweler*
                                                    Modern                 Classified
                                                    Jeweler*
                                                    World Coin                Page


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                                                      Page 26 of 86
                             Type of                Publication         Advertisemen
                            advertising               Name                 t size
                                                 News*
                                                 Antique Week*          ⅛ Page
                                                 Antique Week*          ½ Page
                                                 Antique                 Page
                                                 Trader*
                                                 Antique               Web Page
                                                 Trader*
                                                 Coin World              Page
                                                 Linn's Stamp         1 ½" x 3 ½ "
                                                 News
                                                 Bank Note              ¼ Page
                                                 Reporter
                                                 Numismatic              Page
                                                 News
                          Direct Mail,           Printing Color         6" x 8"
                          catalogues,            Postcards
                          website,               Postage & Mail
                          simulcast              DataTech
                          auction                Handling
                                                 Catalogues
                                                 Web Site
                                                 Live Internet
                                                 Auction
                                                 Simulcast
                                                 Proxy Internet
                                                 Auction
                                                 Electronic
                                                 notices (e-
                                                 brochures) sent
                                                 to e-mail
                                                 notification lists
                                                 LoneStarAuctio
                                                 neers.com and
                                                 simulcast
                                                 auction host


         Other newspapers in which we have advertised within the past few months include
         the Boston Globe, Miami Herald, Sacramento Bee, San Diego Tribune, New Orleans
         Times Picayune, Dallas Morning News, Fort Worth Star Telegram, and the
         Houston Chronicle, Trade publications in that time include Construction
         Equipment Guide, Waste News, Machinery Trader and World Coin.


         Note: The following section concerns our strategic advertising plan and
         procedures. Any release of this information to any person outside AEPA could
         seriously compromise Lone Star Auctioneers’ competitive position in the
         marketplace. This information should be treated as very confidential and should
         not be released to anyone.




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                                                   Page 27 of 86
         General Information


         Lone Star Auctioneers, Inc., has set the single sale record high for gross and net
         revenues for almost every recurring government auction contract that we have held
         and currently hold.             These records were achieved primarily as a result of the
         advertising and promotional efforts we expended on behalf of our clients. We draw
         qualified buyers from around the nation who compete to generate maximum return
         on the assets offered at auction.


         We will advertise AEPA auctions in publications which previous experience has
         shown us will draw the attendance of qualified buyers necessary to maximize
         auction revenues and return on appraised value. Lone Star will make every effort
         to reach buyers with general overall interest in the assets and to reach affinity
         groups for certain high value and unusual items. We will promote the auctions by
         U.S. mail, email, our Internet web site, Internet search-engine keywords, Internet
         auction listings, website links, phone, fax and other means at our disposal. When
         asset volumes and assets are appropriate, we will mail brochures to individuals who
         have historically bought like items at our live, webcast and online auctions, and we
         will email brochures to interested individuals who have signed up for notifications
         on our websites and who have participated in our Internet auctions (both WebCast
         and 24/7 online auctions).


         Lone Star will also target specialty markets with information well in advance of
         appropriate auctions to generate buyer interest from these "niche" and “affinity”
         groups to bring in new buyers for specific types of items.


         Our mailing list contains every buyer who has purchased a wide variety assets form
         Lone Star including surplus heavy equipment, vehicles, furniture, fixtures,
         computer equipment, and a wide variety of other surplus government property. It
         also includes buyers of seized, forfeited and unclaimed aircraft, offshore vessels,
         jewelry, diamonds, other gemstones, gold and silver coins and bullion, stamps,
         heirloom pieces, militaria, sports memorabilia, ephemera, collectibles, and other
         types of valuables. Our total auction sales exceed $250,000,000.




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                                                   Page 28 of 86
         Lone Star utilizes two additional sources of reference material that greatly enhances
         our ability to reach the specialty markets mentioned above. One is a publication
         which lists all regularly published trade journals, magazines, newspapers, tabloids,
         etc. in the U.S. It describes the readership, circulation and frequency and gives full
         contact information.             The other is a source book providing the names, phone
         numbers and addresses of collectors, newsletters, museums, galleries and
         associations for a seemingly endless array of special interest categories of jewelry,
         coins, stamps, artwork, collectibles, autographs, memorabilia, antiques, etc. Each
         category is divided into very specific areas of interest. This makes our approach to
         finding markets for particularly unusual items in a given auction much more
         informed, organized and targeted. We prefer not to provide the names of these
         publications in this proposal but will gladly provide them to the evaluation
         committee if requested.


         Ability to Attract Large Numbers of Qualified Trade Buyers


         Lone Star Auctioneers, Inc.'s ability to attract large numbers of qualified buyers is
         aptly demonstrated by the average number of registered bidders that participate in
         so many of our auctions. Significant net revenue increases have been realized by
         almost every municipal, county and state client for whom we have sold jewelry,
         gemstones, precious metals, collectibles, surplus heavy equipment, vehicles,
         furniture, fixtures, equipment, seized and confiscated property. We sell over twenty
         (20) million dollars of such assets at premium prices each year. We have increased
         average attendance at virtually all auctions for our governmental clients. Most of
         those assets were government or not-for-profit agency assets.


         The advertising campaign outlined above has produced good participation by
         informed, qualified buyers at our USMS and unclaimed property auctions. At one
         live 2005 auction, we attracted registered bidders representing twenty (20) states
         and 111 cities. Lone Star’s saturation of different types of media, along with our
         sizeable number of national patrons, delivers buyers who will pay premium prices
         for a wide array of property types.




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                                                   Page 29 of 86
         Maintenance of Our Mailing List


         Lone Star maintains a comprehensive mailing list in a dedicated module of our
         state-of-the-art, computerized auction program.             It is designed for the
         comprehensive and efficient management of the names, addresses, attendance,
         purchase histories, categories of items bought and extensive other information of
         previous, buyers, bidders, and interested parties who have been added to our mail
         system.       With this system, we have the power to specify and select targeted
         individuals, businesses, or groups by previous attendance, purchase history, zip
         code, state SIC code, interest category, and/or many other selection criteria.


         At this time, our list for U.S.P.s. direct mailings has approximately 25,000 current
         names of buyers and prospective bidders who have attended our auctions or have
         requested addition of their names to our list to receive auction brochures. These
         names are coded into 83 separate categories of interest so that we can select targeted
         markets for particular types of merchandise.            In addition to these physical
         addresses, we have approximately 25,000 names in our active email database all of
         whom have requested to be on our electronic brochure notification list for upcoming
         auctions or who have participated in 24/7 and WebCast auctions. There is relatively
         little overlap in the direct mail and email lists.


         Our system automatically tracks each buyer's attendance record and purchase
         history at all Lone Star auctions. We can selectively pull buyers out of the system
         for a brochure mailing by numerous criteria such as type of assets purchased, total
         purchase history, recent purchase history, purchases or attendance since a
         particular date, state or zip code range of business or residence, etc. We keep our
         system current on a daily basis and perform a system-wide interest and address
         correction mailing periodically. We do not charge a fee for persons to be placed on
         our mailing list.


         Our system performs a geographic analysis of all attendees at each auction. This
         information can be used to evaluate the effectiveness of all advertising placed for
         each auction and can guide the future expenditures of advertising dollars to
         generate the highest return.


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                                                 Page 30 of 86
         Our system registers and retains the following information:                      company name,
         individual name, two address lines (for international buyers and domestic buyers
         with P.O. box and street addresses), city, state, nine digit zip, resale or exempt tax
         number, an "action date" for necessary action or a specific mailing date, up to
         fifteen separate mailing category codes, last auction attended, their total purchases
         to date, the dates of attendance and purchase amounts for each auction they have
         attended, driver's license number, telephone number, SIC code, tax status (taxable,
         resale, or exempt), Social Security number, Letter of Credit amount and date of
         expiration, and an activity indicator for mailing list selection and maintenance.


         In addition to automatically maintaining auction dates and purchase amounts, the
         history file attached to each buyer’s identifying information allows us to maintain
         histories or comments for each buyer such as "Buys loose diamonds" or "Walked
         ticket, may not return," and records and restricts those buyers whose credit is bad,
         whose checks have been returned, who have caused problems of some kind, and/or
         who have left without paying. Our system allows us to lock them out and prevent
         them from registering even when they attempt to gain entry surreptitiously.


         As described earlier, Lone Star's auction system automatically updates buyers who
         are in the mailing list.                In addition, each new buyer is coded by the type of
         merchandise they bought and is automatically transferred to our mailing list.


          From the CD-ROM, we can select any desired number of potential buyers by SIC
         code, by area code, city, county, state or zip code, by distance from the auction site
         using the auction venue as the geographic center of the search, by keyword in the
         business name and by a host of other criteria. Lone Star has established a matrix by
         which we can select the desired number of targeted names to try to maximize the
         response to our direct mail campaign. We can provide the evaluation team with a
         list of the counts by SIC code and selection criteria on request.


         Trade Publications and Magazine Advertising


         Lone Star Auctioneers will advertise special-interest merchandise in national and/or
         state trade publications depending upon the nature and value of merchandise and
         the logical sphere of interest needed to maximize auction revenue for that
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         merchandise. We will advertise in trade publications as the merchandise warrants.
         In addition to those publications named above, we will evaluate and use other trade
         journals and additional newspapers for their potential to provide cost-effective
         coverage of special interest or affluent segments of each market. Please see the list
         of media where we have previously advertised in the foregoing section of this
         Auction Marketing plan.


         We have advertised auctions in Contractors Hotline, Industrial Marketplace, Rock
         & Dirt, Wall Street Journal, Trade-A-Plane, DuPont Registry, Hemmings Motor
         News, The Robb Report, National Jeweler, Modern Jeweler, Estate Jeweler,
         Antique Trader, Linn’s Stamp News, Numismatic News, Coin World and World
         Coin News, Bank Note Reporter, Man at Arms and other trade publications as
         merchandise warrants.               We have advertised airplanes, heavy equipment, exotic
         automobiles, an off-shore supply vessel, jewelry, gemstones, and other seized and
         escheat valuables, in a wide variety of national affinity publications.


         The resource publications we describe under “General Information” at the
         beginning of this section has enhanced our ability to locate specific publications,
         affinity groups, newsletters, collectors, buyers, galleries, etc. on a national basis.
         These sources are great for the wide ranging diversity encountered in marketing the
         contents of surplus, unclaimed, seized and forfeited assets.


         Lone Star continues to aggressively pursue additional potential publications in
         which to advertise our auctions.                We do place advertising in new outlets to
         “prospect” for buyers for these and other auctions.                We continually research
         publications and special interest websites.


         Newspaper Advertising


         For appropriate auctions, we will place comprehensive advertisements in the
         "Auction Page" of the Sunday Classifieds in the largest commercial daily
         newspaper in the preview and auction areas. Ads will be placed for an auction in
         major-market daily newspapers prior to the auction.




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         In the past month, Lone Star has placed significant advertising in national and local
         newspapers specifically USA Today, The Wall Street Journal, Investors Business
         Daily, Atlanta Journal Constitution, Chicago Tribune, New York Times, Miami
         Herald and Washington Post and other daily newspapers nationally.


         Auctions will be advertised with display or category-specific in-column
         advertisements in the Sunday Classifieds as appropriate. This will reach the portion
         of the market that watches this section for notices of sales, particularly for surplus,
         seized and unclaimed property. In-column newspaper advertising may be placed
         for specific categories of property to attract buyers who do not routinely watch the
         Auction Section.           For certain merchandise, a specific newspaper section might
         generate added attention and interest. These "feature" sections will reach portions
         of the market that do not "cross over" to other feature sections.


         Lone Star Auctioneers will be totally responsible for all advertising and promotional
         costs for each auction that we place.


         Press Releases


         Press releases and Public Service Announcements will be issued to the media outlets
         in the areas of AEPA auctions including newspapers, television stations and radio
         stations. Personal contact will also be made with feature writers and broadcasters
         in markets as appropriate to the merchandise. Advance publicity of this nature is
         worth all the paid advertising money can buy.


         Linking Websites


         Currently, there are 4,260 other websites that link to our two interlinked website
         home pages. We continue to develop listings and hyperlinks on as many other
         related sites as possible and to research other special interest websites.


         Lone Star Auctioneers is listed with the ten (10) largest search engines on the
         Internet and numerous others as well. We are listed with Google, Yahoo, AOL,
         MSN, WebCrawler and at least five others.


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         Some of the websites on which we have “hyperlinks” for surplus, forfeited and
         unclaimed property auctions are:


         Listings and Hyperlinks:


         SCO website                                                     www.sco.ca.gov
         National Jeweler                                                www.nationaljeweler.com
         Antique & Collectible Exchange                                  www.tace.com “Calendar”
         Rapaport Diamond Network                                        www.rapaport.com
         Diamond Ring                                                    www.diamondring.com
         Collect.com                                                     www.collect.com
         Watch, Clock and Horology                                       www.timelinks.com
         Net Collection                                                  www.netcollection.com
         IAL Internet Newsletter                                         ww.usaweb@syspac.com
         National Auctioneers Association                                www.auctioneers.org
         Texas Auctioneers Association                                   www.texasauctioneers.org
         Contractor’s Hotline                                            www.contractorshotline.com
         Great Links                                                     www.gator.net/~designs/links.html


         Our Web Sites : LoneStarAuctioneers.com and LoneStarOnline.com


         We maintain one website which provides specific information on all our major
         upcoming auctions, live, WebCast and 24/7 online. A second website is exclusively
         for our 24/7 online auctions. We encourage AEPA Evaluation Team to visit our
         websites and review the different features for which we have become known. Both
         sites have become important tools in marketing major assets on a national basis, for
         surplus, forfeited and unclaimed property from the U.S. Marshals Service, the State
         of Texas, California State Controllers Office and many other government agencies.


