Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Mar. 22, 2016 | Jun. 30, 2015 | |
Document And Entity Information | |||
Entity Registrant Name | PGI INC | ||
Entity Central Index Key | 81,157 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2015 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Is Entity a Well-known Seasoned Issuer? | No | ||
Is Entity a Voluntary Filer? | No | ||
Is Entity's Reporting Status Current? | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $ 0 | ||
Entity Common Stock, Shares Outstanding | 5,317,758 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,015 |
CONSOLIDATED STATEMENTS OF FINA
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
ASSETS | ||
Cash and cash equivalents | $ 1,000 | $ 1,000 |
Restricted cash (Note 3) | 5,000 | 5,000 |
Receivables-related party (Note 14) | 178,000 | 332,000 |
Land and improvement inventories (Note 4) | 639,000 | 639,000 |
Other assets (Note 5) | 44,000 | 51,000 |
Total Assets | 867,000 | 1,028,000 |
LIABILITIES | ||
Accounts payable and accrued expenses (Note 6) | 202,000 | 229,000 |
Accrued real estate taxes (Note 6) | 8,000 | 8,000 |
Accrued Interest: | ||
Primary lender-related party (Note 7) | 450,000 | 408,000 |
Subordinated convertible debentures (Note 8) | 22,484,000 | 21,389,000 |
Convertible debentures-related party (Note 9) | 54,558,000 | 47,351,000 |
Other (Note 7) | 3,081,000 | 3,020,000 |
Credit Agreements (Note 7): | ||
Primary lender-related party | 500,000 | 500,000 |
Notes payable | 1,198,000 | 1,198,000 |
Subordinated convertible debentures payable (Note 8) | 8,472,000 | 8,552,000 |
Convertible debentures payable-related party (Note 9) | 1,500,000 | 1,500,000 |
Liabilities Total | $ 92,453,000 | $ 84,155,000 |
Commitments and Contingencies (Note 13) | ||
STOCKHOLDERS' DEFICIENCY | ||
Preferred stock, par value $1.00 per share; authorized 5,000,000 shares; 2,000,000 Class A cumulative convertible shares issued and outstanding; (liquidation preference of $8,000,000 and cumulative dividends) (Note 11) | $ 2,000,000 | $ 2,000,000 |
Common stock, par value $.10 per share; authorized 25,000,000 shares; 5,317,758 shares issued and outstanding (Note 11) | 532,000 | 532,000 |
Paid-in capital | 13,498,000 | 13,498,000 |
Accumulated deficit | (107,616,000) | (99,157,000) |
Total stockholders' deficiency | (91,586,000) | (83,127,000) |
Total liabilities and stockholders' deficiency | $ 867,000 | $ 1,028,000 |
CONSOLIDATED STATEMENTS OF FIN3
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Parenthetical) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
STOCKHOLDERS' DEFICIENCY | ||
Preferred stock, par value | $ 1 | $ 1 |
Preferred stock, authorized | 5,000,000 | 5,000,000 |
Preferred stock, liquidation preference (excluding cumulative dividends) | $ 8,000,000 | $ 8,000,000 |
Preferred stock - Class A cumulative convertible shares, issued | 2,000,000 | 2,000,000 |
Preferred stock - Class A cumulative convertible shares, outstanding | 2,000,000 | 2,000,000 |
Common stock, par value | $ 0.10 | $ 0.10 |
Common stock, authorized | 25,000,000 | 25,000,000 |
Common stock, issued | 5,317,758 | 5,317,758 |
Common stock, outstanding | 5,317,758 | 5,317,758 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Revenues: | ||
Interest income-related party (Note 2) | $ 8,000 | $ 12,000 |
Other Income | 4,000 | |
Total Revenues | 8,000 | 16,000 |
Costs and expenses: | ||
Interest | 1,293,000 | 1,297,000 |
Forgiveness of debt and interest | (209,000) | (1,313,000) |
Interest-related party | 7,249,000 | 6,322,000 |
Taxes and assessments | 9,000 | 9,000 |
Consulting and accounting-related party | 38,000 | 39,000 |
Legal and professional | 9,000 | 12,000 |
General and administrative | 79,000 | 163,000 |
Total costs and expenses | 8,467,000 | 6,528,000 |
NET LOSS | $ (8,459,000) | $ (6,512,000) |
Loss Per Share Available to Common Stockholders - Basic and Diluted (Note 16) | $ (1.71) | $ (1.34) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities: | ||
Interest received-related party | $ 8,000 | $ 12,000 |
Other income | 4,000 | |
Cash received from operations | $ 8,000 | 16,000 |
Cash expended for operations: | ||
Taxes and assessments | 9,000 | 9,000 |
Consulting and accounting-related party | 38,000 | 39,000 |
Legal and professional | 44,000 | 17,000 |
General and administrative | 71,000 | 59,000 |
Cash expended for operations | 162,000 | 124,000 |
Net cash flows used in operating activities | (154,000) | (108,000) |
Cash flows from investing activities: | ||
Net repayments of notes receivable-related party | 154,000 | 108,000 |
Net cash flows provided by investing activities | $ 154,000 | $ 108,000 |
Net change in cash and cash equivalents | ||
Cash and cash equivalents at beginning of year | $ 1,000 | $ 1,000 |