         In September, 2006, LoneStarOnline.com received 24,000,000 hits. This is a huge
         number for a website, particularly for 24/7 site that is not named eBay. Online
         registrations           continue        to     grow          proportionately.             Traffic            on
         LoneStarAuctioneers.com is quite brisk. These sites will bring a lot of interest and
         attention to AEPA auctions if we are awarded the contract.


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         Our sites have a translator link that allows visitors to translate all pages on our site
         into one of two dozen languages. For non-English speaking buyers, they can send
         us E-mail in their language and, we can translate their message and send them a
         response in their language.


         Our sites are Section 508 compliant for the hearing impaired.


         We have a site evaluation service that provides us with hits, views, sessions, page
         requests, traffic activity, geographic origin and a host of other analytical tools.


         If Lone Star Auctioneers is awarded this contract, we will immediately create an
         Internet web page for AEPA auctions. With AEPA’s approval we can post an
         announcement on the website immediately upon award of the contract, that notifies
         interested parties to watch for upcoming auction dates. We strive to improve the
         appearance and information of our website on a continuing basis.


         Hyperlinks will be created from other relevant websites so that interested people
         can find out about the auction through other sources. These will include links from
         websites of specific publications where we advertise along with other sites.


         National Auction Calendars


         Contractor’s Hotline                               National Auction Calendar
         National Auctioneers Association                   Calendar for members and public
         Texas Auctioneers Association                      Calendar for members and public
         Internet Auction List                              National Auction Calendar


         We will place notifications of AEPA auctions in trade publications and on calendars
         such as the National Auctioneers Association calendar and the Internet Auction
         Listing. Many buyers who attend live auctions and bid in online auctions refer to
         these sources, and many of those contact Lone Star for additional information about
         our auctions.




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         Auction Calendar Listings


         All AEPA auctions will be included in Lone Star Auctioneers’ own printed and
         advertised auction calendar. This calendar is updated weekly and provides our
         buyers with the auction dates, the clients’ names, types of items to be sold, preview,
         registration and auction times, the city, state and address. Our updated calendar
         remains on our Web page and is distributed free of charge at all Lone Star auctions
         and at corporate headquarters .


         Additional Efforts


         Our company will personally initiate phone contact with those prospective and
         known buyers whom have been known to purchase or have interest in purchasing
         the types of merchandise in AEPA auctions. Our mailing list module allows us to
         select certain buyers by our selective criteria and automatically dial them through
         our computerized auction system.


         Lone Star Auctioneers regularly and routinely promotes and advertises in a broad
         geographic area sufficient enough to provide broad exposure for AEPA auctions.
         This good exposure is one of the reasons for our unparalleled success on behalf of
         our clients, and particularly our record breaking auctions for the U.S. Marshals
         Service, the State of Texas, California State Controllers Office, and Texas State
         Comptroller. We often hold record-breaking auctions for our customers, exceeding
         not only the best sales conducted by other auction companies, but exceeding our
         own best sales, too.

4.7 Contractor may charge a fee for services provided under the contract. The applicable
fee or fees shall be specified in the bid.


Please see our Pricing Sheet for details.


4.8 Contractor shall collect payment for items sold under the contract.

Lone Star Auctioneers routinely offers our 24/7 auction clients two performance options.
One is a full-service model which simplifies the responsibilities of the client. Under this
model, we provide our clients a spreadsheet template for submitting the information for


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their auction lots. They use that template to send us their auction items along with the
appropriate images named for each lot.


Lone Star posts, monitors and closes the auctions. We do all invoice notification including
sales taxes and any other required charges or fees. We collect all monies, pursue accounts
receivable and reconcile each client’s auctions. Once payment has been collected and
accounts reconciled, we send our clients a cashier’s check for their proceeds accompanied
by complete, reconciled documentation for an accurate audit trail. In addition, we collect,
report and remit sales tax appropriate to each client for all applicable sales. Client remits
tax to tax authority.




Lone Star has collected all payments from buyers for every government client for whom we
have sold 24/7 online auctions with the exception of one city. That city is in the process of
getting council approval to convert from the self-service posting and collection model to
the full-service model whereby Lone Star does the posting, collection and account reporting
to each client.


Our full service program is available to AEPA on a system-wide basis. If any AEPA
members prefer to self-post, we need to exert a level of discipline into the system. It is not
practical for us to collect proceeds including taxes and admin fees, to prepare checks for
net proceeds and admin fees, prepare and send reconciled accounting reports to
Participating Agency Members for random postings by myriad agencies without
established schedules.


To simplify the process for AEPA Member Agencies and Participating Agency Members,
Lone Star Auctioneers recommends that a schedule be established for each Member
Agency and that all Participating Agency Members with that agency adhere to the
schedule. These schedules can be developed by mutual agreement with AEPA and/or
Member Agencies.




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4.9 Contractor shall remit payment to the seller after deducting contractor’s fee and
AEPA Member Agency’s administration fee.


Our software is designed for us to collect, report and pay to Member Agency
administrative fees such as required under this contract. All payments for proceeds,
contractor fees and Agency admin fees will be accompanied by accurate, thorough
documentation.

4.10 Contractor shall remit the applicable admin fee payment to the contracting AEPA
Member Agency.

Lone Star will comply with this requirement without exception unless otherwise directed.


6.1 Experience

6.1.1 Indicate the number of years bidder has been in business.

Lone Star Auctioneers has been in business for over twenty-two (22) years. The company
was incorporated in June 1984.

6.1.2 Indicate the number of years bidder’s web based online auction program has been in
place.

Lone Star has had a 24/7 real-time, online surplus auction program in place since July,
2003. Our auctions prior to 2003 were predominantly live and webcast auctions. A rapidly
growing number of our current auctions for both long-term and recently acquired clients
are 24/7 online auctions. We conducted over 24,000 24/7 online auctions since then.


Our first online auction was conducted in November of 1999. Our first WebCast auction
was conducted in July, 2000. Technology and buyer access and acceptance have certainly
changed since then.


After extensive research, we located a software program in June 2003 which met our need
for functional superiority in online auctions we provide. The basic program was developed
in 1997. We purchased the software and had the designer customize it to suit our needs for
our government clients. Our technical personnel further modified it to give it the look and
functionality we needed. We also had our programmer write interfacing software that
improved the accounting and reporting facets of the package.




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Coincidentally about that same time, the City of Fort Worth, one of our long-time clients
since 1988, came to us and asked us to start a pilot 24/7 auction for them. The rest, as they
say, is history. Over the years we had continually set new revenue records for City of Fort
Worth fleet sales. Our annual live auction average since 1988 had been $571,000. In the
first twelve months of the online auction contract, we sold $886,965 in Fort Worth fleet
vehicles. Some of the prices have been record-breaking.


Lone Star Auctioneers has had 24/7 auctions running continuously since July 31, 2003,
when we started the first City of Fort Worth Equipment Services auctions. The City has
maintained a constant active presence on LoneStarOnline.com since that time. Other long-
term and new government clients have enthusiastically joined our list of online auction
clients, many of whom maintain a frequent, or steady online auction presence on
LoneStarOnline.com.

6.1.3 Provide resumes and information on key personnel including an account manager. Will
bidder 6.1.4 commit to the availability of these individuals for work under this contract?

Supervisory Staff


The officers of Lone Star Auctioneers are responsible for policy, planning and control and
decisions concerning the overall day to day operations of the company.                     Through
discussion, presentation and friendly debate, we attempt to achieve consensus decisions and
results. The CEO has final say and authority in all matters.


These individuals have such varied professional experience and approaches that each
brings a unique and interesting perspective to the philosophy and operation of our firm.
We enclose an Organizational Chart showing chain of command, management structure
and task responsibilities for work to be performed under this proposed contract.


Marilyn K Burgess


Majority shareholder, President, Chief Executive Officer and lead Auctioneer of Lone Star
Auctioneers.         As such, she bears ultimate responsibility for policy and operational
decisions.        On an operational basis, she is responsible for fiscal management,
administration, accounting, subcontract administration and personnel.



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Ms. Burgess has a B.S. from East Texas State University, an M.ED. from the University of
North Texas, plus 40 hours of Post-graduate work toward a doctorate at the University of
North Texas. Her B.S. degree is in Communication Skills and English, her M.ED. is in
counseling and Student Personnel Services and her post-graduate work toward her
doctorate was in Business Administration and Higher Education. She has an impressive
and extensive variety of seminar and continuing education credits.


Burgess's work experience includes nine years as Coordinator for the Human Relations
Department of the Fort Worth Independent School District where she supervised a
department of ten people. With her experience in human relations and as a licensed
professional counselor, she has an unusual ability to deal with people frankly and
forthrightly in all types of situations. This is a valuable asset in dealing with the numbers
of the general public to which we are exposed in the auction business.


She was in charge of leadership training on an institutional level for years on behalf of the
FWISD. This background in training and communication are critically important when
dealing with large numbers of employees who are required to perform auction functions on
a periodic basis.


Ms. Burgess's years of teaching experience has instilled her with an admirable ability to
exert control over large numbers of buyers in large rooms and has particularly enabled her
as an auctioneer.


Ed Lanford, Jr.


Vice President, Chief Operating Officer, Security Officer and minority shareholder, is
responsible for sale planning, public relations and marketing, advertising, security,
estimating and proposals and real estate acquisition and management.                  He provides
technical support to the financial, accounting and computer operations. He is also an
accomplished auctioneer.


Lanford has a B.A. in Zoology from the University of Texas at Austin. After graduation,
he attended the University of Houston pursuing a Master's degree in Physiology with plans
to attend medical school thereafter. Drafted out of graduate school, he was assigned to


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assist in research at the U.S. Army Environmental Hygiene Agency in Edgewood,
Maryland. He was the NCOIC for the Toxicology Division.


Upon discharge, Lanford matriculated at the University of Texas Graduate School of
Business where he took the two year M.B.A. program for individuals with non-business
undergraduate degrees. He has undertaken other studies at Johns Hopkins University in
Baltimore, Maryland, Texas Christian University and several campuses of Tarrant County
Junior College.


After graduate school, he served as Security Officer and Business Manager for Radiation
Research Associates, Inc., in Fort Worth, Texas. He received security training and was
certified by the Department of Defense. In these capacities, he was responsible for all
security matters and procedures from the generation of classified documents, their
transmission and reproduction, their final disposition and destruction, and all other
matters relating to the security of highly classified research. He designed and implemented
a classified document storage, accounting and control system which won a coveted national
security award from the Defense Contracting Administration.                  This management
experience particularly qualifies Mr. Lanford for the development, implementation,
supervision and control of the security requirements of this contract for the USMS. At
Radiation Research, he was also responsible for the supervision of the accounting functions
and non-scientific personnel.


From January, 1976 to late 1979, Mr. Lanford worked for Plastic Machinery Corporation
and became a shareholder and member of the board of directors of PMC/RAMCO,
manufacturers of heavy machinery used in the making of polyethylene and PVC pipe. He
was initially hired as Purchasing Manager and quickly moved up the ranks to positions as
Vice President, Vice President of Finance and Executive Vice President. In the capacities
of Vice Presidents, he was responsible for all operational functions except sales and
manufacturing management. Specifically his supervisory responsibilities included finance
and accounting, budgeting, purchasing, personnel, and general corporate operating
procedures. During this period, he played a key and significant role in the growth of the
company from approximately 30 employees and less than $1,000,000 in sales to 140
employees with $5-6,000,000 in sales.




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He did consulting work in comptroller functions, banking relations, manufacturing
resource planning and scheduling for Grayco Specialists, a manufacturer of heavy
equipment for the petroleum industry in 1980. Mr. Lanford became involved in the
auction industry in 1981 and has been actively involved as an auctioneer since then.


Mr. Lanford will be the Technical and Security Contact with the COTR for these areas
upon award of this contract. All security procedures have been developed, installed and
are functioning smoothly to the satisfaction of the COTR under the prior jewelry contract.
He will remain in charge until all aspects of performance have stabilized, and operational
procedures are thoroughly perfected and institutionalized.


Lanford will not only be performing supervisory duties but will bear functional
responsibility as well. It is of utmost importance that a sensible and cost-effective course be
charted from the beginning and that the COTR and the project leader mutually agree on
the smartest and best approach to optimal contract performance.


Project Coordinator


Anne Dalton, our Special Projects Manager is the proposed Project Coordinator for this
contract. She managed prior USMS National Jewelry Contracts and is managing the
current interim storage contract. She will be heavily involved in implementation and
organization of the daily performance aspects of the contract. Dalton’s fifteen years of
continuous experience will ensure that effective procedures are in place and operational
prior to the receipt of any assets.


Her responsibilities under the USMS Jewelry Storage and Online Auction Contract include
organizing and overseeing the functional aspects of asset management, including receipt
and tracking of STOs, database management and reporting, package receipt, opening and
asset verification, overseeing appraisals, invoicing, asset returns and retrievals, service of
process and auction planning and implementation for all jewelry, gemstones, gold and
silver coins and bullion, fine art, antiques and furs for all seizures on behalf of the U.S.
Marshals Service. We have stored U.S. Marshals Service assets in our vault until such time
as we have been ordered to liquidate them at public auction at various sites around the
western half of the U.S. She manages all aspects of this contract, and will continue to do so
if we are awarded this contract.
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Dalton’s experience managing similar contracts spans the past fifteen years.                     Under
Dalton’s direction, Lone Star’s record of performance is exemplary and has brought about
an impeccable record of handling assets. Dalton’s immediate experience with similar
contracts within the past ten years covers twenty-eight major live auctions and is
summarized below, although these figures reflect only the assets sold. The total value of
assets successfully managed and stored, but not sold several times the total figure shown
below:


           United States Marshals Service National Jewelry                           $11,065,210.0
                                                                 11 auctions
           Contract (live/Webcast)                                                               0
           United States Marshals Service Jewelry Contract
                                                                 5 auctions          $6,127,025.00
           West of the Mississippi (Live)
           Texas Comptroller of Public Accounts (Live)           8 auctions          $3,269,425.25
           California State Controller’s Office (live/Webcast    8 live
           and online 24/7)                                      auctions;
                                                                                     $8,803,941.43
                                                                 83+ 24/7
                                                                 online
           Colorado State Treasurer (Live)                       1 auction             $165,800.00
                Total                                                                $29,431,401.6
                                                                                                 8


For the California SCO and Colorado State Treasurer’s auctions Dalton was responsible
for receipt and          verification of assets, identification and marking of assets, database
management, secure vault storage, supervising staff and process for photography, lotting
and sealing items for auction, implementation of the advertising and promotional plans,
secure transport of assets, auction and preview security, catalog preparation and layout,
inventory management and control, securing assets after preview periods, accurate and
complete delivery of purchases to buyers, packaging and shipment of auction returns,
claimed item returns and reporting. For the Colorado auction, Dalton supervised and
directed the appraisal process as well.


Texas Comptroller of Public Accounts auctions require the same types of supervision, asset
management and security except that assets are not stored in Lone Star’s vault and the
state prepares the auction catalog. Dalton and the staff members who photograph, lot and
seal the assets travel to Austin, Texas to accomplish this part of the process, carrying all the
necessary equipment and supplies to accomplish each aspect of the process of preparing


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assets for auction. Lone Star takes physical possession of the assets immediately preceding
a preview and auction.


Dalton will be integrally involved with coordinating all functional aspects of the contract,
including receipt and acceptance of assets, appraisals, asset verification and appraisal
processes, lotting, photographing and sealing the assets for auction, preview periods, asset
transport, receipt and set-up of assets for auctions, video-taping, signage, catalog and
supplement to catalog, asset security, checkout and delivery to buyers, shipping to online
buyers, (Webcast and Online auctions), plus invoicing, database management, reporting
and deliverables and EFT transfers and confirmation emails. In addition, she assists Lone
Star’s officers in resolving and responding to security questions, asset questions, preview
and auction situations and a wide variety of other duties.


Dalton has a Bachelor of Science Degree from the University of Texas at Austin and a
Master of Fine Arts Degree from Texas Woman’s University.


Office, Administrative and Live/Webcast24/7 Online Staff




Paula Hooper
Online Project Administrator/Fleet Surplus Contracts/Project Manager for Federal
Vehicle Services Contracts/ Office Manager/Auctioneer
TX Auctioneers Lic. No. 12299


Paula Hooper is Office Manager/Administrator for multiple city contracts and is Project
Manager for our federal Vehicle Services contracts. She attended the Gregg School of
Auctioneering in December 1985 and has been licensed as an auctioneer since that time.
Hooper is a vital long-term member of Lone Star’s staff whose experience and expertise are
exhibited in many aspects of the company’s business transactions. She works directly with
clients for Online sales. In this capacity Hooper promotes Lone Star’s services to potential
clients and assists in the transition from live auction procedures to Internet auction
procedures and requirements. Ms. Hooper has experience in accounting and banking. She
is one of Lone Star’s primary on site computer operators and plays a vital part in all our
Webcast and Online auctions. She has completed numerous hours of course work at
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Tarrant County College. Her project management skills and computer proficiency are
exceptional.


Paul Wibbeler
Business Development/Auctioneer
TX Auctioneers Lic. No. 13922


Auctioneer Paul Wibbeler began working for Lone Star Auctioneers in November 2005
and joined the team full-time on January 1, 2006. Mr. Wibbeler brings with him valuable
auction experience and a love for the auction industry. That interest compelled him to
attend auction school twice: first graduating from the Nashville Auction School in
Tullahoma, Tennessee and then from Texas Auction Academy in Dallas, Texas. Wibbeler
has been involved in almost every aspect of the auction industry and is now bringing his
energy and enthusiasm to the Lone Star Team. After 3 years of active duty in the US Army
with an Honorable Discharge and after 24 years in the sign industry, he realized his dream
of becoming a professional auctioneer. He has been working as one ever since. With skills
in writing and vocabulary, a love of people and the auction industry, and endowed with
dedication and purpose, Wibbeler is an important to our staff.


Pam Kennedy
Accounting Manager


Ms. Kennedy has extensive background in bookkeeping, data entry, and all aspects of
office procedure. Kennedy spent many years as an office manager and has experience in
writing and submitting bid responses. She also has experience in the banking business. Pam
has been instrumental in the refinement and use of Lone Star’s online auction software and
is responsible for overseeing the closing, invoicing and collection of all online auctions. She
also oversees the distribution of funds to our consignors and keeps accurate and current
records of each auction. She also operates a computer at our Webcast auctions, assisting
live-online bidders via the computer during a live auction.


Karen Plunk
Advertising/Promotion Specialist




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Karen Plunk is responsible for all of Lone Star’s advertising and promotion on a local,
state, national and international level. Karen draws on over ten (10) years experience in
newspaper and print advertising and in the printing industry. She also does a significant
portion of our digital photography and image manipulation. Having pursued an Associates
Degree in Graphic Arts at Tarrant County College and having worked in the printing
industry, she is conversant with all aspects of advertising and publication layout, design,
and production.


Kathi Clark
IT Manager/Website & Online Auction Administrator/Internet Marketing/


Ms. Clark is responsible for web page design and maintenance for all of our websites at
www.LoneStarAuctioneers.com, and www.LoneStarOnline.com. She is an experienced
Web/Network Administrator who brings not only ten years of knowledge and skill to the
job, but also organization, reliability, and punctuality. With Clark on staff, Lone Star's
website is more accessible and active than ever before. In addition, our website has more
visits each month than at any other time in our history. Graduating with a double major, a
B.A. in Communication with an emphasis in Advertising, as well as a B.F.A. in graphic
design and photography from the University of Texas at Arlington, She is also responsible
for compiling and manipulating the digital images for the video tape, CD and the digital
image presentation which are used during live auctions.


Candy Gillespie
Project Administrator/City of Dallas and City of Fort Worth Auto Pounds/Cashier


Candy Gillespie is responsible for administering our City of Dallas, and City of Fort Worth
Auto Pound contracts. She manages all aspects of the contracts under which we sell
abandoned and impounded vehicles. She completes and mails all auction sales receipts,
titles, applications for title and is our primary contact for issuance of all vehicle paper
work. Ms. Gillespie is our title clerk who performs all aspects of the filing of certifications,
titles, applications for title and government form 97 for multiple contracts including State
of Texas, City of Irving, US Marshal Service Vehicle Services contracts.




AEPA IFB 007-G, Part B, Online Auction Service                    Due: October 27, 2006 at 1:30pm EST
                                                 Page 46 of 86
Marci Caldwell
Administrative Assistant/Federal Jewelry Contracts and State Unclaimed Property
Contracts/Cashier


Marci Caldwell assists our Project Administrators Paula Hooper and Anne Dalton in the
day-to-day activities of all auction contracts. She has proven herself to be a dedicated,
reliable and apt employee. At live auctions, Caldwell performs multiple functions in the
auction office. She is currently enrolled at Tarrant County College.


Willa Lister
Onsite Auctions Office Manager/Asset Shipping Manager


B.A.-Dillard University, New Orleans, LA; M.Ed. North Texas State University; Denton,
Texas; Doctoral Student, Kennedy-Western University, Wyoming; Licensed Professional
Counselor, State of Texas. Ms. Lister has been employed part time with Lone Star
Auctioneers since 1984. At live auctions she writes clerk sheets, performs bid spotting and
at major auctions, she is responsible for managing the registration and payout activities
and responding to any issues that may arise related to our customers. Her primary
Corporate Office responsibilities include packing and shipping assets from online and live
auctions. Ms. Lister is a former educator and was a municipal administrator for more than
30 years, having been responsible for General and Federal Funds with budgets exceeding 8
million dollars. Lister serves as a volunteer with a number of non-profit City and County
organizations.


Chanse Awtrey
Online Assistant/Equipment and Facility Manager


Chanse Awtrey is responsible for the care, storage, maintenance and set-up of all our
equipment including vehicles, trailers, public address, electronic, and technical equipment.
He performs Vehicle Services for a number of contracts. Mr. Awtrey is a lead set-up
supervisor and make-ready person for live/webcast auctions. He also works as a bid spotter
at live auctions. He is also great assistance to our IT manager with our online software and
imaging.




AEPA IFB 007-G, Part B, Online Auction Service                   Due: October 27, 2006 at 1:30pm EST
                                                 Page 47 of 86
Elsa Valenzuela Edwards
Online Accounting Assistant/Accounting Assistant/Cashier


Elsa Edwards assists with the administration of Online auctions. She formerly worked as
the Project Administrator for Lone Star’s City of Dallas and City of Fort Worth Police
Auto Pound contracts and brings a great deal of auction experience to the process of
conducting our Online auctions. She provides back up to computer operators at live
auctions. Ms. Edwards is bilingual (oral & written) and she formerly worked for a major
corporation in Mexico where she was in charge of payroll for approximately 400+
employees.


Eugene Thompson
Computer Network Specialist/Set up/Security/Equipment


Gene Thompson has recently brought his experience to Lone Star Auctioneers after
amassing expertise in technical, operations, administrative and supervisory positions as
well as extensive PC networking and diagnostic skills. His experience extends into the
auction industry from having held various positions for a Salvation Army location which
held weekly auctions. Thompson was responsible for organization and oversight of those
auctions in addition to other duties. Thompson is responsible for auction set up and
security. In the Corporate Office, he will use his knowledge and expertise in computer
technology for Network administration and hardware and software operations. His
educational background includes an Associates Degree in Applied Science from The
Community College of the Air Force and completion of a majority of course-work toward a
B.B.A. degree, University of North Texas. He is A+ Certified and is retired from the U.S.
Air Force.


Sheri Buse
Online Accounting Administrator


Sheri Buse brings twelve (12) years experience as a legal secretary and seventeen (17) years
as a full charge bookkeeper to this position. Her experience includes engagements with two
law offices, a consumer credit company, a real estate management firm and a regional
industrial supply company. Buse was educated at McMurry University and Tarleton State


AEPA IFB 007-G, Part B, Online Auction Service                   Due: October 27, 2006 at 1:30pm EST
                                                 Page 48 of 86
University and is a member of the National Honor Society. She is well-versed and skilled in
a wide range of office productivity and accounting software.


Dave Dillingham
Pound Vehicle Specialist, Set-up/Security


Dillingham is responsible for preparing all pound vehicles for sale at auction. He unlocks
them, scrapes inspection stickers off and places Buyers Guides in the windows. His other
duties include setting up auctions and providing security of the merchandise and check-out.




Demetria Wallen
Receptionist/Administrative Assistant


Lone Star Auctioneers’ permanent live/webcast auction staff consists of full and part-time,
cross-trained of the company. The following lists provides their names, auction experience
(year licensed or began working auctions) and general auction duties:


           LIVE/WEBCAST                          SINCE          AUCTION DUTIES
           STAFF


           Marilyn Burgess                       1984           Auctioneer
           Ed Lanford                            1982           Auctioneer
           Bill Burgess                          1957           Auctioneer
           Wayne Rhodes                          1975           Auctioneer/Ring
           Miles Autry                           1972           Auctioneer/Ring
           Betty Burgess                         1981           Office Manager
           Willa Lister                          1984           Office Manager
           Paula Hooper                          1984           Computer     Operator/Webcast              computer
                                                                operator
           Anne Dalton                           1990           Project Manager/Office
           Pam Kennedy                           1995           Cashier/Computer/Webcast                   computer
                                                                operator
           Leah McClure                          2004           Administrative/Clerical


AEPA IFB 007-G, Part B, Online Auction Service                                    Due: October 27, 2006 at 1:30pm EST
                                                        Page 49 of 86
           LIVE/WEBCAST                           SINCE          AUCTION DUTIES
           STAFF
           Karen Plunk                            1997           Registrar/ Head Cashier
           Paul Wibbeler                          2005           Auctioneer/Sales/Administration
           Marci Caldwell                         2003           Registrar/Cashier/Computer
           Kathi Clark                            2004           IT/Webcast           support/Digital            image
                                                                 presentations
           Candy Gillespie                        2005           Registrar/Office
           Chanse Awtrey                          2005           Registrar/Office/Bidspotter
           Elsa Edwards                           1996           Cashier/ Registrar/Office
           Gene Thompson                          1990           Registrar/Office
           Sheri Buse                             2006           Cashier/ Registrar/Office
           Demetria Wallen                        2005           Registrar/Office
           Janet Autry                            1979           Registrar/Office
           Ruthie Coaxum                          1988           Registrar/Office
           Dana Burgess                           1998           Registrar/Office/Computer
           Charlotte Farmer                       1992           Registrar/Office
           Carol Howard                           1992           Registrar/Office
           Max Howard                             1992           Ring/Security
           Dave Dillingham                        1981           Security
           Charles Farmer                         1992           Ring/Security
           Nancy McConnell                        1990           Registrar/Titles
           Walter McConnell                       1990           Registrar/Security
           Zabe Boles                             2003           Bidspotter
           Catherine Boles                        2005           Registrar/Office/Administrative support
           Elizabeth Burgess                      2004           Ticket runner


Lone Star Auctioneers, Inc. is comprised not only of corporate staff, but also of a large
number of experienced, capable individuals whom Lone Star regularly calls upon to staff
auctions and sizeable projects.                  All but a very few of these employees work auctions
exclusively for Lone Star Auctioneers. Many have worked Lone Star auctions regularly for
over ten years.


Lone Star has adequate staff resources to accomplish all aspects of this solicitation without
interrupting or sacrificing any other contract or project. Lone Star Auctioneers can pull
AEPA IFB 007-G, Part B, Online Auction Service                                      Due: October 27, 2006 at 1:30pm EST
                                                         Page 50 of 86
experienced personnel from our flexible staff roster to accomplish any task or complete any
project.


6.1.5 Provide a list of current clients. For each client provide a contact person and contactt
information, the year the client began using the web-based online auction program, number of
online auctions conducted, and online auction dollar volume.