Cash and cash equivalents at end of year | 1,000 | 1,000 |
Reconciliation of net loss to net cash used in operating activities: | ||
Net loss | (8,459,000) | (6,512,000) |
Adjustments to reconcile net loss to net cash used in operating activites: | ||
Forgiveness of debt and interest | $ (209,000) | (1,313,000) |
(Increase) decrease in assets: | ||
Deposit with Trustee of 6 1/2% debentures | 89,000 | |
Increase (decrease) in liabilities: | ||
Accounts payable and accrued expenses | $ (27,000) | 10,000 |
Accrued interest | 1,293,000 | 1,296,000 |
Accrued interest-related party | 7,248,000 | 6,322,000 |
Net cash flows used in operating activities | $ (154,000) | $ (108,000) |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT - USD ($) | Preferrred Stock | Common Stock | Additional Paid-In Capital | Accumulated Deficit |
Beginning Balance, Shares at Dec. 31, 2013 | 2,000,000 | 5,317,758 | ||
Beginning Balance, Amount at Dec. 31, 2013 | $ 2,000,000 | $ 532,000 | $ 13,498,000 | $ (92,645,000) |
Net loss | (6,512,000) | |||
Ending Balance, Shares at Dec. 31, 2014 | 2,000,000 | 5,317,758 | ||
Ending Balance, Amount at Dec. 31, 2014 | $ 2,000,000 | $ 532,000 | $ 13,498,000 | (99,157,000) |
Net loss | (8,459,000) | |||
Ending Balance, Shares at Dec. 31, 2015 | 2,000,000 | 5,317,758 | ||
Ending Balance, Amount at Dec. 31, 2015 | $ 2,000,000 | $ 532,000 | $ 13,498,000 | $ (107,616,000) |
1. Significant Accounting Polic
1. Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries after eliminating all significant inter-company transactions. Accounting Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Revenue and Profit Recognition Homesites The Company follows the installment method of profit recognition in accordance with Accounting Standard Codification (ASC) Topic 360-20, Real Estate Sales. Acreage Sales of undeveloped and developed acreage tracts are recognized, net of any deferred revenue and valuation discount, when minimum down payment and other requirements are met. Land and Improvement Inventories Land held for sale to customers and land held for bulk sale are stated at cost, which is not in excess of estimated net realizable value. Homesite costs are allocated to projects based on area methods, which consider footage, future improvements costs and frontage. Cash and Cash Equivalents For purposes of the statements of cash flows, the Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents. |
2. Revenues
2. Revenues | 12 Months Ended |
Dec. 31, 2015 | |
Revenues: | |
Revenues | Revenues for the years ended December 31, 2015 and 2014 included interest income from a short-term note receivable with Love Investment Company (LIC), an affiliate of L-PGI, the Companys primary preferred stock shareholder. In addition, revenue included other income of $4,000 for the year ended December 31, 2014 which represents an option fee received in October 2014 in exchange for an amendment to the cell tower lease on a parcel of property located in Citrus County, Florida. Effective October 26, 2015, the lessee provided notice of termination of the lease agreement which was in a due diligence period. There were no real estate sales in 2015 and 2014. As of December 31, 2015 the Company owned six lots in Citrus County, Florida. The Company continues to be effected by a depressed real estate market in Citrus County, Florida. |
3. Restricted Cash
3. Restricted Cash | 12 Months Ended |
Dec. 31, 2015 | |
Restricted Cash | |
Restricted Cash | Restricted cash includes restricted proceeds held by PGIP, LLC (PGIP), the Primary Lender, as collateral for debt repayment (see Note 14). The restricted escrow funds balance was $5,000 at December 31, 2015 and December 31, 2014. |
4. Land and Improvements
4. Land and Improvements | 12 Months Ended |
Dec. 31, 2015 | |
Real Estate [Abstract] | |
Land and Improvements | Land and improvement inventories consisted of: 2015 2014 Unimproved land $ 625,000 $ 625,000 Fully improved land 14,000 14,000 $ 639,000 $ 639,000 |
5. Other Assets
5. Other Assets | 12 Months Ended |
Dec. 31, 2015 | |
Other Assets [Abstract] | |
Other Assets | Other assets consisted of: 2015 2014 Deposit with Trustee of 6 1/2% debentures $ 41,000 $ 48,000 Prepaid expenses 2,000 2,000 Deferred charges 1,000 1,000 $ 44,000 $ 51,000 |
6. Accounts Payable and Accrued
6. Accounts Payable and Accrued Expenses | 12 Months Ended |
Dec. 31, 2015 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Expenses | Accounts payable and accrued expenses consisted of: 2015 2014 Accounts payable $ 7,000 $ 6,000 Accrued audit/tax expense 40,000 38,000 Accrued consulting fees-related party 1,000 1,000 Environmental remediation obligations 25,000 64,000 Accrued debenture fees 128,000 119,000 Accrued miscellaneous 1,000 1,000 $ 202,000 $ 229,000 Accrued Real Estate Taxes: Accrued real estate taxes consisted of: 2015 2014 Current accrued real estate taxes $ 8,000 $ 8,000 |