 CONTRACT             CONTACT              PHONE          Address                              EMAIL
                      NAME
 American Jewelry     Charles Tinsley      817-354-6900   1600 Airport Frwy #336               sales@americanjewelryexchange.com
 Exchange                                                 Bedford, TX 76022
 ARC Abatement        Ron Daniel-          254-755-6700   300 S 2nd
                      President                           Waco, Texas 76701
 Arrowhead Autos      Ross Darrough        713-641-6700   7786 Braniff                         thearrowhead@netscape.net
                                                          Houston, Texas 77061
 Austin State         James Pickens        512-419-2939   4110 Guadalupe                       james.pickens@dshs.state.tx.us
 Hospital                                                 Austin, TX 78751
 Burden Air           Jerry D Burden       214-943-9200   1802 Spann                           Jerry@Burdenair.com
 Conditining LTD                                          Dallas, Texas
 Burger King          Jack V Jones         817-881-2100   6505 Spyglass Hill Court
                                                          Fort Worth, Texas 76132
 City of              Paul J Calapa        956-548-6096   Brownsville City Hall                paul@cob.us
 Brownsville                                              1001 E. Elizabeth St.
                                                          Brownsville, TX 78520
 City of Bryan        Roger Dempsey        979-209-5500   1309 E. Martin Luther King Jr St.    dempsey@bryantx.gov
                                                          Bryan, TX 77803
 City of Cleburne     Kim Galvan           817-645-0900   City Hall                            kimbg@cleburne.net
                                                          10 N. Robinson
                                                          Cleburne, TX 76033
 City of Dallas       Gloria McNac         214-215-6135   320 E. Jefferson                     gloriamcnac@mail.ci.dallas.tx.us
                                                          Dallas, TX 75203
 City of Dallas       Jeff Rushing                        Dallas Zoo
 City of Euless       Michael Lowry        817-685-1447   Purchasing                           MLowry@ci.euless.tx.us
                                                          201 N. Ectoo
                                                          Euless, TX 76039
 City of Fort         Kevin Karle          817-392-5102   1000 Throckmorton                    kevin.karle@fortworthgov.org
 Worth                                                    Fort Worth, TX 76102
 City of Fort         Sal                  817-871-5956   1301 Northside Drive                 spinelli.salvatore@fortworthgov.org
 Worth                                                    Fort Worth, Texas 76106
 City of Fort         Robert Combs                        1000 Throckmorton                    robert.combs@fortworthgov.org
 Worth-FWES                                               Fort Worth, TX 76102
 City of Hudson       James M Freeman      936-875-2358   201 Mt Carmel Rd                     jamf@cox-internet.com
                                                          Hudson, TX 75904
 City of Irving       Darlene Rush         972-721-2631   845 W. Irving Blvd.                  drush@ci.irving.tx.us
                                                          Irving, TX 75060
 City of Lewisville   Todd White           972-219-3764   PO Box 299002                        AWhite@cityoflewisville.com
                                                          Lewisville, TX 75029-9002
 City of Lewisville   Rebecca Hunter       972-219-3765   PO Box 299002                        RHunter@cityoflewisville.com
                                                          Lewisville, TX 75029-9002
 City of Miami        Michael Rath         305-416-1921   Purchasing Dept.                     Mrath@ci.miami.fl.us
                                                          444 SW 2nd Ave 6th Floor
                                                          Miami, FL 33130
 City of Miami        Scott                305-416-1921   Purchasing Dept.                     Sdempster@ci.miami.fl.us
                                                          444 SW 2nd Ave 6th Floor
                                                          Miami, FL 33130
 City of Overton      BJ Potts             903-834-3171   PO Box D                             bpotts@ci.overton@tx.us
                                                          Overton,Texas 75684

AEPA IFB 007-G, Part B, Online Auction Service                                       Due: October 27, 2006 at 1:30pm EST
                                                      Page 51 of 86
 City of Trophy       Sargent Lee Delk     682-831-4650   100 Municipal Drive
 Club                                                     Trophy Club, TX 76262
 City of Waco         Asst Chief Clare     254-750-7656   1601 E. Taylor                      clarec@ci.waco.tx.us
                      Crook                               Waco, TX 76704
 CV & Coastal         Charles Vernon       512-454-0459   6904 Cameron Rd.                    CVSales@austin.rr.com
 Collateral                                               Austin, TX 78752
 CV & Coastal         Eric                 512-454-0459   6904 Cameron Rd                     CVSales@austin.rr.com
 Collateral                                               Austin,TX 78752
 CVS-                 Frank Roszell        817-232-5001   340 Blue Mound Rd                   vandolyn@prodigy.net
 Investments-                                             Suite 343
 Medical                                                  Saginaw, Texas 76131
 Equipment
 Dallas County        Linda Boles          214-653-6500   509 Main St Suite 623               Lboles@dallascounty.org
                                                          Dallas, TX 75202
 Dallas County        Gloria Torres        214-653-6500   509 Main StSuite 623Dallas,TX
                                                          75202

 Dallas MHMR          Melody Shelby        214-743-6161   1380 River Bend Dr.                 Mshelby@dallasmetrocare.com
                                                          Dallas, TX 75247-4914
 Denton county        Greg Anderson        972-221-4600   1660 S Stemmons                     ganderson@dcta.net
 Transit Authority                         x103           Suite 250
                                                          Lewisville, Texas 75067
 Eric Elam            Eric Elam            817-715-8010   7084 E. Mansfield Hwy               ignitedfw@msc.com
                                                          Kennedale, TX 76060
 Estate of Kelley     Sandra Ferguson      972-567-5562   PO Box 1781
 Ferguson                                                 Cedar Hill, Tx 75106
 Flashback            Allen Paul           254-898-2078   2721 S I35                          marmonroe50@hotmail.com
 Restaruant           Carvalho                            Burleson, Texas 76028
 FWISD                Lucia Chandler       817-871-2155   999 North University                lchan@ftworth.isd.tenet.edu
                                                          Fort Worth, TX 76107
 FWISD                Richard
 IES Electronics      Johnny Huffman       214-956-0682                                       johnny.huffman@millselectrical.com
 Industries
 Jefferson Parrish    Anthony Francis      504-364-2675   200 Derbigny                        afrancis@jeffparish.net
                                                          Suite 3300
                                                          Gretna, LA 70053
 JMJ Wrecking         Moraya Vazquez       254-799-5029   5623 Orchard Lane                   jmjwrecking@aol.com
 Yard & Used          or Jose Sanchez                     Waco, Texas 76705
 Cars
 Robbie King-         Robbie King          214-693-2204   4300 E Loop 820 S                   rhking@flash.net
 Truck & Trailer                                          Fort Worth, Texas 76119
 Services
 San Angelo State     Gene Marsh           325-465-2211   10950 US Hwy 87 North               gene.marsh@dads.state.tx.us
 School                                                   Carlsbad, TX 76934
 Secured Creditors    Steve Rosen          817-737-7775   PO Box 101583                       rosenautions@prodigy.net
                                                          Fort Worth, TX 76185
 Southwestern         Terry F Fisher       817-439-1995   12509 Business Hwy 287              racert57@sbcglobal.net
 Industril                                                Fort Worth, Texas 76179
 Specialties
 State Controllers    Ted Irwin                           State Contollers Office             tirwin@sco.ca.gov
 Office                                                   Division of Collections
                                                          Bureau of Unclaimed Property
                                                          3301 C Street Suite 712
                                                          Sacramento, CA 95816

 State of Texas       Shannon Franklin     512-463-9709   1711 San Jacinto Blvd               Shannon.Franklin@tbpc.state.tx.us
                                                          Austin, TX 78701
 Tarrant Regional     Marc Krantz          817-626-0400   1022 N. Calhoun St.                 mkrantz@trwd.com
 water                                                    Fort Worth, TX 76106-9097
 TCU                  Joe Laster           817-257-7957   TCU Box 298320                      j.m.laster@tcu.edu
                                                          Fort Worth, Texas 76129



AEPA IFB 007-G, Part B, Online Auction Service                                      Due: October 27, 2006 at 1:30pm EST
                                                      Page 52 of 86
 Texas Dept of        Mike Watkins         936-825-3728   Wallace Pack Unit
 Criminal Justice                                         2400 Wallace Pack Rd.
                                                          Navasota, TX 77868
 Tom Green            Mary Adame           325-659-6500   113 W. Beauregard                    mary.adame.@co.txo-green.tx.us
 County                                                   San Angelo, TX 76903-5887
 TWU                  Ned Harris           940-465-4341   Texas Woman's University             Nharris@twu.edu
                                                          1200 Frame St.
                                                          Denton, TX 76209
 Weatherford Mini     Buddy Lawrence       817-946-4310   1910 Ft Worth Hwy                    galarance@yahoo.com
 Storage                                                  Weatherford, Texas 76086



                       CLIENT                         AUCTIONS / LOTS                TOTAL
 American Jewelry Exchange Total                             1195          $        106,771.25
 Arrowhead Auto Total                                         22           $         94,665.00
 Austin State Hospital Total                                  14           $          9,435.00
 Burden Air Conditioning Total                               741           $         73,707.00
 Burger King Total                                            98           $          8,471.00
 California State Controller's Office Total                  5129          $      1,726,261.68
 City of Brownsville Total                                   126           $         49,043.00
 City of Bryan Total                                         354           $        451,622.50
 City of Cleburne Total                                      111           $        110,862.00
 City of Dallas Total                                        106           $        192,663.00
 City of Euless Total                                         39           $         59,168.00
 City of Ferris Total                                          4           $          7,875.00
 City of Fort Worth Equipment Services Total                 840           $      1,854,815.89
 City of Fort Worth Total                                    945           $        150,637.00
 City of Grapevine Total                                      35           $         28,255.00
 City of Greenacres Total                                     12           $            880.00
 City of Irving Total                                        489           $      1,202,169.73
 City of Lewisville Total                                    338           $        218,227.42
 City of Miami Gardens Total                                  12           $         16,250.00
 City of Miami Total                                          38           $         39,276.00
 City of North Miami Beach Total                              12           $         25,345.00
 City of Overton Total                                         5           $         22,475.00
 City of San Angelo Total                                     10           $          6,890.00
 City of Trophy Club Total                                     8           $          6,198.01
 City of Waco Total                                          255           $        106,140.00
 Coastal Collateral (CVS) Total                              3286          $        296,274.18
 Creative Fabrication Total                                    1           $          1,200.00
 CVS Tools Total                                             201           $         12,757.50
 CVSI Medical Total                                           54           $          1,455.00
 DACA Enterprises Total                                       11           $            355.00
 Dallas County Total                                         438           $        676,585.00
 Dallas Metro Care Total                                      14           $         39,375.00
 Dallas MHMR Total                                             9           $         16,497.02
 Flashback Restaurant Total                                   57           $          4,267.00
 Fort Worth Independent School District Total                500           $        310,829.00
 Goodwill Industries Total                                    46           $         32,630.00
 Irving Independent School District Total                     33           $         45,495.00
 Jefferson Parish Total                                        8           $        148,000.00
 Mills Electric Total                                        252           $         49,774.00
 Patterson Estate Total                                        8           $            765.00
 PONTIS Total                                                129           $         10,655.00
 San Angelo State School Total                                 7           $          1,720.00
 Secured Creditors Total                                     1894          $        232,404.00
 State of Texas Total                                        992           $      1,653,424.16

AEPA IFB 007-G, Part B, Online Auction Service                                       Due: October 27, 2006 at 1:30pm EST
                                                      Page 53 of 86
 Tarrant Regional Water District Total                        62       $      164,011.17
 Texas Department of Criminal Justice Total                   580      $       45,034.00
 Texas Woman's University Total                               136      $        2,468.00
 Tom Green County Total                                        4       $       19,000.00
 US Marshals Service (out of contract) Total                  78       $       26,934.00
 US Marshals Service National Jewelry Contract Total          545      $    1,488,312.50
 US Marshals Service Southern Dist of TX Total                25       $        1,802.52
 US Postal Inspection Service Total                           18       $       37,536.00
 US Treasury Department Total                                  5       $       40,225.00
 V-Bell Welding Total                                         57       $       19,289.50
 Weatherford Mini Storage Total                               19       $        2,700.00
 Wedgwood Rental Total                                        43       $        4,450.00
 Grand Total                                                 20450     $   11,954,328.03



6.1.6 Indicate the number of auctions posted on bidder’s website in the last two (2) years.
Indicate the number of successful auctions (items were sold), and the number of auctions
where the buyer defaulted on the purchase. Information to substantiate the list shall be
provided upon request.

Approximately 9,000 items have been posted on LoneStarOnline.com in the past two years.
The percentage of lots that are sold and collected in the initial offering is in the 95% range
(~8,550 lots). Selling to the second high bidder and re-listing lots yields a total sell-through
rate near 98% (~8,820 lots).

6.1.7 Indicate how many bidders are currently registered with the bidder’s website.

Over 20,000 bidders are registered to participate on LoneStarOnline.com. Another 4-5,000
are registered to receive our electronic brochures and online sale notices on
LoneStarAuctioneers.com.

6.1.8 Provide an implementation schedule including tasks resources durations and
dependencies. The implementation schedule should be based upon the number of days after
award of a contract.

Implementation Schedule


NOTE: In this section we will abbreviate Member Agency as MA and the Participating
Agency Member (each local educational entity) as PAM for simplicity.


Lone Star Auctioneers is prepared to start implementation procedures immediately upon
the award of the contract under either option.




AEPA IFB 007-G, Part B, Online Auction Service                              Due: October 27, 2006 at 1:30pm EST
                                                       Page 54 of 86
For the turn-key program we recommend for AEPA, depending upon the state of readiness
of Participating Agency Members, we could have the first series of auctions online and
running within thirty (30) days.


We have the trained and experienced 24/7 personnel capacity to commit to AEPA and its
Member and Participating Agencies.               Our 24/7 operational procedures are in place and
proven daily over the past nineteen months. We have designed and developed a special
accounting program which interfaces with the auction software to provide government
clients thorough, concise and reconciled reports and payments as soon as proceeds are
collected from each auction. Our staff is cross-trained and has a thorough understanding
of our software and procedures.


We are convinced that we can more efficiently upload the inventories and images, monitor
the progress of each auction, collect the funds, prepare, reconcile all auctions and accounts
and remit the funds within twenty-four hours of the deadline for buyer payment than
AEPA, its employees and its cooperating agencies.


Agency personnel will better serve their interests by allocating their time to the
development of accurate and thorough descriptions in spreadsheet format, taking good
quality digital images of each item to be sold, managing the surplus and confiscated
inventories and providing preview and checkout periods for the auction buyers.


To implement the program, Lone Star would need each PAM to provide us with the list of
auctions in a spreadsheet template we provide with good quality digital images identified to
correspond to each auction. Our personnel would transfer the spreadsheet with image
names into our bulk uploader, establish the start and end times for the auctions, post the
images and any starting bids, reserves or special features of each auction.


Tasks


Lone Star Auctioneers and each MA mutually determine:


1.       the points of contact for the MA and each PAM and Lone Star at the supervisory
         and functional levels and make the appropriate introductions;


AEPA IFB 007-G, Part B, Online Auction Service                        Due: October 27, 2006 at 1:30pm EST
                                                  Page 55 of 86
2.       the functional lines of communication for the day-to-day operation of the online
         auctions, operational modifications and for problem resolution;
3.       how many days each group of auctions will run;
4.       how many auctions will be included in each group on average;
5.       initial starting day of the week for each group;
6.       the staggered closing times for each auction within the group (one time decision);
7.       the periods for preview and removal of the merchandise which are convenient and
         efficient for each PAM and the staff responsible for this contract. These dates will
         be based on your needs. Some clients prefer to hold preview and removal during
         periods when onsite-staff will be available or when each PAM online operatives are
         most likely to be on site for other tasks such as developing descriptions, taking
         digital pictures, verifying VINs, etc. We want the time frame to work for the staff to
         maximize their productivity and convenience;
8.       the regular schedule for each PAM to submit the images and spreadsheets;
9.       the duration of each auction based on the type of items they are selling; and
10.      the forms of payment to be accepted, the deadline for payment from buyers after
         each auction closing, whether deposits will be required of bidders, how much those
         deposits would be.


Once all of these tasks are accomplished, Lone Star will email a completed form with the
above information to the seller to confirm prior to launching the program.


Program Introduction, Familiarization and Training


Week 1:          Contact is established with MAs for program and personnel introduction,
                 familiarization, provision of “How To” packets and to schedule first Internet
                 training session. All MAs and PAMs are invited to participate in any and all
                 training.


                 “How To” packet is provided to each MA and PAM including a spreadsheet
                 template with required column headings, formatting information, image size
                 requirements and information suggesting image composition, types and
                 numbers of images for different classes of assets with sample images for each
                 class. We will provide a checklist with the types of information normally
                 required for vehicles and equipment to guide PAM personnel through the
AEPA IFB 007-G, Part B, Online Auction Service                    Due: October 27, 2006 at 1:30pm EST
                                                 Page 56 of 86
                 description portion of the auction preparation. We will also provide direction
                 and assistance in determining relevant information about other classes of
                 merchandise.


                 Lone Star Auctioneers purchases “state”schoolsurplus.org domain names for
                 each MA to use on PAMS’ home pages and forwarded to LoneStarOnline.com.
                 Domain names are provided to each PAM.


                 Lone Star Auctioneers begins sales tax determination for each initial PAM
                 location.


Week 2:          Internet training conducted for MAs and PAMs.


Week 2-3: Follow-up telephonic support available for MAs and PAMs.


Week 3:


    Day 1: Spreadsheet and images are received from each PAM.


    Day 3-5: Within 2-3 business days (time depends on the number of items being added to
                 the site), the auctions are uploaded to start at a future date and links to the
                 auction listings are emailed to each PAM for review and changes.


    Day 6: Changes, if any, are emailed to Lone Star where they are received and made in
                 the listing.


    Day 7: Auctions go up online.


We want to emphasize that so much of this is development is going to be tailored to the
needs and comfort level of each MA and each PAM, particularly the employees who will be
working with us and the online auction on a daily basis. We recognize that you will not
necessarily have the answers to many of the issues addressed in this proposal. In most
cases, we will have solid suggestions and recommendations as to what the most effective
course of action will be. We will take into consideration and do our best to accommodate
your personal preferences and needs in determining our mutual approach to this contract.
AEPA IFB 007-G, Part B, Online Auction Service                     Due: October 27, 2006 at 1:30pm EST
                                                 Page 57 of 86
We want you to be as comfortable with the whole process as possible, and we are
determined to minimize any possible aggravation or pain in startup and operation of online
auctions.


Resources


With the growth of participation of the cooperative purchasing units, it may be necessary
for Lone Star to add staff to support the increased volume of traffic. At this time, we have
sufficient staff resources to accommodate AEPA and reasonable participation by PAMs.
We do not have any pending commitments that would affect our ability to service AEPA to
the highest standards. At this time, we do have reserve capacity in the form of long-time
part-time employees who can provide additional support to our full-time staff.


We will be able to anticipate that growth and deal with it in a timely fashion. We have
additional professional and technical capacity to meet the needs of this engagement.


Duration


PAM staff should be functional and comfortable with the process within the first week of
their participation in the program. Our full-service plan is very easy for the client to
become accustomed. If the client has any familiarity with the simplest of digital cameras
and even the most basic knowledge of either Microsoft Excel or WordPerfect/QuattroPro
spreadsheets or .xls, dbf or .csv files, they should have absolutely no problems with our
simple requirements.


If PAM personnel are not familiar with digital cameras or spreadsheets, we will help them
achieve a level of proficiency that will enable them to meet the needs of our system.


Dependencies


The timing of the first auction is dependent upon the effective date of the contract and the
state of readiness of each MA and PAM with regard to their familiarity with digital
cameras and spreadsheets, the items ready for sale and the status of descriptions and
digital imaging for those items.


AEPA IFB 007-G, Part B, Online Auction Service                   Due: October 27, 2006 at 1:30pm EST
                                                 Page 58 of 86
Program Administration Training


With the full-service program proposed, there is minimal program training required.
There is basic familiarization with the program described above in implementation and the
simple ongoing tasks of spreadsheet preparation and digital photography, but the
administration of the system and online auctions falls to Lone Star Auctioneers. It is really
that simple.


Responsibility for receiving payment from bidders


Lone Star Auctioneers will be responsible for receiving payment from buyers. We will
accept responsibility for all payment tendered by buyers and will remit net sales proceeds
and administration fees as specified in the solicitation.


We will also collect and remit to the Member Agencies any applicable sales taxes according
to the requirements of the applicable tax laws and regulations.

6.2 Software Functionality

6.2.1 Provide the URL for bidder’s web based online auction system.

www.LoneStarOnline.com is our 24/7 online auction website.

www.LoneStarAuctioneers.com is our general live, webcast and online website.

6.2.2 Describe the capabilities and functionality of bidder’s web based online auction system.

Software


Lone Star Auctioneers uses a proprietary, custom-designed software program that is state-
of-the-art. It emulates eBay almost identically in function but has a unique, Lone Star
interface. It is virtually infinitely expandable for almost limitless user access. There is
virtually no learning curve for buyers experienced with eBay.


Lone Star owns our custom 24/7 online software, and our personnel are highly proficient in
the administration and operation of our online auction program.


Our 24/7 software is written in Cold Fusion using a SQL database for virtually unlimited
access and scalability. Our software is proven to be completely functional and stable.
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When we purchased the package, we had the designers write custom functions for us to
meet our needs in performing 24/7online auctions for government entities. Then our
IT/Web Administrator customized the look and feel of our online package to give is a
unique package that was consistent with our home page and distinguished us from other
online auctions.


Next, we had our contract software designer, with whom we have worked for years on
other custom software, design an accounting and reporting package that interfaces with the
auction software emulating our live auction software reports. This accounting package
accounts for and reports the activity from each group of auctions in complete detail. After
each auction, we provide our clients with comprehensive, concise and reconciled reports by
individual auction (lot), buyer, payment, seller department or fund and other criteria.
These reports provide a complete audit trail for all items offered in our online auctions.


The designers of our basic auction package offer periodic upgrades. We are quite satisfied
with the system as it now works, but in the future, should we decide it would be
advantageous to upgrade our auction software, we would do so at no cost to AEPA. The
designers are very careful to test any changes, upgrades and customizations to the
software. They test it extensively in simulated real-time auctions.


We had certain features customized for us after the initial design upgrades and
modifications.         Our software designers are very responsive to our projects and have
provided a finished, thoroughly tested product on a timely basis. Any custom software
design we initiate will be at our expense. Any changes or custom programming required by
AEPA will be at AEPA expense as detailed in the pricing section.


Our software designers host our online server, provide 24/7 technical monitoring and
support and provide our customizations and periodic upgrades. Lone Star owns all our
server hardware and software. One January 30, 2006, we installed a new, state-of-the-art
server with multiple redundancy. Included was an external 320 Gig hard drive exclusively
for the nightly and weekly data and program backups.




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Hardware


We run LoneStarOnline.com auctions on a Lone Star-owned, dedicated server with two
dual core 2.8 GHz Xeon processors (total processing speed approaches 5 GHz) with six
“hot-swappable” 15,000 rpm, 73 Gigabyte SCSI hard drives in a RAID 5 configuration
with twin “hot-swappable” power supplies, multiple “hot-swappable” cooling fans and
other redundant features.


We backup nightly to a Lone Star-owned, dedicated external hard drive with 320
Gigabytes of memory with special software to back up data files daily and program files
weekly. We provide multiple T-1 broadband lines for Internet access to the server, 24/7
technical support for the server by the program developers, 24/7 four-hour on-site response
for parts and labor support for the server from the manufacturer (Dell) and we will
provide free periodic seamless software and hardware upgrades for the duration of this
contract without interruption of service.


Bandwidth


Lone Star Auctioneers has three and               one-half (3 ½) bonded T-1 lines with bursting
dedicated to provide high bandwidth to run LoneStarOnline.com.                     This bonded T-1
provides over three Gig of bandwidth and the “bursting” capability means that if our
bandwidth requirements exceed the three gigs basically unlimited additional bandwidth is
available seamlessly as needed. Three gigs is a very high level of bandwidth. Bandwidth is
a primary limiting factor of site speed. Before we moved to the dedicated T-1 lines, we
were sharing two T-1 lines with other sites. Our site is rated “very fast,” faster than 82%
of the sites on the Internet. Now that we have this dedicated capacity, our site should move
into the high 90 percentile.


Mail Server
Lone Star Auctioneers has its own dedicated email server software on a company-owned,
state-of-the-art server. This is to eliminate our dependence on commercial email servers
which are periodically out of service. If there is a problem with our email server and
software, we can immediately switch to a provider to maintain continuity of the automatic
emails generated by our online auction software.


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6.2.3 Indicate how often upgrades are made to the system including the testing processes used
before implementation of an upgrade.


We periodically upgrade features of our software as we recognize areas of improvement.
There is not a regular schedule to the upgrades. We have made some specific upgrades at
the request and expense of clients.


The designers of our basic auction package offer periodic upgrades. We are quite satisfied
with the system as it now works, but in the future, should we decide it would be beneficial
to upgrade the auction software, we would do so at no cost to the AEPA members. The
designers are very careful to test any changes, upgrades and customizations to the
software.        They test it extensively in simulated real-time auctions. Any software
modifications are thoroughly tested by the developers and our IT staff before
implementation.


We had certain features customized for us after the initial design upgrades and
modifications.         Our software designers are very responsive to our projects and have
provided a finished, thoroughly tested product on a timely basis. Any custom software
design we initiate will be at our expense.

6.2.4 Describe how customer feedback (from sellers and buyers) is received
considered and responded to. What is the typical methodology for requesting customization and
typical time frame for responding to such a request?

We receive feedback from sellers in several ways. We prefer to get it personally with a
phone call or email to the appropriate person or persons. We are a small, hands-on firm so
our owner/officers both like to hear from our clients, both the praise, problems and
constructive criticism. We encourage our clients to give us feedback.


Contractual and policy issues are best handled by top management. Most procedural and
functional issues may best be addressed by our IT/Web Administrator, Auction
Coordinator or Project Manager. They will refer relevant issues and feedback to the
officers of the company. The officers are always willing to accept the initial calls however.
Our primary interest is our sellers’ complete satisfaction.


Lone Star Auctioneers will respond the same day by like communication, either phone or
email for non-emergency communications. In the case of an emergency, we are available

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immediately. An officer of the company or the Project Manager can get back to the client
within two hours.


We are always open to telephone or email feedback, questions or problems from our
buyers, as well. Our personnel are available, cooperative and helpful to our customers.
We all try to fix problems, answer questions and deal with issues quickly.


Other ways we can receive client and buyer feedback is through the Customer Service
email address (Service@LoneStarAuctioneers.com) on our website or through the FAQ
section of the online site. Our site is simple and stable so we do not get a lot of activity on
our FAQs.

6.2.5 Describe the accounting process and online accounting capabilities, including but not
limited to documentation of invoicing, payment and non-payment by bidders.

Lone Star developed custom accounting software to integrate with our 24/7 online
software.


Once an auction or group of auctions has closed, we send each successful buyer a winning
bidder email, an invoice which lists his/her purchases, any applicable sales tax, buyers
premium and shipping and handling and insurance.                 These invoices are sequentially
numbered so we can track payment and shipping for each buyer.                     When we receive
payment, we send the buyers a notice of payment received and the tracking number if the
item(s) are being shipped to that person.


We maintain a consolidated database of all buyers from our live, Webcast and 24/7)
auctions. This database allows us to track purchase and payment histories as well as the
classes of assets they purchase.