7. Credit Agreements - Primary
7. Credit Agreements - Primary Lender and Notes Payable | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Credit Agreements - Primary Lender and Notes Payable | Credit agreements with the Companys primary lender and notes payable consisted of the following: 2015 2014 Credit agreements- Primary lender (PGIP-related party), at prime plus 5%, due June 1, 1997 $ 500,000 $ 500,000 Notes Payable- At prime plus 2%, due October 1, 1984 176,000 176,000 At prime plus 2%, due October 1, 1987 1,000,000 1,000,000 Non-interest bearing, due August 1, 1993 22,000 22,000 $ 1,698,000 $ 1,698,000 The prime rate at December 31, 2015 and 2014, was 3.5% and 3.25%. At December 31, 2015 assets collateralizing the Companys credit agreements with its primary lender totaled $644,000, of which $5,000 represented escrow held by the primary lender, and $639,000 represented land and improvement inventories. The overall weighted-average interest rate for the Companys credit agreements with its primary lender and all remaining notes and mortgages was approximately 6.1% as of both December 31, 2015 and 2014. Although substantially all of the Companys real and personal property including all of the stock of the Companys wholly-owned subsidiaries remains pledged as collateral, the Company negotiated agreements with its mortgage holders to allow the Company to sell part of its land holdings without requiring full payment of the secured debt. Accrued interest due to the primary lender was $450,000 and $408,000 at December 31, 2015 and 2014, respectively. Accrued interest on other notes payable was $3,081,000 and $3,020,000 at December 31, 2015 and 2014, respectively. All of the primary lender debt and notes payable including accrued interest are past due. |
8. Subordinated Convertible Deb
8. Subordinated Convertible Debentures Payable | 12 Months Ended |
Dec. 31, 2015 | |
Convertible Subordinated Debt [Abstract] | |
Subordinated Convertible Debentures Payable | Subordinated debentures payable consisted of: 2015 2014 6 1/2%, due June, 1991 $ 447,000 $ 527,000 6%, due May, 1992 8,025,000 8,025,000 $ 8,472,000 $ 8,552,000 The Trustee of the 6.5% subordinated convertible debentures, which matured in June 1991, with an original face amount of $1,034,000, provided notice of a final distribution to holders of such debentures on September 2, 2014. In connection with such final distribution, the Trustee applied $89,000 of the $184,000 debenture reserve fund that the Trustee had maintained with respect to such debentures, toward debenture administration fees charged by the Trustee, and the remaining balance of $95,000 of the debenture reserve fund for final distribution to holders of such debentures who surrender their respective debentures. During the years ended December 31, 2015 and 2014, such 6.5% subordinated convertible debentures with face amounts of $80,000 and $507,000 have been surrendered by their respective debenture holders, respectively. Funds utilized from the debenture reserve account were $7,000 and $47,000 during the years ended December 31, 2015 and 2014, respectively, in payment of a final distribution to such debenture holders. Accordingly, the Company has recognized $73,000 and $460,000 in forgiveness of debt during the years ended December 31, 2015 and 2014, respectively. In addition, accrued interest in the amount of $136,000 and $853,000 on such debentures that have been surrendered was recorded by the Company as forgiveness of interest expense during the years ended December 31, 2015 and 2014, respectively. As of December 31, 2015 and 2014 the outstanding principal balance on such 6.5% subordinated convertible debentures that were not surrendered by the respective holders equals $447,000 and $527,000, plus accrued and unpaid interest of $788,000 and $894,000, respectively. If and when such remaining debentures are surrendered to the Trustee, the applicable portion of such principal and accrued interest will similarly be recorded as debt and interest forgiveness. As the Company has consistently stated in prior filings, the Company believes that any potential claims by the respective debenture holders on such 6.5% subordinated convertible debentures would be barred under the applicable statutes of limitations. Since issuance, $650,000 and $152,000 of the 6½% and 6% debentures, respectively, have been converted into common stock. This conversion feature is no longer in effect. The Company is in default of certain sinking fund and interest payments on both subordinated