Upon receipt of payment, we update the buyer history in our software program that tracks
all purchase history from the first purchase. If a buyer does not pay for purchases, we
send the buyer a letter saying they will not be allowed to participate in future auctions.
Then we block that buyer’s user ID, email address and de-activate that person in our
purchase history file. We note the details of their “non-payment” in their history. In an
effort to avoid this, our Online Administrator tracks unpaid invoices and personally



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contacts buyers who have not yet paid to assist them and encourage them to expedite their
payment.


We do not activate registering bidders for our 24/7 auctions automatically. We check all
registering bidders against our buyer database.                  Buyers who have failed to pay for
purchases are not allowed to register or bid in any of our auctions.

6.2.6 Describe the tools and customizations available to the seller for creating auctions including
but not limited to internal reallocation, dutch or split auctions, reserve prices, minimum bid
requirements, bidder deposit requirements, ability to copy previous auctions, ability to repost
previous auctions, etc.


Tools and customizations available to sellers:


The following topics address the features available to sellers through our online software:


   Fund Accounting
    We have the ability to report to the MAs and/or PAM by seller, department, fund
    account or other allocation.
   Internal Re-allocation
    We can establish a system for internal re-allocation if any MA requires.
   Changes
    We can reassign auctions or groups of auctions to other sellers, departments, fund
    accounts, etc.
   Dutch or Split Auctions
    We have the option of conducting English ( the customary convention), Dutch, Split,
    Yankee or Vickrey auctions.
   Reserve price
    We can set reserve prices (minimums) on particular items under which the program
    will not sell the item. We can change the reserve price during the course of active
    auctions.
   Minimum bid
    We can set minimum starting bids for individual auctions or groups of auctions.
   Bidder Deposits
    We can require deposits for certain auctions with the custom programming described
    above under “private auctions.”
   Copying Auctions
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    Our system allows us to copy all of the information from one auction to an unlimited
    number of other auctions with a few keystrokes. Only the information that is not to be
    duplicated requires entry.
   Relist function
    Auctions can be set to relist up to nine times automatically if they do not sell in the first
    auction.
   Reposting Auctions
    Our system only allows us to post an auction only once. Since the system retains every
    auction, it will not allow an auction with a duplicate number to exist. That would be too
    confusing. We can recreate the auction with a different number and re-run it.
   Bid Increments
    We can set bid increments which are appropriate to the types and values of items being
    sold. This is a feature we use to try to maximize “value related” bidding prices and
    activity.
•   Notification Emails
    The MA or PAM can decide which buyer notification emails it would like to receive and
    who within the MA or PAM should receive them.
•   Fund Accounting
    We have the ability to report to the MA or PAM and/or procurement unit by seller,
    department, fund account or other allocation unit designated by the MA or PAM.
•   Cooperative Purchasing Partners
    Any non-PAM participant approved by the MA or PAM to use this contract will
    received complete reconciled reports. No activity will be commingled with PAM
    auctions.
•   Internal Reallocation
    Lone Star can create a system for the PAM to reallocate surplus assets within PAM
    departments or for other approved entities.
•   Changes
    We can change virtually any aspect of an auction or lot including descriptions, images,
    etc. We can also reassign auctions or groups of auctions to other sellers, departments,
    fund accounts, etc.
•   Private Auctions
    We can create private auctions that require special authorization to participate, i.e.
    firearms auctions to law enforcement or ATF-licensed dealers, freon sales to licensed
    A/C contractors, alcoholic beverages to licensed warehousers, 8-liners to dealers out of
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    state buyers, etc. Participation for bidders would be upon proof of licensure or other
    stipulation dictated by the PAM.
•   Reserve Price
    We can set reserve prices (minimums) on particular items. The program will not allow
    the item to sell below the reserve. We can change the reserve price during the course of
    active auctions. The reserve prices will not be visible to the public. A “reserve not met”
    message will display for all bids below the reserve.
•   Starting Price
    We will set starting prices for each auction which will encourage bidding but
    discourage “lowball” bidding. These prices are visible to the public. The system will
    not accept bids below this level. The starting price can and is often adjusted during the
    course of the auction. This technique has worked quite well for our 24/7 auctions.
•   Bidder Deposits
    For 24/7 auctions, we discourage the use of bidder deposits. The cost of receiving,
    tracking, administering, applying, accounting for and returning deposits does not offset
    the fractional benefits of the deposits. We have a very high percentage of collection of
    payment.
    We will consider deposits for certain classes of items or for high value assets if the PAM
    so desires.
•   Copying Auctions
    Our system allows us to copy all of the information from one auction to an unlimited
    number of other auctions with a few keystrokes. Only the information that is not to be
    duplicated requires entry.
•   Re-post function
    Auctions can be set to re-post up to nine times automatically if they do not sell in the
    first auction. We have a high “sell through” rate and rarely have to relist auctions even
    though we achieve very good prices for our 24/7 auctions.




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6.2.7 Describe the tools available to the bidder for participating in auctions including but not
limited to email notifications, proxy bidding, identity protection, etc.


A. Finding Items of Interest


    Prospective buyers can quickly and easily find auctions of interest to them in a number
    of ways: by seller, by category, by key word search, by advanced search or by featured
    image or all images.


    a) Seller Agency - A list of current sellers appears on the left side of the home page will
         take them to the geographic sellers in a desired area or to a seller that has the type
         of merchandise of interest to them.


    b) Category – A list of assets types appears on the left side of the home page so they can
         select by the type of items they wish to purchase.


    c) Keyword Search - A Search box appears just above the Seller list on the page.
         Buyers can put in one or more words, and the system will return all matches.


    d) Advanced Search - Allows buyers to search by: item title or description keyword,
         seller, zip code (seller can define radius in miles from that zip code), lot number,
         auction status, date, any word, all words, or phrase, “Any” or “All” categories,
         active auctions, inactive auctions, or all, auctions, item ID number, and seller
         number. The buyer can specify the order of the output file.


    e) Image – Bidders can scan the ever-changing random feature images on the home
         page or they can click the link “View All Thumbnails” which takes them to the
         Studio Gallery. This page allows them to select a Seller or Category of interest.
         Upon doing so, images for ALL lots of that seller or in that category appear. By
         moving their cursor over an image, the lot number and description of that lot
         appear in a box on the screen.            Clicking on the image will take them to that
         particular lot for bidding or additional information.




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B. Easy translation into Spanish and twelve other languages

    At the bottom of our 24/7 home page is a link that appears as the flag of Mexico.
    Clicking this link translates this page and all subsequent pages into Spanish. Another
    “translate” link on the bottom toolbar allows a buyer to translate the pages into twelve
    other major foreign languages. There is a translator link on the bottom button bar of
    LoneStarAuctioneers.com as well.

C. Dynamic Closing


    Lone Star provides our clients the option of “Dynamic Closing.” This is one of the most
    important features of our program and the single greatest improvement over eBay-style
    “static” closings. It significantly increases our clients’ revenues.


    Static closing refers to an online auction which closes precisely at the scheduled time
    without exception. The last bid placed in the final moment before the stated time is the
    winner regardless of how many bidders may have been bidding or trying to bid at the
    close.


    This method is responsible for the practice known as sniping where bidders wait to bid
    until the very last minute in hopes of being the winner. One of the serious criticisms
    buyers have expressed with eBay-style closings concerns the problem of “sniping.”
    Sniping occurs when a bidder or bidders lay in wait at lower price levels and try to time
    their bid to occur strategically just as an item closes thus depriving other interested
    bidders of exercising their right to compete to any higher level. The legitimate bidder
    thinks they have the item won, and a sniper places a last second bid freezing out the
    other bidder.


    Dynamic closing counters the practice of sniping by extending the closing time when
    there is last minute activity on an item. If there is a bid placed within a pre-determined
    increment of time before the scheduled close, the closing is extended by that increment.
    If another bid is placed within that extension period, the closing is extended by the time
    increment. This continues until no bid is placed within the extension period. We
    determine the duration of the dynamic closing periods. A five minute window gives



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    bidders enough time to make their bid decision on a particular item and still be
    watching and bidding on other items which may be closing at the same time.


    Sniping harms both participating bidders and especially the seller in that snipers, in
    order to keep their ultimate purchase price low, do not bid until the final moment
    before closing. This deprives the seller of substantial revenue and the other bidders the
    opportunity to own the item for which they would have paid more.


    The problems with sniping are:


    a) price levels do not go as high during the course of the auction because some bidders
    are laying in wait for their chance to snipe;
    b) when the auction closes, there frequently are unsuccessful bidders who are willing to
    pay more than the winning buyer, but lost the sniping game in the final seconds;
    c) bona fide bidders are deprived of items by sniping; and
    d) the seller does not receive the full, willing market value of their assets. Money is left
    on the table.


    With static closings, the only winner is the sniper. The seller and all other bidders lose
    to the sniper without recourse.              We would not recommend conducting an auction
    without dynamic closing.


    All our current clients use dynamic closing exclusively as experience has demonstrated
    emphatically the value of this feature. We have seen online sale prices nearly double
    during the extended bidding period after the scheduled closing time as passed. As an
    example, the bids for one garbage truck went from about $16,000 to $28,850 in a
    dynamic closing period, which lasted 12-15 minutes. We have had the Dynamic Closing
    period and bidding continue for over 45 minutes after the scheduled close.


    We can set the duration of the dynamic closing periods. For instance, if the dynamic
    closing period is set to five minutes and a bid is placed one second before the scheduled
    close, our system will extend the closing time by five minutes. If a bid is placed within
    that five minute extension period, that will trigger another five minute window for
    bidders to participate. Only when there is no bid placed within the five minutes before
    close or any five-minute extension period after the scheduled close, will the item close
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    and the winner be determined. Our system has a feature that notifies bidders as they
    are outbid on an item.


    Lone Star Auctioneer’s owned online software provides our clients the option of using
    either dynamic or static closing for their auctions.



D. Access for the Visually Impaired


    Our website software conforms to federal regulations for use by the visually impaired.
    With free software, they can access our site which interprets each cursor position and
    link into an audio “read.”



E. Optional Emails


    Bidders select whether they want to be notified that their bid has been received in the
    system and/or when they have been outbid. They also have other options in terms of
    email notification.

F. Future Watch


    Bidders can list keywords under “Future Watch.”              Whenever auctions are listed
    containing those keywords, they are sent an email with links directly to those specific
    items of interest as soon as they are posted. Future watchers receive notification even
    before the items officially open. Bids may be placed by future watchers once they are
    receive the notification email.

G. Notification Emails

    The following emails are sent to our bidders at certain stages of the cycle providing the
    following information:

    Their registration information has been received;

    a) Their account has been activated to bid;

    b) Their account will not be activated because...;

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    c) Their bid has been successfully placed;

    d) They have been outbid by another bidder and should bid again;

    e) Notice they are the winning bid on lot(s)...and they will be receiving an email invoice
       to pay;

    f)   An email invoice with total purchases, taxes, shipping, expenses, and total due with
         payment terms and pick-up instructions (as applicable);

    g) Notice their payment has been received, pick-up instructions or notice their items
       will be shipped; and

    h) Notice that their items have been shipped and the tracking number of the shipment
       (as applicable).


H. “Autobid” or Proxy Bidding


    We have an “Autobid feature” which is an automatic proxy bid placed by the system on
    behalf of a bidder who cannot participate during the closing minutes or who wants the
    system to do it for them.


    To use this feature, the bidder selects the “Autobid” drop-down box to place his/her
    maximum bid on that item. They are advised as to the minimum bid increments they
    are allowed to use. They then enter their maximum bid, confirm it, and the system bids
    on their behalf in the set increments up to but not exceeding their maximum bid. If the
    current bid is $1,000 and the bid increments are $25 and the bidder places an Autobid
    of $2,000, the program will bid $1,025 automatically. That will remain the high bid
    until someone outbids them. At this time, the system will automatically bid to the next
    level until the Autobid amount is reached. If the Autobid buyer is not outbid, then
    he/she wins the item at $25 more than the last bid from other bidders.


    If there are two Autobids placed by different bidders, the system automatically takes
    the bidding to one increment greater than the top price of the lower auto bid.


    Therefore, a bidder has the opportunity to purchase the item at a bid no greater than
    his/her maximum Autobid price but also has the opportunity to win it at a lower price if
    not outbid.




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I. Identity Protection


    Lone Star Auctioneers has an SSL Certificate (Secure Sockets Layer) with “GeoTrust,”
    to maintain Internet security for people registering and participating in our online
    auctions. SSL security is the international standard for ensuring secure e-commerce
    transactions and communications. An SSL Certificate and seal are the trusted mark of
    Internet security to enabling the strongest SSL encryption and security available to site
    visitors. Our SSL seal verifies that encryption is active and transactions are secure and
    in real time. The seal includes a time/date stamp showing Greenwich Mean Time.


    We do not disclose buyer information to any parties or entities other than the specific
    sellers whose merchandise is purchased by the buyer. The sole exception is confidential
    release to potential government clients when security of information is assured in
    writing.       Such release is conditioned upon the commitment not to duplicate the
    information and to return the information in its original form.




J. Federal Trade Commission’s Online Auction Awareness Link


    LoneStarOnline.com and LoneStarAuctioneers.com each have a link to the FTC’s
    online consumer guide for some time. Those links will be maintained on our sites for
    the duration of this contract and beyond.


6.2.8 Describe the reporting capabilities available to the seller. Provide sample copies of a
transaction log and admin fee payment reconciliation report.




Online Auction Activity Reports Available to AEPA Agencies


The following online auction reports are available to full-service clients:




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A. Auction Status Report

    This report summarizes the financial details of the auction including the total sales,
    total applicable sales taxes, shipping and handling and insurance, total buyer charges,
    total buyer payments, net due from buyers, total consignor sales, total commissions
    earned and net due to consignors.

B. Final Statement Report

    This is the Consignor Status Report which details the sales by agency, accounting code,
    fund code, department or any other allocation of funds. This would allow AEPA
    agencies to track the sales of each district or fund account.

    This report is printed by district, fund or department account and provides the auction
    (lot) number, buyer number, buyer and company name and address, phone and fax
    number, winning bid amount, tax (if applicable), number of lots sold and total sales for
    that district, fund or department, commissions and expenses and net due consignor.

C. Consignor Summary Report

    This report summarizes the total sales, commissions, expenses (if applicable), and total
    due the consignor for a group of auctions by district, fund or department for a client
    and gives the total of those categories for that client.

D. Active Buyers Report

    This lists the active buyers with their buyer number, buyer and company name and
    address, phone and fax number, email address and user name that participated in that
    particular auction.

E. Buyer Payment Report

    This details the payment amounts, payment type (cash, certified check, money order,
    wire transfer) and sequential invoice number by buyer including buyer number, buyer
    and company name and address, phone and fax number.

F. Lot Sales Report

    This lists the group’s auctions in lot number order giving the description, buyer
    number and the winning bid price totaled to match the other consignor reports.

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G. Sales Tax Report

    This lists the taxable sales, tax rate and total taxes by consignor (if sales taxes are
    applicable).

H. Accounts Receivable Report

    This lists by sale the buyer number and name, the phone number, the amount due,
    payments and any account receivable balance by buyer totaled for the sale.

A Transaction Log and Admin Fee Payment Reconciliation Report will be developed upon
award of the contract to Lone Star Auctioneers.


6.2.9 Indicate how long auction records are maintained for download by the seller.

Lone Star Auctioneers maintains 24/7 online as well as live and webcast auction records in
perpetuity.       The seller can download any auction that has ever been posted in their
account.

6.2.10 Describe the system’s security capabilities and the privacy protection available to both
sellers and buyers.

Lone Star Auctioneers has an SSL Certificate with “GeoTrust,” to maintain internet
security for sellers and buyers in our online auctions. The encryption enabled by the SSL
Certificate assures online visitors that confidential information and transactions cannot be
viewed, intercepted or altered. GeoTrust certificates are only issued to fully authorized
subscribers.
Both our corporate headquarters server and our 24/7 auction server are protected by state-
of-the-art firewalls and up to date virus protection. Both are password protected, and
access to them is strictly controlled.


Access to client information and buyer information is strictly controlled and limited to only
those individuals who have a functional need to access that information. We do not release
any buyer information for any reason except as basic registration data such as name,
address and phone number. Drivers License, Social Security Number, credit card or other
financial information is never divulged. We have not and would not release any client
information without the express written permission of the client.




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                                                 Page 74 of 86
All employees of Lone Star Auctioneers undergo rigorous background checks and are
cleared through the National Crime Information Center (NCIC) and the Texas Crime
Information Center (TCIC) prior to employment.


Our servers and other hardware are physically secure as well. The access and control of
the 24/7 auction server is closely controlled. It operates in a high-priority, special utility
district that is protected from brownouts and rolling blackouts. The following information
is provided to convey the seriousness with which we regard security of assets, information,
hardware and software.


6.2.11 Provide website information to include administrative access to the site. Include
instructions and screen shots for navigating the various site tools.


Although AEPA members will not need administrative access to the backend of
LoneStarOnline.com, Lone Star Auctioneers includes screen shots of the administrative
backend of LoneStarOnline.com and the interactive help pages for each section as
attachments in the bid binder. The help pages should be relatively self-explanatory.


The user members will be able to query and modify from the “My Account” section of
LoneStarOnline.com after logging into the system.




6.2.12 Describe the steps for a member to begin using the web based auction system.


A member will be provided a “How To” packet with basic information and will receive
simple training to use the system. Included would be a spreadsheet template in MS Excel,
or Corel QuattroPro (WordPerfect) or both. Also included will be simple requirements for
creating and naming digital images corresponding to the auction lots to be sold. Both
spreadsheet and image instructions will be included in the training seminars.


A member creates or imports lots into a spreadsheet of three (3) to five (5) fields with lot
numbers, descriptions and other fields as appropriate. The member takes digital images
((typically one (1) to four (4)) of each lot and names the images with corresponding lot
numbers. The spreadsheet and images are either emailed to our contact or posted to a
dedicated FTP site to be downloaded by our contact.

AEPA IFB 007-G, Part B, Online Auction Service                   Due: October 27, 2006 at 1:30pm EST
                                                 Page 75 of 86
Lone Star will provide starting prices, post, monitor, close, collect and report all auctions
for and to the member. Each member may access will have an exclusive site to which only
authorized member personnel will have access. The authorized personnel will be able to
monitor, query, change lot information, etc.


Full reports will be sent to each member on a regular basis immediately after closing and
collection of each auction. Full payment will be made on a timely basis for all auctions that
close in a calendar month for each member.


6.2.13 Describe the process for creating and conducting an auction.


By creating the spreadsheet and images described in 6.2.12 above, members will have done
everything necessary to create and conduct the auction.


6.3 Services

6.3.1 Describe how bidder proposes to market the program to potential bidders. Provide
samples of marketing efforts that have worked effectively in the past.

Lone Star Auctioneers will take two primary approaches to the AEPA 24/7 online auction
program, a state-wide approach to MA markets in general and a local approach for the
individual PAM markets. This would involve two different advertising and promotional
programs, each with an initial strategic new market development campaign followed by a
tactical development campaign.

The statewide program would be accomplished with periodic ads in selected large market
dailies and in daily and weekly smaller market newspapers on a blanket basis statewide.
Press releases and PSAs would be sent to major and smaller markets throughout the state.

Even though Lone Star has online and live buyers in every state, we will treat each
individual market as a new market in terms of aggressively generating buyers for AEPA
online auctions using the following means:

•   Sending direct mail notices to all buyers on our USPS mail list in each of the PAM
    markets as merchandise warrants;

•   Sending electronic brochures to all 25,000 plus buyers in our LoneStarOnline.com
    buyer database and LoneStarAuctioneers.com our email subscribers list (subscription
    is free and easy to do);

•   Creating a prominent listing on our home page under “24/7 Online Auctions” with links
    directly to the PAM auctions;

•   Initial and periodic advertising in the local newspapers as merchandise warrants;

AEPA IFB 007-G, Part B, Online Auction Service                   Due: October 27, 2006 at 1:30pm EST
                                                 Page 76 of 86
•   Initial and periodic advertising in state-wide small newspapers with weekly circulation
    of millions of readers on an initial and recurring basis as merchandise warrants;

•   Including PAM auctions in the full cover ads we place periodically in Contractors
    HotLine, a weekly contractor trade magazine as member assets warrant;

•   Listing AEPA auctions on the Contractors HotLine website as member assets warrant;
•
•   Initial and periodic advertising in the Shopper’s Guide, Green Sheet and the Thrifty
    Nickel publications in PAM markets as merchandise warrants;

•   Creating links to the individual state specific URL domains (such as
    AZschoolsurplus.org and NMschoolsurplus.org) for links on PAM home pages;

•   Developing links to other websites and affinity organizations;

•   Initially we will place ads in the state-wide newspapers followed by display and in-
    column ads in various classified sections that correspond to the classes of merchandise
    we are offering as merchandise warrants.


The focus of the initial advertising and promotion will be to create an awareness of AEPA’s
online program in all the MA regions. This will be done through press releases and public
service announcements to local media and advertising in MA area outlets in addition to
placed advertising.

The following is an example of the type of small market advertising we will do for MA
markets in the state of Arizona:




                                       Arizona Small Market Newspapers
                                      90 Newspapers Circulation 1,050,165
                                                       (effective 1/1/05)
                DAILY NEWSPAPERS:
                Arizona Daily Sun (Flagstaff)    11,909            Eloy Enterprise          720
                Bisbee Daily Review              895               Florence Reminder &      1,548
                                                                   Blade-Tribune




AEPA IFB 007-G, Part B, Online Auction Service                                           Due: October 27, 2006 at 1:30pm EST
                                                          Page 77 of 86
                Casa Grande Dispatch             9,359           Fountain Hills Times         5,354
                Daily Courier, The (Prescott)    17,831          Gilbert Independent          22,488
                Daily Dispatch, The (Douglas)    2,310           Glendale Star                9,284
                Daily Territorial (Tucson)       798             High Country Sentinel        1,000
                                                                 (Heber/Overgaard)
                Kingman Daily Miner              8,079           Inside Tucson Business       6,656
                Mohave Valley Daily News         8,276           Journal, The (Camp           1,725
                (Bullhead City)                                  Verde)
                Sierra Vista Herald              10,342          Lake Powell Chronicle        2,168
                                                                 (Page)
                State Press (ASU) weekly         18,000          La Voz (Phoenix)             50,000
                during summer
                Today's News-Herald (Lake        10,221          Maricopa Monitor             650
                Havasu City)
                Sun, The (Yuma)                  23,732          Mountain View News           9,400
                                                                 (Sierra Vista)
                East Valley Tribune (Phoenix)    95,231          Navajo-Hopi Observer         13,700
                                                                 (Flagstaff)
                                                                 Navajo Times (Window         20,234
                                                                 Rock)
                THREE TIMES WEEKLY:                              North Scottsdale             12,603
                                                                 Independent
                Bugle, The (Camp Verde)          3,617           Northeast Phoenix            16,730
                                                                 Independent
                Verde Independent                994             Parker Pioneer               3,202
                (Cottonwood)
                                                                 Peoria Independent           15,500
                TWICE WEEKLY:                                    Peoria Times                 5,150
                Eastern Arizona Courier          8,397           Quartzsite Times             536
                (Safford)
                Green Valley News & Sun          10,157          Queen Creek                  12,000
                                                                 Independent
                Holbrook Tribune-News            3,357           San Carlos Apache            1,711
                                                                 Moccasin
                Nogales International            3,642           San Manuel Miner             3,535
                Payson Roundup                   6,588           San Pedro Valley News-       2,959
                                                                 Sun (Benson)
                Prescott Valley Tribune          14,266          Silver Creek Herald          2,578
                                                                 (Snowflake/Taylor)
                Sedona Red Rock News             6,572           Sonoran News (Carefree)      37,526
                West Valley View (Avondale)      58,275          Southwest Valley Sun         13,500
                                                                 (Buckeye)
                White Mountain Independent       9,093           Standard, The                8,610
                (Show Low)                                       (Kingman)
                                                                 Sun Cities Independent       21,999
                WEEKLY:                                          Sun City West                13,417
                                                                 Independent
                Anthem/Deer Valley               16,000          Superior Sun                 1,243
                Independent
                Apache Junction/Gold Canyon      19,433          Surprise Independent         16,448
                News
                Apache Junction/Gold Canyon      15,404          Town of Paradise Valley      6,337
                Ind.                                             Independent
                Arizona Capitol Times            4,056           Tucson Weekly                46,738
                (Phoenix)
                Arizona City Independent         442             Wester, The (Sun City        8,000
                                                                 West)
                Arizona Range News (Willcox)     3,068           West Phoenix View            25,300
                                                                 (Glendale/W. Phx)
                Arizona Silver Belt (Globe)      4,373           Wickenburg Sun               3,855
                Arrowhead Ranch Independent      12,712          Williams-Grand Canyon        4,150
                Bajo El Solicitation (Sonoita)   21,000          Winslow Mail                 4,060
                Big Bug News (Prescott Valley)   4,360
                Bisbee Observer                  2,461           BI-MONTHLY:
                Bulletin, The (Sonoita)          1,143           Pioneer Newspaper -          2,760
                                                                 Apache County
                Bullhead City Bee                3,700           Pioneer Newspapers -         7,150
                                                                 Navajo County
                Chandler/Sun Lakes               22,682          Wrangler News (Tempe)        18,100
                Independent
                Chino Valley Review              5,666
                Coolidge Examiner                1,845           MONTHLY:


AEPA IFB 007-G, Part B, Online Auction Service                                             Due: October 27, 2006 at 1:30pm EST
                                                          Page 78 of 86
                                       Arizona Small Market Newspapers
                                      90 Newspapers Circulation 1,050,165
                                                         (effective 1/1/05)
                DAILY NEWSPAPERS:
                Arizona Daily Sun (Flagstaff)    11,909              Eloy Enterprise           720
                Bisbee Daily Review              895                 Florence Reminder &       1,548
                                                                     Blade-Tribune
                Casa Grande Dispatch             9,359               Fountain Hills Times      5,354
                Daily Courier, The (Prescott)    17,831              Gilbert Independent       22,488
                Daily Dispatch, The (Douglas)    2,310               Glendale Star             9,284
                Copper Basin News (Kearny)       2,503               Scottsdale Times          30,300
                Copper Country News (Globe)      8,500               Au-Authm Action News      3800
                Copper Era, The (Clifton)        1,950
                Cottonwood Journal Extra         7,343
                Desert Advocate (New River)      30,350
                East Mesa Independent            24,509


Through the press releases, we hope to generate media coverage such as feature articles
and perhaps live or phone interviews with TV/radio and a member representative or a
member of our staff.

Lone Star would also encourage the PAM to place a MA-specific link to our online website,
such as www.AZschoolsurplus.com, so visitors to the PAM home page and potential buyers
could link directly to the member’s auctions. We also would encourage the members to
include a link for potential bidders to sign up for email notifications AEPA auctions.

The tactical maintenance and new market campaign would be a continuing effort to
maintain awareness of AEPA member auctions and also to continue to develop a broader
state-wide market.

One caveat for the advertising, marketing and promotional campaigns is that each aspect
must bear reasonable economic proportion to the quantiti(ies), quality(ies) and volume(s)
of assets being offered in each Member Agency statewide market and each Participating
Agency Member’s local and regional market.


6.3.2 Indicate the average number of “hits” per day the proposed website receives.

Lone Star’s high website traffic is currently averages twenty over (20) million hits per
month and is rapidly growing (On August 29-31, 2006, LoneStarOnline.com, received over
1,000,000 hits per day). One September 1, 2006, it rose to 1,236,216 hits for the day.
September had 24,000,000 hits for the month. Over 6,000 affinity Internet sites link to our
sites as measured by an independent link evaluation service.