convertible debentures totaling $8,472,000 and $8,552,000 in principal plus accrued and unpaid interest of $22,484,000 and $21,389,000 as of December 31, 2015 and December 31, 2014, respectively. The debentures are not collateralized and are not subordinate to each other, but are subordinate to senior indebtedness ($3,198,000 at December 31, 2015). Payment of dividends on the Companys common stock is restricted under the terms of the two indentures pursuant to which the outstanding debentures are issued. In order to meet liquidity needs for future periods, the Company has been and intends to continue to actively seek buyers for the remaining portion of the underdeveloped acreage, when appropriate No assurances can be made that the Company can achieve this objective. |
9. Convertible Debentures Payab
9. Convertible Debentures Payable | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Convertible Debentures Payable | In May 2008, LIC, an affiliate of L-PGI, the Companys preferred shareholder, purchased $703,050 in principal amount of the Companys convertible debentures from the previous debenture holder. The balance of the outstanding convertible debentures in the amount of $796,950, are held by Love-1989. The debentures held by Love-1989 and LIC are secured by a second mortgage behind PGIP on the 366 acres retained by the Company and a security interest behind that held by PGIP in the restricted proceeds escrow. The total debentures balance of $1,500,000 carry a maturity date of July 8, 1997 and are in default. Interest on the debentures accrues at the rate of fourteen percent compounded quarterly. The Companys primary lender credit agreements prohibit the payment of interest until such time as the primary lender loans are repaid. Accrued interest was $54,558,000 and $47,351,000 at December 31, 2015 and 2014 respectively. |
10. Income Taxes
10. Income Taxes | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Reconciliation of the statutory federal income tax rates, 34% for the years ended December 31, 2015 and 2014, to the Companys effective income tax rates follows: 2015 2014 ($ in thousands) Percent of Percent of Amount of tax Pre-tax Loss Amount of tax Pre-tax Loss Expected tax (credit) $ (2,876 ) -34.0 % $ (2,214 ) -34.0 % State income taxes, net of federal tax benefits (338 ) -4.0 % (260 ) -4.0 % Decrease in environmental liability 15 0.0 % 3 0.0 % Increase in valuation allowance 3,199 38.0 % 2,471 38.0 % $ - - $ - - At December 31, 2015, the Company had an operating loss carryforward of approximately $ 69,321,000 which are expiring and will expire at various dates through 2035. 2015 2014 ($ in thousands) Deferred tax asset: Net operating loss carryover $ 26,342 $ 23,127 Adjustments to reduce land to net realizable value 12 12 Expenses capitalized under IRC 263(a) 56 56 Environmental liability 9 24 Valuation allowance (26,247 ) (23,047 ) 172 172 Deferred tax liability: Basis difference of land and improvement inventories 172 172 Net deferred tax asset $ - $ - The Company is no longer subject to U.S. federal or state income tax examinations by tax authorities for years before 2012. |
11. Capital Stock
11. Capital Stock | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Capital Stock | In March 1987, the Company sold, in a private placement, 1,875,000 shares of its Class A cumulative convertible preferred stock to L-PGI for a purchase price of $7,500,000 cash ($4.00 per share). The Company also converted $500,000 of indebtedness owed to a corporation owned by the Companys former Chairman of the Board of Directors and members of his family into 125,000 shares of the cumulative convertible preferred stock. The holders of the preferred stock are entitled to one vote per share and, except as provided by law, will vote as one class with the holders of the common stock. Class A preferred stockholders are also entitled to receive cumulative dividends at the annual rate of $.32 per share, an effective yield of 8%. Dividends accrued for an initial two year period and, at the expiration of this period, preferred stockholders had the option of receiving accumulated dividends, when and if declared by the Board of Directors, in cash (unless prohibited by law or contract) or common stock. At December 31, 2015 cumulative preferred dividends in arrears totaled $13,235,000 ($640,000 of which related to the year ended December 31, 2015). On May 15, 1997 preferred dividends accrued through April 25, 1995 totaling $4,260,433 were paid in the form of 2,000,203 shares of common stock. As of December 31, 2015, the preferred stock is callable or redeemable at the option of the Company at $4.00 per share plus accrued and unpaid dividends. In addition, the preferred stock will be entitled to preference of $4.00 per share plus accrued and unpaid dividends in the event of liquidation of the Company. At December 31, 2015 the Company had reserved 6,319,540 common shares for the conversion of preferred stock and debentures. |