AEPA IFB 007-G, Part B, Online Auction Service                                              Due: October 27, 2006 at 1:30pm EST
                                                            Page 79 of 86
6.3.3 Provide samples of instructional documentation that is available to sellers and buyers.
Indicate any distribution restrictions that may apply and how often the materials are updated.


Samples of the instructional documentation available to sellers is included in the pocket of
our bid binder, our “How To” sheet, a sample Spreadsheet Template used for submitting
items to be posted for auction.

6.3.4 Describe bidder’s plan to minimize the number of buyers who renege on a purchase and
the tools available to seller if this occurs.

First, bidders must register on www.lonestaronline.com. Lone Star personnel must
approve and activate bidders as registrations are received. Bidders are not approved to bid
until they have accepted the Terms & Conditions which are posted on the website as part of
a binding contract between buyer and seller. After a registration is received, the person’s
buying history is checked in our auction software. Any negative history will appear and
prevent any approval or activation of a bidder. Unapproved bidders cannot execute bids.

Next, when the auction closes a notification email is sent to each successful bidder detailing
the total amount of purchases and detailing payment terms. The deadline for receipt of
payment is clearly stated on the email.

If payment is not received by one day prior to the deadline, a Lone Star staff member
emails or calls each bidder whose payment has not been received to inquire whether the
buyer received the prior notification email. The staff member reminds the bidder of the
payment deadline and discusses payment terms with the buyer. The method of sending the
payment is discussed along with other specific information which provides some assurance
that a buyer does in fact plan to send the payment by means of an overnight service such as
FedEx, DHL or US Postal Express Mail.

Any buyer who does not pay by the stated deadline is treated as a slow-pay, which means
the buyer will receive a letter regarding payment requirements. The buyer is advised in
this letter that any future slow payment of online purchases will result in a late fee
assessment of $25 and then permanent deactivation of that buyer within the
lonestaronline.com auction system if that buyer continues to pay late.

A buyer who defaults on payment for auction purchases or is a slow-pay for two auctions
may not participate in Lone Star auctions in the future. This is accomplished in several
ways: 1) The non-payment is documented in the buyer’s history in our auction software.
That history is retained in our system permanently. The amount and date of the default
are detailed along with all the pertinent information about that buyer. 2) The buyer is
blocked in the online auction system by user name. 3) The buyer is blocked in the online
auction system by email address. We continue to monitor and approve buyers before they
are activated in our online auctions. Therefore, if a buyer changes email address and user
name, we catch them at re-registration and prevent them from participating and, we block
their new user name and email address.

No one can prevent a buyer from reneging on their purchases, we can however continue to
take steps to prevent them from participating in our online auctions ever again.



AEPA IFB 007-G, Part B, Online Auction Service                   Due: October 27, 2006 at 1:30pm EST
                                                 Page 80 of 86
6.3.5 Describe the types of items commonly sold on the proposed website and any exclusions.


Lone Star has had great success selling a wide variety of items on our 24/7 website
including:

              ▪              fire trucks
              ▪              packer body garbage trucks
              ▪              specialty trucks
              ▪              sewer cleaner
              ▪              asphalt distributor
              ▪              articulating loader
              ▪              sweepers
              ▪              police pursuit cars
              ▪              tractors
              ▪              trailers
              ▪              air compressors
              ▪              boats
              ▪              freon
              ▪              seized and abandoned vehicles
              ▪              medical equipment
              ▪              printing equipment
              ▪              exercise equipment
              ▪              laser plotter
              ▪              office furniture
              ▪              typewriters
              ▪              desks
              ▪              chairs
              ▪              file cabinets
              ▪              computer equipment
              ▪              display fixtures
              ▪              dishwasher
              ▪              cedar timbers
              ▪              heaters
              ▪              diamonds
              ▪              gold and silver coins and bullion
              ▪              Marilyn Monroe and Lucille Ball stamps
              ▪              sports memorabilia
              ▪              art work
              ▪              ephemera
              ▪              baby blankets
              ▪              commemorative plates
              ▪              antiques
              ▪              and many other types of assets

As examples the success we have achieved with surplus vehicles and heavy equipment on
www.lonestaronline.com, we offer the following sales results:

 Item sold                                                  Selling        Bids        Times
                                                            price                      viewed
 1989 Caterpillar D8N Dozer                                      $62,750          78          590
 1991 Cat 826C Compactor                                         $31,000          32          361

AEPA IFB 007-G, Part B, Online Auction Service                              Due: October 27, 2006 at 1:30pm EST
                                                 Page 81 of 86
 Item sold                                                  Selling         Bids        Times
                                                            price                       viewed
 1993 John Deere 862B Scraper                                     $29,000          68          368
 1989 Morbark Waste Recycler                                      $14,701          30          356
 1987 John Deere 444D Loader                                      $17,075      330          1,715
 1978 Cat 983 Dozer                                               $16,025          78       1,738
 1987 John Deere 210C Backhoe                                     $12,550          69       1,146
 2002 Mack Container Truck                                       $111,900          18          165
 1996 GMC Packer-body Garbage Truck                               $28,850          62             7
 2000 Crane Carrier                                               $25,750          62             8
 Olath Tub Grinder                                                $15,000           1          564
 1990 E-One Pumper Truck                                          $21,975          81       2,445
 1989 Pierce Chemical Fire Truck                                  $19,250           8          421
 1982 FMC Quint Aerial Truck                                      $14,075          85       1,536
 1999 Ford F350 w/ no bed                                         $13,650      104          1,978
 2000 Ford F350 Ambulance                                         $10,850          35          628
 1985 Chev C70 Fire Support Truck                                  $8,550          96       1,442
 1996 Peterbilt Toter w/ 12 ft. Lounge                            $53,000      121          2,943
 1997 48 ft. Champion Stacker Trailer                             $76,600      130          2,712
 1994 Ford Combo Machine (w/o                                     $12,525          77          452
 transmission)
 1991 IH 4900 Service Truck w/Compressor                           $8,110          22          650
 1991 IH Utility Truck                                             $9,275          29       1,079
 1987 GMC Single-axle Dump 160K+ miles                             $5,275           6          980
 1995 Ford F800 Sewer Cleaner 149K+                                $8,900          31          767
 2002 Camaro (Bad Motor, graffittied, 69K+)                        $6,800          55       1,120
 2002 Crown Vic (Inoperable, graffitied,                           $6,100          41          446
 95K+)
 2002 Crown Vic (rear axle problems, graffiti)                     $4,550          22          307
 1998 Ford SUV 107K+ miles                                         $7,535          35       1,977
 1995 BMW 525i (Poor condition, 90K+ mi)                           $5,550          46       1,131
 1,800 to 2,000 tons of Coarse Aggregate                          $16,500          46       1,123
 22' Shoalwater Boat (Inoperable)                                  $4,050          43       1,015
 Histological Tissue Processor                                    $10,000           1          415

AEPA IFB 007-G, Part B, Online Auction Service                               Due: October 27, 2006 at 1:30pm EST
                                                 Page 82 of 86
For two (2) years we sold sixty lots of jewelry, coins and other valuables from unclaimed
safe deposit boxes every week for the California State Controllers Office under an annual
contract for online auction services. In two (2) years since the start of the 24/7 contract, we
sold over $1,726,261.00 in unclaimed property for the Controller. We achieved over 150%
of appraised value for the total sales.

Lone Star is currently averaging 148% of appraised value on collected sales. We offer the
following examples of prices we receive on this merchandise:

 Item sold                                            Selling      Bids Times viewed
                                                      price
 1909S Lincoln Penny                                        $2,800    1          370
 Waltham Pocket Watch                                             $950    17                 280
 14K Rose Pendant w/ .40 cts of diamonds                          $485    11                 291
 $177.40 in 90% US Silver Coins                                   $865     2                 220
 3-Continental Currency Notes                                     $400    10                 293
 High Kt Gold Bangle Bracelet                                     $630     7                 226
 46-US Silver Dollars                                             $575     9                 268
 30 Liberty Head Platinum Coins                             $35,300       19              1,013
 46-Canadian Maple Leaf 1 Oz. Gold                          $20,142       20                 642
 Coins
 Platinum, Ruby and Diamond Ring                                 $8,100   58                 556
 14K Volta Chronograph Pocket Watch                              $7,400   16                 436
 $500 in 90% US Silver Dimes                                     $2,600   18                 194
 14K Gent’s Ring w/ 1.07 Ct. Diamond                             $3,400   14                 510
 2.12 Ct. loose round brilliant cut diamond                 $24,850       52              1,273
 14K Ring w/ 1.48 Ct. Diamond                                    $4,400   21                 655
 30-Mixed St. Gaudens $20 Gold Pieces                       $15,050       33                 476
 1907 St. Gaudens Gold Piece                                     $1,900    1                 383
 Platinum Rolex Watch                                       $33,200       19                 959
 Stainless Steel Gallet Wristwatch                               $1,550   18                 157
 Gorham Sterling Flatware                                        $2,021    5                 524
 Waltham Hunter Case Pocket Watch                                $1,550    3                 589
 1952 Topps Mickey Mantle Baseball                          $11,300       24              1,324
 Card
 10K Cameo and Seed Pearl Pendant                                $7,500    5                 501

We have a secured creditor that sells approximately 20 auctions per week on our site. One
of the items sold and collected for them was a diamond ring which brought $28,500.
AEPA IFB 007-G, Part B, Online Auction Service                             Due: October 27, 2006 at 1:30pm EST
                                                 Page 83 of 86
Exclusion of Items

We do not plan to exclude any items from the online auction with the possible exception of
items that are illegal to sell in certain or all states, hazardous chemicals or items that may
pose a threat to the buyers or general public. We would work with the member to
determine the appropriateness of special items to offer on the internet.

We do recommend the PAMs should group low value items into single auctions to
encourage the sale, payment and removal of those types of items. We will provide our best
judgment and expertise to member personnel to develop guidelines for such groupings.
Prudent management of such low value items will minimize the maintenance and
administration of labor and costs for both the PAM and our firm.

6.3.6 Describe training services available to contracting AEPA Member Agencies sellers and
buyers.

Seller Training


With the full-service program, there will be no training for seller personnel necessary other
than the simple procedures of descriptions, lotting protocol and digital photography in the
implementation of the program described above.


Lotting protocol will be dealt with on a case by case basis as different classes of surplus and
confiscated property are scheduled for auction. Our personnel will work directly with
PAM staff to develop this capacity. There are no hard and fast rules about how you lot
lower value, damaged or hard to sell merchandise.


What we try to do is develop in our clients a feel for the best way to aggregate items so that
they will yield the highest returns, and in some cases, just get the items sold and out of the
PAM’s care and custody. For instance, occasionally we will pair a difficult item with a
better item of similar nature so that a buyer will get the cull with the more desirable item.


If the user still has questions or finds the help file inadequate, they can call or full-time
IT/Web Manager who provides primary help desk assistance for our seller/users. We have
additional support staff to help by email, phone, and after hours cell phone




AEPA IFB 007-G, Part B, Online Auction Service                   Due: October 27, 2006 at 1:30pm EST
                                                 Page 84 of 86
Buyer Training


We have found through experience that our buyers require very little assistance or training
to user our 24/7 online software. Our site works almost exactly like eBay in its vocabulary
and functionality. It is a user friendly online website that includes “Help” and “FAQ”
sections.


When buyers do need help, we have a Service Desk email address (customer-
service@lonestarauctioneers.com)to which they can send their questions. However, they
usually call our offices where our staff is qualified to answer almost any question about
how to bid, what something means or other questions about a particular auction or the site
in general. We provide email and phone support during office hours to our bidders. All
phone questions are answered during business hours immediately. We answer all emails
within usually on the same day but no later than the next business day. Lone Star has ten
full-time employees in our offices in Fort Worth to provide support.

6.3.7 Describe bidder’s system of technical support. What are the hours and days technical
support is available? Do you provide upgrade packages? Distinguish between seller and buyer
support.


Technical support is available between the hours of 7:00 A.M. until at least 5:30 P.M.,
Central Time, Monday through Fridays except Federal Holidays. Most holidays someone
can be found working that can provide a basic level of tech support.


Non-emergency tech support by email will usually be answered in two (2) hours or less but
in no case later than twenty-four (24) hours after receipt. Emergency support is available
by telephone at our main number, 817.740.9400, or our national toll-free line, 800.275.3336.


Member Agencies get unlimited emergency support by email or telephone and unlimited
non-emergency technical support by email.                   Participating Agency Members will get
unlimited emergency technical support by email and by phone as available. Unlimited
non-emergency email support will be provided to PAMs on an “as available” basis.


Lone Star will notify the representative Member Agency if a PAM is using an inordinate
amount of support help for non-essential issues or repetitive topics.

AEPA IFB 007-G, Part B, Online Auction Service                          Due: October 27, 2006 at 1:30pm EST
                                                 Page 85 of 86
Buyer support is available during business hours at Service@LoneStarAuctioneers.com
or by telephone at the numbers above. Our system is so simple, we have very few buyer
calls for help.




6.3.8 Indicate payment options accepted by bidder (e.g. Visa, MasterCard, AMEX, personal
check, cashier’s check, money order, etc.).

Payment for online purchases may be in the form of cashier’s check or money order which
is sent to Lone Star’s offices and received by a specific advertised deadline. The usual
deadline is noon the third business day following the close of an auction. However, the
payment deadline for PAM auctions may be set to reflect the needs and wishes of the
agency.


If Lone Star Auctioneers offers payment by personal/company checks, we will use a
guarantee service and collect a 2.5% “guarantee fee” from the buyer.




AEPA IFB 007-G, Part B, Online Auction Service                   Due: October 27, 2006 at 1:30pm EST
                                                 Page 86 of 86

				
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