12. Quarterly Results
12. Quarterly Results | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Results | Effective October 26, 2015 the Company received notice of termination of a lease agreement for a cell tower lease on a parcel of property in Citrus County, Florida. The lease had been executed on May 1, 2013 and was in a due diligence period.. |
13. Commitments and Contingenci
13. Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | The Company is currently not a party in any legal proceedings. |
14. Related Party Transactions
14. Related Party Transactions | 12 Months Ended |
Dec. 31, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | The Companys primary preferred shareholder is L-PGI, with LIC being its general partner. The Companys convertible debentures (Note 9) are held by L-1989 and LIC. LIC is also the controlling general partner of L-1989. LIC is primarily owned and managed by Andrew S. Love and Laurence A. Schiffer. Messrs. Love and Schiffer serve as the executive officers and directors of the Company. As of December 31, 2015 the Company was in default of its primary credit agreements with PGIP, its Primary Lender (Note 7). PGIP is owned and managed by Hallmark Investment Corporation (HIC). Messrs. Love and Schiffer are directors and executive officers of HIC and own 90% of all the issued and outstanding voting stock of HIC. The Company maintains its administration and accounting offices with Love Real Estate Company (LREC). LREC, which is owned by Mr. Love and Mr. Schiffer, is paid a monthly fee for the following: 1. Maintain books of original entry; 2. Prepare quarterly and annual SEC filings; 3. Coordinate the annual audit; 4. Assemble information for tax filing, review reports as prepared by tax accountants and file same; 5. Track shareholder records through transfer agent; 6. Maintain policies of insurance against property and liability exposure; 7. Handle day-to-day accounting requirements In addition, the Company receives office space, telephone service and computer service from LREC. A fee of $2,800 per month was accrued in 2015 and 2014. The Company made payments of $33,600 to LREC in 2015 and 2014 respectively for accounting service fees. There were no accrued accounting service fees as of December 31, 2015 and 2014. Effective March 25, 1987, the Company entered into a Management Consulting Agreement with LREC. As a consultant to the Company and in addition to the above services, LREC provides other services including, but not limited to, strategic planning, marketing and financing as requested by the Company. In consideration for these consulting services, the Company pays LREC a quarterly consulting fee of one-tenth of one percent of the carrying value of the Companys assets, plus reasonable out-of-pocket expenses. As of December 31, 2015, the carrying value of the Companys assets was approximately $867,000. Consulting fees were $4,000 and $5,000 in 2015 and 2014, respectively. As of both December 31, 2015 and 2014, a total of $1,000 of unpaid fees had accrued under this agreement. In 1985 a corporation owned by the former Chairman of the Board and his family made an uncollateralized loan to the Company, which at December 31, 2015 had an outstanding principal balance of $176,000 plus accrued interest of $431,000, totaling an outstanding balance of $607,000. Interest accrued on this loan was $9,000 in 2015 and 2014. From time to time, the Company invests in short-term debt obligations of an affiliate of L-PGI, the Companys preferred shareholder, Love Investment Company (Note 2). The balance of this receivable including accrued interest at December 31, 2015 and 2014 was $178,000 and $332,000, respectively. Interest on the loans was $8,000 and $12,000 for 2015 and 2014, respectively. |
15. Fair Value of Financial Ins
15. Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | The following methods and assumptions were used to estimate the fair value of each class of financial instrument for which it is practicable to estimate that value: Cash and Restricted Cash: The carrying amount approximates fair value because of the short maturity of those instruments. Receivables: The carrying amount approximates fair value because of the short-term maturity of those receivables. Accounts Payable: The carrying amount approximates fair value because of the short-term maturity of those debts. Debt: It was not practicable to estimate the fair value of the Companys debt with its primary lender, its notes payable and its convertible debentures because these debts are in default causing no basis for estimating value by reference to quoted market prices or current rates offered to the Company for debt of the same remaining maturities. The estimated fair values of the Companys financial instruments are as follows: 2015 2014 Carrying Fair Carrying Fair Amount Value Amount Value Cash and restricted cash $ 6,000 $ 6,000 $ 6,000 $ 6,000 Receivables 178,000 178,000 332,000 332,000 Accounts payable 7,000 7,000 6,000 6,000 Debt 11,670,000 - 11,750,000 - |
16. Loss Per Share
16. Loss Per Share | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |
Loss Per Share | The following is a summary of the calculations used in computing basic and diluted loss per share: 2015 2014 Numerator: Net Loss $ (8,459,000 ) $ (6,512,000 ) Preferred Dividends (640,000 ) (640,000 ) Loss Available to Common Shareholders $ (9,099,000 ) $ (7,152,000 ) Denominator: Weighted average amount of shares outstanding 5,317,758 5,317,758 DILUTED Weighted average amount of shares outstanding 5,317,758 5,317,758 Dilutive effect of assumed conversion of Preferred Stock - - Dilutive common shares 5,317,758 5,317,758 Loss per share Basic $ (1.71 ) $ (1.34 ) Diluted (1.71 ) (1.34 ) |
1. Significant Accounting Pol23
1. Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries after eliminating all significant inter-company transactions. |
Accounting Estimates | Accounting Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Revenue and Profit Recognition | Revenue and Profit Recognition Homesites The Company follows the installment method of profit recognition in accordance with Accounting Standard Codification (ASC) Topic 360-20, Real Estate Sales. Acreage Sales of undeveloped and developed acreage tracts are recognized, net of any deferred revenue and valuation discount, when minimum down payment and other requirements are met. |
Land and Improvement Inventories | Land and Improvement Inventories Land held for sale to customers and land held for bulk sale are stated at cost, which is not in excess of estimated net realizable value. Homesite costs are allocated to projects based on area methods, which consider footage, future improvements costs and frontage. |
Cash and Cash Equivalents | Cash and Cash Equivalents For purposes of the statements of cash flows, the Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents. |
4. Land and Improvements (Table
4. Land and Improvements (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Real Estate [Abstract] | |
Land and improvement inventories | 2015 2014 Unimproved land $ 625,000 $ 625,000 Fully improved land 14,000 14,000 $ 639,000 $ 639,000 |
5. Other Assets (Tables)
5. Other Assets (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Other Assets [Abstract] | |
Other assets consist | 2015 2014 Deposit with Trustee of 6 1/2% debentures $ 41,000 $ 48,000 Prepaid expenses 2,000 2,000 Deferred charges 1,000 1,000 $ 44,000 $ 51,000 |
6. Accounts Payable and Accru26
6. Accounts Payable and Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Payables and Accruals [Abstract] | |
Accounts payable and accrued expenses consist | 2015 2014 Accounts payable $ 7,000 $ 6,000 Accrued audit/tax expense 40,000 38,000 Accrued consulting fees-related party 1,000 1,000 Environmental remediation obligations 25,000 64,000 Accrued debenture fees 128,000 119,000 Accrued miscellaneous 1,000 1,000 $ 202,000 $ 229,000 |
Accrued Real Estate Taxes | 2015 2014 Current accrued real estate taxes $ 8,000 $ 8,000 |
7. Credit Agreements - Primar27
7. Credit Agreements - Primary Lender and Notes Payable (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Credit agreements with the Company's primary lender and notes payable | 2015 2014 Credit agreements- Primary lender (PGIP-related party), at prime plus 5%, due June 1, 1997 $ 500,000 $ 500,000 Notes Payable- At prime plus 2%, due October 1, 1984 176,000 176,000 At prime plus 2%, due October 1, 1987 1,000,000 1,000,000 Non-interest bearing, due August 1, 1993 22,000 22,000 $ 1,698,000 $ 1,698,000 |
8. Subordinated Convertible D28
8. Subordinated Convertible Debentures Payable (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Convertible Subordinated Debt [Abstract] | |
Subordinated debentures payable | 2015 2014 6 1/2%, due June, 1991 $ 447,000 $ 527,000 6%, due May, 1992 8,025,000 8,025,000 $ 8,472,000 $ 8,552,000 |
10. Income Taxes (Tables)
10. Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Reconciliation of the statutory federal income tax rates | 2015 2014 ($ in thousands) Percent of Percent of Amount of tax Pre-tax Loss Amount of tax Pre-tax Loss Expected tax (credit) $ (2,876 ) -34.0 % $ (2,214 ) -34.0 % State income taxes, net of federal tax benefits (338 ) -4.0 % (260 ) -4.0 % Decrease in environmental liability 15 0.0 % 3 0.0 % Increase in valuation allowance 3,199 38.0 % 2,471 38.0 % $ - - $ - - |
Deferred tax assets/liabilities | 2015 2014 ($ in thousands) Deferred tax asset: Net operating loss carryover $ 26,342 $ 23,127 Adjustments to reduce land to net realizable value 12 12 Expenses capitalized under IRC 263(a) 56 56 Environmental liability 9 24 Valuation allowance (26,247 ) (23,047 ) 172 172 Deferred tax liability: Basis difference of land and improvement inventories 172 172 Net deferred tax asset $ - $ - |
15. Fair Value of Financial I30
15. Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Of Financial Instruments Tables | |
Estimated fair values of the Company's financial instruments | 2015 2014 Carrying Fair Carrying Fair Amount Value Amount Value Cash and restricted cash $ 6,000 $ 6,000 $ 6,000 $ 6,000 Receivables 178,000 178,000 332,000 332,000 Accounts payable 7,000 7,000 6,000 6,000 Debt 11,670,000 - 11,750,000 - |
16. Loss Per Share (Tables)
16. Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |
Summary of the calculations used in computing basic and diluted loss per share | 2015 2014 Numerator: Net Loss $ (8,459,000 ) $ (6,512,000 ) Preferred Dividends (640,000 ) (640,000 ) Loss Available to Common Shareholders $ (9,099,000 ) $ (7,152,000 ) Denominator: Weighted average amount of shares outstanding 5,317,758 5,317,758 DILUTED Weighted average amount of shares outstanding 5,317,758 5,317,758 Dilutive effect of assumed conversion of Preferred Stock - - Dilutive common shares 5,317,758 5,317,758 Loss per share Basic $ (1.71 ) $ (1.34 ) Diluted (1.71 ) (1.34 ) |
2. Revenues (Details Narrative)
2. Revenues (Details Narrative) | 12 Months Ended |
Dec. 31, 2014USD ($) | |
Revenues Details Narrative | |
Other income | $ 4,000 |
3. Restricted Cash (Details Nar
3. Restricted Cash (Details Narrative) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Restricted Cash Details Narrative | ||
Restricted escrow funds | $ 5,000 | $ 5,000 |
4. Land and Improvements (Detai
4. Land and Improvements (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Land and improvement inventories | ||
Unimproved land | $ 625,000 | $ 625,000 |
Fully improved land | 14,000 | 14,000 |
Total | $ 639,000 | $ 639,000 |
5. Other Assets (Details)
5. Other Assets (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Other assets consisted of: | ||
Deposit with Trustee of 6-1/2% debentures | $ 41,000 | $ 48,000 |
Prepaid expenses | 2,000 | 2,000 |
Deferred charges | 1,000 | 1,000 |
Total Other Assets | $ 44,000 | $ 51,000 |
6. Accounts Payable and Accru36
6. Accounts Payable and Accrued Expenses (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Accounts payable and accrued expenses | ||
Accounts payable | $ 7,000 | $ 6,000 |
Accrued audit/tax expense | 40,000 | 38,000 |
Accrued consulting fees-related party | 1,000 | 1,000 |
Environmental remediation obligations | 25,000 | 64,000 |
Accrued debenture fees | 128,000 | 119,000 |
Accrued miscellaneous | 1,000 | 1,000 |
Total | 202,000 | 229,000 |
Accrued real estate taxes consisted of: | ||
Current accrued real estate taxes | $ 8,000 | $ 8,000 |
7. Credit Agreements - Primar37
7. Credit Agreements - Primary Lender and Notes Payable (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Primary lender-related party | $ 500,000 | $ 500,000 |
Notes payable | 1,198,000 | 1,198,000 |
Total | 1,698,000 | 1,698,000 |
Primary lender (PGIP-related party), at prime plus 5%, due June 1, 1997 | ||
Primary lender-related party | 500,000 | 500,000 |
At prime plus 2%, due October 1, 1984 | ||
Notes payable | 176,000 | 176,000 |
At prime plus 2%, due October 1, 1987 | ||
Notes payable | 1,000,000 | 1,000,000 |
Non-interest bearing, due August 1, 1993 | ||
Notes payable | $ 22,000 | $ 22,000 |
7. Credit Agreements - Primar38
7. Credit Agreements - Primary Lender and Notes Payable (Details Narrative) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Credit Agreements - Primary Lender And Notes Payable Details Narrative | ||
Collateralizing assets with primary lender | $ 644,000 | |
Escrows held by primary lender | 5,000 | |
Land and improvement inventories | 639,000 | $ 639,000 |
Accrued interest due to the primary lender | $ 450,000 | $ 408,000 |
Prime rate | 3.50% | 3.25% |
Weighted-average interest rate | 6.10% | 6.10% |
Accrued interest on other notes payable | $ 3,081,000 | $ 3,020,000 |
8. Subordinated Convertible D39
8. Subordinated Convertible Debentures Payable (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Subordinated convertible debentures payable | $ 8,472,000 | $ 8,552,000 |
6 and 1/2 %, due June 1991 | ||
Subordinated convertible debentures payable | 447,000 | 527,000 |
6%, due May 1992 | ||
Subordinated convertible debentures payable | $ 8,025,000 | $ 8,025,000 |
8. Subordinated Convertible D40
8. Subordinated Convertible Debentures Payable (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Subordinated Convertible Debentures Payable Details Narrative | ||
Debentures surrendered | $ 80,000 | $ 507,000 |
Debenture reserve funds utilized | 7,000 | 47,000 |
Forgiveness of debt | 73,000 | 460,000 |
Accrued interest decrease forgiveness | 136,000 | 853,000 |
Convertible Subordinated Debt 6.5% Debentures | 447,000 | 527,000 |
Accrued Interest 6.5% Convertible Debentures | 788,000 | 894,000 |
Subordi-nated convertible debentures | 8,472,000 | 8,552,000 |
Accrued and unpaid interest | 22,484,000 | 21,389,000 |
Subordinate to senior indebtedness | $ 3,198,000 | $ 3,198,000 |
9. Convertible Debentures Pay41
9. Convertible Debentures Payable (Details Narrative) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Convertible Debentures Payable Details Narrative | ||
Accrued Interest Convertible Debentures Payable - Related Party | $ 54,558,000 | $ 47,351,000 |
10. Income Taxes (Details)
10. Income Taxes (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Income Taxes Details | ||
Expected tax (credit) | $ (2,876,000) | $ (2,214,000) |
State income taxes, net of federal tax benefits | (338,000) | (260,000) |
Decrease in environmental liability | 15,000 | 3,000 |
Increase in valuation allowance | $ 3,199,000 | $ 2,471,000 |
Income Tax Expense Benefit Continuing Operations | ||
Expected tax (credit), Percentage | (34.00%) | (34.00%) |
State income taxes, net of federal tax benefits, Percentage | (4.00%) | (4.00%) |
Decrease in environmental liability, Percentage | 0.00% | 0.00% |
Increase in valuation allowance, Percentage | 38.00% | 38.00% |
10. Income Taxes (Details 1)
10. Income Taxes (Details 1) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred tax asset: | ||
Net operating loss carryover | $ 26,342,000 | $ 23,127,000 |
Adjustments to reduce land to net realizable value | 12,000 | 12,000 |
Expenses capitalized under IRC 263(a) | 56,000 | 56,000 |
Environmental liability | 9,000 | 24,000 |
Valuation allowance | (26,247,000) | (23,047,000) |
Total tax asset | 172,000 | 172,000 |
Deferred tax liability: | ||
Basis difference of land and improvement inventories | $ 172,000 | $ 172,000 |
Net deferred tax asset |
10. Income Tax (Details Narrati
10. Income Tax (Details Narrative) | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Income Tax Details Narrative | |
Operating loss carryforward | $ 69,321,000 |
Operating losses expiry date | Dec. 31, 2035 |
11. Capital Stock (Details Narr
11. Capital Stock (Details Narrative) | 12 Months Ended |
Dec. 31, 2015USD ($)$ / sharesshares | |
Capital Stock Details Narrative | |
Cumulative preferred dividends in arrears | $ | $ 13,235,000 |
Amount per share Preferred Stock is callable or Redeemable at Option of Company | $ / shares | $ 4 |
Common shares reserved for the conversion of preferred stock and debentures | shares | 6,319,540 |
14. Related Party Transactions
14. Related Party Transactions (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Related Party Transactions [Abstract] | ||
Accounting service fees | $ 33,600 | $ 33,600 |
Carrying value of the Company's assets | 867,000 | |
Consulting fees, related party | 4,000 | 5,000 |
Unpaid Consulting Fees | 1,000 | 1,000 |
Outstanding principal balance | 176,000 | 176,000 |
Outstanding principal plus accrued interest | 607,000 | |
Interest Accrued | 9,000 | 9,000 |
Interest income, related party | 8,000 | 12,000 |
Receivable, related party | $ 178,000 | $ 332,000 |
15. Fair Value of Financial I47
15. Fair Value of Financial Instruments (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Receivables | $ 178,000 | $ 332,000 |
Carrying amount | ||
Cash and Restricted Cash | 6,000 | 6,000 |
Receivables | 178,000 | 332,000 |
Accounts Payable | 7,000 | 6,000 |
Debt | 11,670,000 | 11,750,000 |
Fair value | ||
Cash and Restricted Cash | 6,000 | 6,000 |
Receivables | 178,000 | 332,000 |
Accounts Payable | $ 7,000 | $ 6,000 |
Debt |
16. Loss Per Share_ (Details)
16. Loss Per Share: (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Numerator: | ||
Net Loss | $ (8,459,000) | $ (6,512,000) |
Preferred Dividends | (640,000) | (640,000) |
Loss Available to Common Shareholders | $ (9,099,000) | $ (7,152,000) |
Denominator: | ||
Weighted average amount of shares outstanding | 5,317,758 | 5,317,758 |
DILUTED | ||
Weighted average amount of shares outstanding | 5,317,758 | 5,317,758 |
Dilutive effect of assumed conversion of Preferred Stock | ||
Dilutive common shares | 5,317,758 | 5,317,758 |
Loss per share | ||
Basic | $ (1.71) | $ (1.34) |
Diluted | $ (1.71) | $ (1.34) |